New edition of the Guidelines on Corporate Governance

Viðskiptaráð Íslands (the Iceland Chamber of Commerce), Samtök atvinnulífsins (SA, the Confederation of Icelandic Enterprise) and Nasdaq Iceland have published the seventh edition of the Guidelines on Corporate Governance. Alongside the publication, a new website, leidbeiningar.is, has been launched, where the guidelines are available in an interactive web version in Icelandic and English. The new edition takes effect on 1 January 2027.

During the review, members of Viðskiptaráð and SA, as well as companies listed on Nasdaq Iceland, were asked about their experience of the guidelines. The conclusion was that the guidelines had generally worked well and that there was no need for extensive changes. The emphasis was therefore on simplifying the presentation, clarifying individual points and preventing the guidelines from evolving into an ever more detailed set of rules. A draft was sent to key stakeholders for consultation, and numerous comments led to changes.

Key changes

The most significant change is that recommendations are now generally worded with “should” rather than “shall”. This is in line with the guidelines in the other Nordic countries and underlines that they are guidance rather than binding rules. Companies that state that they follow the guidelines must nevertheless still comply with individual recommendations or explain any departures from them. The “comply or explain” approach is discussed further in the introduction.

The text has also been simplified. The number of footnotes has been reduced, definitions have been brought together in one place and terminology has been harmonised. Substantive changes include the removal of the specific recommendation that a board member should not chair the nomination committee, and larger boards are given more scope to include more than one executive on the board, provided that executives make up no more than one fifth of board members. The role of the audit committee is framed as assessing the reliability of reporting. In the section on sustainability, the emphasis is on the matters that are material to each company’s operations and on following through on policies, while avoiding duplication in reporting.

New website

At leidbeiningar.is the guidelines can be read in an interactive web version with search and a table of contents. The site also includes an overview of changes since the 6th edition, a report on the review and consultation, further reading and information about the Exemplary Company in Corporate Governance recognition.