Interview with Vassiliki Lazarakou, Chair, Hellenic Capital Market Commission (HCMC)

Interview with Vassiliki Lazarakou, Chair, Hellenic Capital Market Commission (HCMC)


How has Greece managed to turn around its economy after the deep, decade-long crisis? How resilient has the economy been in the face of the latest crises from COVID-19, the Ukraine war, rising inflation and the latest climate events?

The Greek economy appears to be maintaining the strong momentum created in recent years, in a highly volatile and uncertain international environment, due to a number of adverse international factors. This remarkable improvement has been achieved thanks to a steady and long-term reform policy, based on transformative actions and increasing foreign investments, combined with tax and social security contributions reductions. Leading technology giants, such as Microsoft and Amazon Web Services are showing strong interest in our country as an investment destination, making modern and innovative investments that generate new and well-paid jobs. At the same time, the recovery of the investment grade, as well as the general restoration of international investors’ confidence in Greece, is a decisive element for the cultivation of a positive economic climate and the creation of a virtuous growth cycle.

In general, a very important modernization effort has been taking place, which is moving steadily and consistently in a specific growth direction, aiming to release our productive forces. This is confirmed by the competitiveness index of the Greek economy, as recorded by international organizations, with Greece constantly rising in the relevant ranking.


What key milestones has HCMC passed in recent years to support the public market? How is HCMC working hand in hand with the government to ensure the economic success of the private sector?

In this highly volatile and uncertain period, ensuring the smooth operation of the market and the protection of investors is more critical than ever. HCMC’s missions is to serve society as a whole and to boost the Greek economy, by responding to such crises. From the first moment of our term, having as a main concern the smooth operation of the market and the protection of investors’ interests, we set three major priorities at the national level and one at the European level. These are: Contributing to the revision of national legislation, with the aim of ensuring the more efficient operation of the capital market; leveraging new technologies; enhancing prudential supervision. At the European level, our ambition, which has been materialized, was to strengthen our participation in European institutions, in support of fundamental European objectives.

With respect to the regulatory framework, it is important to note that EU capital markets law is applicable in Greece as well. Thus, our contribution related only to national legislation which is mainly corporate governance rules as well as the adoption of new products where the legislation leaves such room. One of the first actions of HCMC was in relation to the amendment of the corporate governance framework.

Following a proposal by HCMC, a new law on corporate governance (law 4706/2020) was adopted which is in alignment with international best practices and the OECD principles. Regulatory decisions implementing such framework were also issued by HCMC as well as Q&As assisting in the interpretation of the law were issued to assist the smooth transition to the new framework. At present, Greek listed companies operate under the new corporate governance framework which is in alignment with international best practices.

HCMC also proposed a quota of 25% for the underrepresented gender to be included in such law, something which was accepted. Therefore, after the implementation of such law, the percentage of women participating in the boards of listed companies rose more than doubled from 13% in late 2020 to 27% by September 2023.

With respect to our second goal regarding digital transformation, we have launched the entry of the Commission into the digital era, a crucial project that will be funded by the Recovery and Resilience Facility (‘Greece 2.0’), while important initiatives have also been taken in relation to our third goal. At the same time, the activity of HCMC places particular emphasis on actions that contribute to the development of the domestic capital market, the extroversion of the Greek economy and the international presence of HCMC.

With respect to the development of the Greek capital market, our priority has been to facilitate the financing of the real economy. We have proceeded to several actions. Specifically, we have taken specific strategic decisions to assist the enhancement of the regulatory framework and the growth of the market. Indicatively, regulatory decisions were issued by HCMC, simplifying the process of approval of prospectuses in case of IPOs, or rights issues or listing of corporate bonds. Also, prospectuses can now be submitted in English to assist combined offerings in Greece and other jurisdictions.

The HCMC has also been working on innovative interventions in the operation of the capital market, as a growth driver for the Greek economy, through the analysis of new products that, if properly designed, could contribute to the capital market’s operation as an alternative source of financing. In this context, and for the first time since the establishment of the HCMC, HCMC also issued its five-year strategy (2022-2027), which clearly defines the road map to be followed to successfully accomplish our objectives. This strategy sets out the long-term strategic direction, includes short- and medium-term strategic objectives and defines its mission and core values.

It must also be noted that HCMC supports EU initiatives such as sustainable finance, supervisory convergence and others. In these actions, HCMC is working closely with the government, with a view to the overall upgrading of the economy. Furthermore, Greece has designed a broader national strategy, to strengthen the capital market. This strategy aims to re-establish a developed, competitive and dynamic capital market for the long-term development of the economy.


What new trends in mergers and acquisitions are we now seeing? How is Greece moving away from traditional economic pillars towards more innovative sectors such as Fintech?

In terms of recent developments in the Greek capital market and the financial sector, the deal between Alpha Bank and Unicredit, as well as the successful sale of the 22% of National Bank of Greece (NBG) share capital held by the Hellenic Financial Stability Fund (HFSF), for €1.07 billion, stands out. NBG’s transaction is the largest privatization in Greece in recent years through a secondary placement of shares.

Generally, the Greek capital market is recording strong growth, attracting the interest of the international investment community, driven by the strong performance of the economy and the promising investment climate in the country. Emphasis has been placed on the new technologies sector and the digital transformation of the Greek market, with the prospect of full automation in due course.

These modern trends are also inextricably linked to the new capital market development strategy, which aims, among other things, to expand investment opportunities and to promote the strong growth of the Fintech and ESG ecosystems.


What guarantees and protection mechanisms exist for local businesses from SMEs to large corporations? How would you assess access to funding, talent and support ecosystems, and what improvements could be made?

In recent years, the implementation of investments here has been significantly facilitated, because of several factors, such as the significant reforms that have taken place, the reduction of taxation, the promotion of digital transformation, as well as the simplification of various bureaucratic procedures. Other factors like political stability or delivering on strategic goals, can be considered as contributing significantly to the change of perception as to the ease of doing business now in Greece.

Moreover, the government is placing more and more emphasis on SMEs and the expansion of their access to financing, the strengthening of new entrepreneurship, and the empowerment of extroversion.

With respect to the capital markets, HCMC proposed the adoption of a new alternative investment fund (AIF) to be used as a vehicle for investments. However, such new type has not been used in practice. In my view, one of the next issues that the national strategy of the capital markets should further tackle is the one relating to the access of financing by SMEs. The Athens Exchange has already announced changes in the Alternative Market to make it more attractive to SMEs.

Certainly, there is room for improvement, both in terms of creating new funding mechanisms, which is also an aim of the Capital Market Union, but also in terms of creating a coherent innovation ecosystem that will create new and well-paid jobs.

Greece should focus on the creation of such innovation ecosystem and assist in their financing through the capital markets, but this is a broader issue that relates also with the connection of education with the labor market – something which should be a priority now.


How would you assess the country’s progress when it comes to transparency and good governance? Recent regulatory changes and their impact. What remains to be done? What is HCMC doing to ensure companies comply and are transparent in their operations?

As mentioned before, following a proposal by HCMC, a new law on corporate governance (law 4706/2020) was adopted which is in alignment with international best practices and the OECD principles. Therefore, there is a significant progress in the way Greek listed companies operate currently. Considering Greek companies have adjusted to the new legislation, the level of corporate governance and transparency has been raised significantly.

HCMC is the competent body for the supervision of the compliance of listed companies with the new corporate governance legislation. Initially, we were assisting companies to make sure that they have understood the relevant framework, while after its application, HCMC is monitoring their compliance. We proceed to audits where necessary, which means if a company is found to breach legislation, relevant sanctions are imposed.


How significant is the move towards ESG and green investments for Greece? What is the local government and the EU doing to incentivize these investments? What potential do new sustainable sectors such as green energy have here?

This is one of the most significant issues nowadays. The EU, in the context of the European Green Deal, has set the emblematic goal of making Europe the first climate-neutral continent by 2050. The government is pursuing a comprehensive national energy and climate plan, and launching actions and initiatives to promote large-scale projects that favor green development.

For the Greek economy, the implementation of sustainable investments and the promotion of sustainable growth is of great importance. In recent years, there has been a significant penetration of renewable energy sources projects in the energy mix, with multiple economic and environmental benefits. In addition, investors and all stakeholders in general attach great importance to the compliance of modern listed companies with ESG criteria, rewarding socially and environmentally responsible organizations, characterized by good governance and transparency in the way they operate.

Furthermore, we must stress that EU law, such as the Non-Financial Reporting Directive (NFRD), and Article 8 of the EU Taxonomy require companies to proceed to disclosure regarding their non-financial information. HCMC plays a leading role in this field, both at national and international level, by contributing to the shaping of the relevant European regulatory framework through, inter alia, its active participation in the European Securities and Markets Authority (ESMA). In this respect, HCMC has initiated timely an intensive process of raising awareness of the regulatory framework and the ESG characteristics, among all market participants and the public.


How important is North American investment to Greece? What are the main areas of interest for US investors, and what is HCMC doing to work hand with US and other international investors?

The direct net investment that came to Greece in 2022 was the highest in 20 years, a very positive trend that continued into 2023. At the same time, the recovery of the investment grade sends a strong message abroad, contributes to the goal of moving the Greek stock market to the developed capital markets and attracts the interest of international investors.

Furthermore, Greece’s return to a positive economic growth path, as mentioned above, has attracted the investment interest of major US companies, such as Applied Materials, AWS, Cisco, Deloitte, Digital Realty, Google, JP Morgan, Meta, Microsoft, Pfizer, and so on, which are already implementing significant investments. In addition, the removal of Greece from the list of countries with unsatisfactory intellectual property rights (IPR) performance in 2020 has contributed significantly to the increase in the interest of American companies in our investment climate.

For its part, HCMC is working systematically to ensure that all investors are treated fairly and that rules and regulations are respected by all market participants. HCMC also, through its participation in the boards of ESMA and IOSCO ensures that supervisory convergence is a high priority for the Greek market and through its participation in the bureau of the OECD Corporate Governance Committee that good corporate governance principles are followed in our market.


What is your final message to the readers of USA TODAY?

Greece is currently among the EU countries with the highest growth rate, a level which is expected to be repeated in 2024. This is an indicator that the Greek economy will continue to show remarkable resilience and strong growth potential. The same applies to the capital markets, especially after the investment grade. We should continue our reforms.

HCMC is determined to contribute to the creation of a sound and efficient framework for the Greek capital market, which will facilitate the attraction of FDI with a view to making Greece a regional financial center in southeast Europe.