The majority of small and medium sized companies in Italy are traditionally family owned sometimes running from one generation to the next.

In order to convince these companies to list more shares on the stock market without owners necessarily losing control, a law was introduced last year allowing companies to amend their bylaws (statuto) to grant longer-standing investors multiple votes for each share they own.

On Thursday 5th February, under pressure from foreign investors, the Italian government rejected a proposal to extend the simple majority rule until the end of 2015. From February a two-thirds majority is needed to introduce the loyalty share scheme. This is evidence that the government wants to be perceived serious about attracting international investment and safeguarding international standards of good governance.