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The corporate governance standards of listed real estate companies across Europe have risen in some areas in the past year, but there appears to be no overall improvement in average performance, a recent survey by the European Public Real Estate Association (EPRA) shows.

EPRA CEO Philip Charls told journalists at the association’s annual conference that the purpose of the survey - sponsored by Deloitte and PGGM - is to assess and compare standards of corporate governance across the European listed real estate sector.

'The survey showed that only 40% of European property companies score above our benchmark 'satisfactory' rating of 9.6 - from a possible maximum of 16 for the 'ideally' governed property company. This result is virtually unchanged from last year’s survey and shows there is still much for the industry to do in terms of debating best practices and raising the bar for corporate governance standards.'

The EPRA Corporate Governance Survey (CGS) reviews European listed real estate governance practices at a country level.

The Netherlands had the highest average governance rating among European countries at 11.1, followed closely by Switzerland and the UK at 10.4 and 10.3. EPRA said this indicated that there is still ample scope for improvement at the country level, even for the more mature markets of Europe.

The variation in governance practices of real estate companies within areas or countries also continues to be significant. For example, in Scandinavia the governance rating ranges from a maximum of 15.3 to a minimum of 4.3 and in the UK from 14.7 to a lowly 4.

Claire Faulkner, real estate audit partner at Deloitte, said at the EPRA news conference that the results showed that the UK companies are setting the standard. 'Dutch companies are the most consistent in producing high-quality reports. But the Germans, Swedish and Greek need to raise the reporting bar.'

EPRA said the two areas with greater need for improvement are executive compensation packages linked to performance and a genuinely independent supervisory board. Only 22% of total managerial compensation was linked to performance in 2008. European property companies adopting the two-tier board structure, where the supervisory board is separated from the management team, is lower than 40%.

EPRA Director of Finance Gareth Lewis said: 'At this critical juncture in the equity markets it is vital that we strive for the highest standards possible for our investors. The EPRA Corporate Governance Survey is all about taking an objective internal look at our industry practices, encouraging discussion on the difficult issues and developing a better understanding of corporate governance practices for Europe's publicly listed property companies.'