Integrity, ethics are key: executives

While running businesses, personal integrity and corporate governance should be made top priorities to avoid potential financial scandals, business leaders said at a seminar yesterday.

"Good ethics are good business," said Lora Ho (何麗梅), chief financial officer at Taiwan Semiconductor Manufacturing Co (TSMC, 台積電).

TSMC, the world's largest producer of made-to-order chips, regards personal integrity as the single most important quality when considering promotions of top-ranking professional managers, and the company makes thorough reference checks, Ho said at a seminar organized by the Chinese-language CommonWealth monthly magazine yesterday.

Eunice Chiu (邱麗孟), the general manager of Microsoft Taiwan, echoed Ho's views.

She said that most of the company's employees are fully aware of the company's six major management principles, of which honesty and integrity are of primary importance.

Microsoft Taiwan not only insists on financial and management transparency, but also employ compliance officers to strictly enforce the company's standard business conduct, which forbids any insider trading among employees, Chiu added.

Also stressing the importance of corporate values, former state-run Chunghwa Telecom Co (中華電信) chairman Mao Chi-kuo (毛治國) said that an integrity crisis is emerging in the global business community following a series of financial scandals.

He urged all professional managers to re-orient their management focus on business fundamentals instead of share prices.

"No management of a business should be driven by a fluctuation of share prices, which may distort the company's management goals," Mao said at the same seminar.

Securities and Futures Commission Chairman Ding Kung-hwa (丁克華), moreover, stressed the importance of both self-discipline and outside market pressures to ensure business performance.

He said that it is important for the government to facilitate a legal footing and an appropriate mechanism to ensure companies thoroughly follow corporate governance principles while empowering judicial bodies to impose heavier penalties on companies which violate ethical business practices.

Once the Cabinet gives its final approval to the under-study corporate governance stature, the nation's listed companies will be required to appoint outside directors on their boards as independent supervisors to business performance, Ding added.