Mon, Oct 03, 2016 page16

• Taiwan fourth in corporate governance report

  REGULATORY ENVIRONMENT: A push for electronic voting for shareholders impressed the ACGA, as well as listed companies’ internal auditing to improve transparency, it said

  • Staff writer, with CNA
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  Taiwan took fourth place in this year’s Asian Corporate Governance Association (ACGA) Corporate Governance Watch report, up two notches from the previous rankings released in 2014, according to the Taiwan Stock Exchange (TWSE).

  Citing the latest rankings, the TWSE said that the total score of Taiwan in the latest rankings stood at 60 points, trailing Singapore (67), Hong Kong (65) and Japan (63).

  Trailing Taiwan were Thailand (58), Malaysia (56), India (55), South Korea (52), China (43), the Philippines (38) and Indonesia (36), the TWSE said.

  Among the 11 Asian markets, Taiwan made the most significant progress in terms of total score in this year’s rankings, rising four points from two years earlier, while the total scores of Singapore, Japan and South Korea rose three points, and India saw its total score improve by one point, the TWSE added.

  The TWSE said that Taiwan’s ranking was the highest level in the nation’s history, which shows that its efforts in bolstering corporate governance in the equity market have paid off and have been recognized by the ACGA.

  The nation made progress in all of the five categories in the overall assessment: corporate governance rules and practices; law enforcement; political and regulatory environment; International Generally Accepted Accounting Principles; and corporate governance culture, the TWSE said.

  The increase in Taiwan’s scores ranged between one and seven points, with progress in the law enforcement and corporate governance rules and practices categories improving seven and six points, respectively, from two years earlier, the largest rises among the five sub-items, it said.

  TWSE vice president Chien Lih-chung (簡立忠) said that the ACGA has been impressed by Taiwan’s push for electronic voting by shareholders, which has boosted corporate governance.

  The ACGA also praised advocacy by Taiwanese authorities for listed companies to set up internal auditing committees and to promptly disclose material information in a bid to improve transparency, which protects the interests of investors, Chien said.

  However, the TWSE said that the ACGA mentioned Mega Financial Holding Co (兆豐金控) — which was fined US$180 million in August when a branch of Mega International Commercial Bank (兆豐銀行) violated New York’s money laundering laws — and its complete lack of a compliance structure.

  The ACGA also noted NAND flash controller supplier Phison Electronics Corp (群聯), which was suspected of falsifying its financial statements.

  Apart from those two examples, Taiwan showed its determination to bolster corporate governance in the past two years so that its ranking in this year’s report improved, the TWSE said.
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