Association of Chartered Certified Accountants: ”Asia’s Corporate Governance Journey Gathers Momentum”

Comment by Nicholas Benes:  Asia in general has seen significant improvement in corporate governance practices and standards over the past 10 years, even if there is much room for further improvement, as is described in this insightful article by the Association of Chartered Certified Accountants (ACCA) referred to below.  The very fact that there is much more to analyze (than before) when anyone tries to “rank” governance practices in various countries, is indicative of this.  In particular, I find it especially interesting that the self-interest of certain family dynasties has caused them to have strong interest in better corporate governance because “because there is a corollary for him between good governance and the long-term future of his corporation. ” See below.

Quote:  “If there is one region in the world that could benefit from a rationalisation of corporate governance structure, it is surely Asia, with its shifting sands of complex company ownership structures. Globalisation has only increased the size of subsidiary/parent relationship webs and has helped prompt the release in November 2015 of an updated version of the G20/OECD Principles on Corporate Governance. Many major events have occurred since they were last revised in 2004, not least the global financial crisis and the long, hard look in the corporate governance mirror that followed…..

Yet increasing attention is being given to corporate governance in South-East Asia and often from surprising quarters, according to Irving Low, partner and head of risk consulting at KPMG Singapore. ‘I know of one Thai business that has been taken over by the head of a wealthy family who is very focused on good corporate governance because there is a corollary for him between good governance and the long-term future of his corporation,’ he says, adding that this approach resonates throughout the region. ‘Heads of family dynasties that control Asian corporations believe that if corporate governance is good, then their children will have a framework that will ensure the corporation will pass onto the next generation and be a sustainable entity. When children are not automatically entitled to a business, this makes the business sustainable, and this is a common sentiment I have heard.’….”

Read full article here.

Source:  Association of Chartered Certified Accountants (ACCA)

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