Thailand again tops regional rankings - Corporate Governance

Thai listed companies maintained their foothold as the best performer in corporate governance (CG) against five Asean peers, with an average score of 75.39 points for 2013-14, followed by Malaysia at 71.69 and Singapore at 71.68. 

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The average score of Thailand’s top 100 companies by market capitalisation rose sharply from 67.66 in 2012-13, said Bandid Nijathaworn, president and chief executive of the Thai Institute of Directors.

Of the 529 Asean listed companies participating in the survey, four Thai firms are ranked among the top 10 and 18 among the top 50.

The six Asean stock markets in the survey are Indonesia, Malaysia, the Philippines, Singapore, Vietnam and Thailand.

Areas where Thai listed companies recorded the highest average scores were rights of shareholders at 8.62 points out of 10 and equitable treatment of shareholders at 14.24 out of 15, while Thai listed firms ranked third in the role of stakeholders, disclosure and transparency, and board responsibilities, reflecting considerable room for further improvement.

Malaysia gained the highest score in stakeholders’ role at 5.88 points out of 10. Singapore ranked highest in disclosure and transparency at 17.4 out of 25 as well as in board responsibility at 26 out of 40.

"It's good news that the total scorecard improved by eight points, but other Asean countries could improve their CG scores pretty fast. Thailand must continue to improve its CG level, especially in disclosure and transparency," said Mr Bandid.

"There are still several areas that Thai listed firms must develop to enhance credibility of the Thai capital market, especially in corporate governance standards improvement, both in form and substance, as well as reporting progress. These moves will bolster the confidence of both local and foreign investors."

For the role of stakeholders, Thailand still lacks disclosure of practices dealing with customers' welfare, supplier selection, an environmentally friendly value chain, communities interactions and creditors’ rights. Information disclosures about employee rights are also required.

Mr Bandid said for disclosure and transparency, the board and senior management should disclose their direct and indirect shareholdings of the trading company’s shares. The annual report should disclose the corporate objective and non-financial performance indicators.

There are many areas to improve on board responsibility such as disclosure of a code of ethics along with implementation and monitoring as well as review and monitoring of corporate strategy implementation, he said.

SET chairman Sathit Limpongpan said: "The SET has constantly encouraged listed companies to meet global standards on business expansion and quality. The Thai bourse has become one of the region’s leading capital markets."

Source: Bangkok Post