ICC Roundtable on corporate governance in Asia 's emerging markets, 13 October 2004

More than 80 high-level executives from over 20 countries around the world participated in the roundtable. Represented countries included Australia , China , Democratic Peoples Republic of Korea, France, Germany, Indonesia, Iran, Japan, Malaysia, Nepal, Pakistan, Russia, Singapore, Sri Lanka, South Korea, Thailand, Turkey, USA .

The objective of this first ICC Roundtable was to examine business issues related to corporate governance practices and to identify practical ways for ICC and its members to influence progress.  Featuring excellent speakers from business and government and an enthusiastic audience of approx. 80 ICC members and guests, it became clear that ICC can and should play a useful role in further outreach through its commissions.

The discussions were structured by three panels as follow:

Panel 1: International investment perspective: Why corporate governance practices matter in the conduct of business in Asia?

The reform of state owned enterprises makes good corporate governance a top priority for business leaders in Asia in general and Chinain particular.  Key business decisions are increasingly being taken by boards of directors rather than by government officials.  An effective board is a good decision maker.  Recent scandals such as Enron were perceived as perfect models. Indeed, the system looked good in theory with appropriate board sizes, structures, etc. It appears that when the market is performing, corporate governance becomes less prioritized and it is only in periods of crisis that companies start abiding by corporate governance rules.  

Panelists

• Dominic Barton, Managing Director, McKinsey & Co, China.
• G¼ler Manisali Darman, Director, Bilkent Holding, Turkey.
• Eri Habu, Chief Policy Analyst, Policy Research Department, UFJ Institute, Japan.
• Jesse Wang, Vice Chairman, Central Huijin Investment Co., China.

Session moderated by  Maria Livanos Cattaui, ICC Secretary General, Paris.

Panel 2: Viewpoint of Asian companies --- Challenges to strengthening corporate governance in Asian companies.

The increased focus on corporate governance started with the financial crisis in Asia in 1997.  Good corporate governance is critical for the capital markets: today, only 5% of the total capital in the investment market go into Asia . Many corporate governance reforms driven by international organizations have produced little results. Participants made the following recommendations:

-          True and sustainable reform must be market driven;

-          Corporate governance practices should come as a market initiative;

-          In emerging markets a regulatory intervention is often required and government leadership is important;

-          The number of Directors that need to be trained in China alone exceeds 10 000.

Panelists

• Jin-Hwan Chun, Professor of China Studies, University of Incheon, Korea.
• Jamie Allen, Secretary General of the Asian Corporate Governance Association, Hong Kong, China.
• Zhu Gao, Vice President, Minmetals Investment and Development Co., China.
• Bo Li, Partner, Haotian Law firm, China.

Session moderated by  Victor Chu, Chairman, First Eastern Investment Group, China.

Panel 3:Governments in Asian corporate governance: What governmental action is needed to stimulate improved corporate governance?

Good corporate governance needs to be backed by the regulatory framework such as bankruptcy laws. It is difficult to implement and enforce imported legal frameworks, national laws need to be strengthened and well respected instead. Self-regulatory rules are key to a dynamic and performing investment environment. 

Panelists

• Li Qingyuan, Director-General , China Securities Regulatory Commission, China.
• Steven Butters, Managing Partner, Deloitte & Touche Tohmatsu, Asia.
• William Mako, Lead Private Sector Development Specialist, The World Bank.

Session moderated by Wang Jinzhen, Assistant Chairman, China Council for the Promotion of International Trade (CCPIT), China.