Bangkok--24 Nov--SET
Mr. Charnchai Charuvastr, President and CEO of the Thai Institute of Directors Association (IOD) revealed the results of the IOD Corporate Governance survey that the overall average score of SET listed companies increased from 71 percent in 2006 to 75 percent this year. The SET100 companies perform even better with the overall average score of 83 percent compare to 78 percent in 2006.
“The survey results demonstrate that the corporate governance practices of Thai listed companies have developed significantly. It also reflects that the joint efforts of the SET, IOD and the Listed Companies Association in stimulating good corporate governance practices among listed firms had been fruitful. Especially in the group of SET100 companies that not only attained a higher overall average score, but almost all the SET100 also achieved scores of higher that 70 percent.” Mr. Charnchai said.
On November 21, 2008, the Subcommittee on Investors Education and Public Relations on Corporate Governance in Thailand, The Stock Exchange of Thailand (SET), the Securities and Exchange Commission (SEC), and the Thai Institute of Directors Association (IOD) co-hosted a seminar to release the results of the 2008 survey on corporate governance of Thai listed companies. Mr. Pakorn Malakul Na Ayudhya Chairman of the Stock Exchange of Thailand and Chairman of the Subcommittee presided over the event and gave an opening address. The survey is the sixth since the first survey was initiated in 2001. The survey results were presented in a series of the “Corporate Governance Report of Thai Listed Companies (CGR)”. Over the years, the corporate governance performance of Thai listed companies have continually improved as can be seen from the overall average score that increased from 50 percent in 2001 to 75 percent this year.
In 2008, there were 448 companies scored. A total of 132 criteria grouped in to five categories based on the Organization for Economic Cooperation and Development (OECD) and the SET Principles of Corporate Governance namely, 1) The Rights of Shareholders, 2) The Equitable Treatment of Shareholders, 3) The Role of Stakeholders, 4) Disclosure and Transparency, 5) The Responsibilities of the Board were applied. According to the survey, Thai companies were outstanding in the Disclosure and Transparency, and the Rights of Shareholders categories with the overall average scores of 88 and 86 percent respectively. “However, there is still room for improvement in the category of the Board Responsibility which earned only 57 percent in the overall average score, implying that director education and development will remain a top priority.” Mr. Charnchai added.
This year, about three fourth of the survey companies earned the scores of higher than 70 percent, and there are 22 companies with scores of higher than 90 percent. There are 91 out of 96 SET100 companies surveyed attain higher than 70 percent scores or accounted for 95 percent of the surveyed SET100 companies. The medium and small market capitalization companies also achieved impressive performances, with 76 and 63 percent of companies in the groups attained scores of higher than 70 percent.
“The continuous improvement of the survey results is an evidence of the success of all cooperating agencies in developing the corporate governance practices of Thai listed companies. The achievement is not only on the level of development but also the span, as good corporate governance is now embraced by large and small companies alike. It is a projection of a healthier and stronger capital market indeed.” Mr. Pakorn said.
In this regard, Mr. Thirachai Phuvanatnaranubala, Secretary-General of the Securities and Exchange Commission said that “With this survey in place, investors will have more information for their decision making. Apart from financial information and the company operating result, a long-term investor should also study the company credibility in corporate governance. Currently, the SEC has asked for cooperation from securities companies to publish the corporate governance recognition level the company earned from the CGR in their securities analysis report.”
The survey findings also show that the Thai companies have now been adopted international standard in various practices e.g. about 96 percent of surveyed companies had the board remuneration approved by the shareholders annually, 91 percent of surveyed companies implemented ballot voting at the AGM, and had an internal audit function reporting to the Audit Committee, while 87 percent of companies separated the function of the Chairperson and CEO.
Mrs. Patareeya Benjapolchai, President of The Stock Exchange of Thailand said that “Because of the awareness and efforts made by listed companies to improve their corporate governance, the Thai stock market will gain more credibility and be better at attracting long-term investors. It is very encouraging to see that almost all of the SET100 companies which accounted for about 78 percent of the SET total market capitalization attain a good scoring for this survey.”
Prof. Hiran Radeesri, Chairman of the Project Steering Committee added that “The Corporate Governance Report of Thai Listed Companies (CGR) is now recognized internationally. Four institutes of directors in the region have now adopted the IOD CGR criteria for the survey in their countries.”
For more information, please contact:
Khun Wirawan Munnapinun
Senior CG Analyst
Thai Institute of Directors Association
Tel. 0 2264 0870 ext. 333
Fax. 0 2264 0872