APEC SOM I on Corporate Governance February, 2001 Beijing

Stephen Cheung Peer Assistance Review Network PECC

Objectives Key governance issues common to economies in East Asia Key governance issues common to economies in East Asia Mechanisms for promoting corporate governance reforms Mechanisms for promoting corporate governance reforms Cooperation and coordination between economies Cooperation and coordination between economies Key initiatives for promoting corporate governance Key initiatives for promoting corporate governance

Observations Need for improvement Need for improvement Different stage of development Different stage of development Stealing is not acceptable in every culture Stealing is not acceptable in every culture

Consultation Process Market Participants Market Participants –Analysts –Funds managers Corporate Directors Corporate Directors Regulators Regulators

Actions 1.A joint distance learning (video conference) with the World Bank Institute, February 2001 Beijing Beijing Bangkok Bangkok Singapore Singapore Manila Manila Washington Washington

Actions The course is designed to highlight: The course is designed to highlight: 1. The importance of sound corporate governance practices at corporate and country levels 2. The economic, financial, and social rewards of sound corporate governance practices 3. The adoption of specific corporate governance practices by regulators and corporations

Actions Three objectives are to: Three objectives are to: 1. Understand the state of corporate governance systems in modern market economies 2. The implications of sound corporate governance systems 3. Acquire skills and techniques in implementing corporate governance improvements through the board of directors and regulators

Action learning approach Action learning approach Interaction with different economies in Asia Interaction with different economies in Asia Local case studies Local case studies Participants Participants –Regulators –Corporate Directors –Academics Actions:

Actions: 2.A working meeting in April, 2001 in Singapore Codes of corporate governance Codes of corporate governance –Survey on the individual Asian economies

Survey Specifically, we ask three questions Specifically, we ask three questions –What elements of existing and planned regulatory arrangements in your economy align with the OECD principles? –In what areas and in what ways do you assess there is a need to modify, add, or remove elements of OECD principles –What elements of the OECD principles are judged to be inapplicable to your economy => Experience of implementation => Experience of implementation

Actions Corporate governance scoreboard Corporate governance scoreboard –Measurement method on the soundness of corporate governance =>To be presented to APEC officials by the =>To be presented to APEC officials by the end of May end of May 2001.

Summary Results for Bank/Publicly-Listed Corporation: ______________________ Date: ______________________ SCORECARD FOR CORPORATE GOVERNANCE Stockholder Rights Weight: 20% Score: Transparency Weight: 20% Score: Total Score 100% Auditing Weight: 15% Score: Commitment to CG Weight: 15% Score: Board Governance Weight: 30% Score:

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