Asia lacks corporate governance

Asia lacks corporate governance

SEOUL (Reuters): Good corporate governance does not conflict
with Asian values or the values of any other region of the world,
a senior official of the Organization for Economic Cooperation
and Development (OECD) said on Wednesday.

"One can overplay the question of Asian, non-Asian or Western
values," Joanna Shelton, OECD deputy secretary-general, told a
news conference.

A lack of corporate governance, or transparency and
accountability, was a fundamental cause of the Asian crisis and
the spread of the crisis elsewhere in the world, she said.

"Some of the phenomena we see are not unique to the Asian
situation," Shelton said.

The countries hit by the crisis had weak corporate governance
in common, she said.

Enhancing corporate governance so that systems and markets are
open to all is a crucial part of preventing another crisis, she
said.

"Increasingly in the globalized world, if companies wish to
attract and keep investments from outside the companies, this
model of a closed, insider system of managing companies is no
longer sufficient," she said.

Crisis-hit countries should improve corporate disclosure and
transparency and take steps to enhance protection of
shareholders' rights, she said.

An effort also should be made to improve bankruptcy and
insolvency laws so that companies can exit the market smoothly,
she said.

Shelton was in Seoul for an OECD conference on corporate
governance.

OECD ministers requested last year that the organization
develop guidelines on corporate governance, and those guidelines
are expected to be finalized at this year's OECD ministers
meeting in May.