S and P says Thai companies still lack transparency in post-crisis era

S and P says Thai companies still lack transparency in post-crisis era

Agence France-Presse
Bangkok

The majority of Thailand's bluechip corporations still lag far
behind global standards of transparency, despite efforts for
reform after the 1997-1998 economic crisis, Standard and Poor's
said on Tuesday.

A report by the ratings agency and the National University of
Singapore (NUS) identified problems including poor
accountability, sub-standard disclosure to sharholders and a lack
of independent board members.

"Only six percent (of bluechips) had a majority of independent
directors... while many international boards are advocating more
than 50 percent of independent directors," NUS associate
professor Mak Yuen Teen said.

"Many companies do not evaluate the performance of the board
or directors and only one in five disclosed how much directors
are paid," he said at the report's launch here.

Mak said the widespread use of nominee shareholders by major
investors was also a major problem at many of the kingdom's
listed companies.

"It is a cause for concern if you don't know who actually
controls the company," he said.

The report -- Corporate Governance Disclosures in Thailand: A
Study of SET50 Companies -- revealed the top-five listed
companies all rated significantly higher than the 45 other
bluechips.

The top scorers were Banpu Public Co. Ltd., Electricity
Generating PCL, Kasikornbank PCL, National Finance PCL, and The
Siam Commercial Bank PCL, while lower scoring companies were not
named.

The joint study rated levels of disclosure between four and
140, with the top five scoring between 71 to 80 points, and was
based on information released in company annual reports.

The median score for all 50 companies was 35, with the lowest
firm scoring in the zero to 10 bracket.

While 98 percent of companies disclosed complete lists of
board members, only one third revealed which members were
independent and almost half would not disclose directors'
attendance at board meetings.

"These statistics clearly show that the independence of the
boards of most Thai companies remains lacking, despite the global
trend for more independent boards," the report said.

The report authors are currently working on a study of
Malaysian bluechips due for release at the end of May.