State firms face hard and long road to go international
State firms face hard and long road to go international
JAKARTA (JP): The plans of several state-owned companies to
list shares on the international stock exchanges must be
carefully prepared due to extremely high standards set by
international markets and tight competition for foreign capital,
an American business analyst cautioned over the weekend.
Georges Enderle, a professor of international business ethics,
from the University of Notre Dame, Indiana, U.S., said the
Indonesian government and its companies must meet several tough
requirements for share listing.
"First, a company must be transparent in its financial
activities and reports if it is to be listed on an international
market." Enderle told The Jakarta Post after a presentation at a
seminar on international business ethics here on Saturday.
Then, the company must have had a good financial performance
for the past few years since investors on the international
markets prefer financially promising companies, he added.
PT Indosat, a state-owned company which specializes in
international telecommunications services, is now preparing to
list a portion of its shares on the New York Stock Exchange.
Enderle said investors will also ask for comprehensive
information on Indonesia, about where its government policies are
heading and about possible risks they would face if they invested
their money here.
He conceded that although Indonesia's economic management and
performance have often been commended by the World Bank, the
country is not well-known on the international financial market.
Indonesia must promote itself to become internationally
recognized, he added.
Another problem is that Indonesia is not the only country in
the world preparing to privatize its state-owned companies.
Business ethics
Enderle said in the seminar, which was organized by the Kompas
daily in cooperation with the Management Institute (LPPM), that
international business ethics rose to prominence after the U.S.
Congress revealed cases of international corruption such as the
Lockheed affairs in 1975.
The affairs, which involved several countries' leaders,
including Prince Bernhard of the Netherlands and Japan's former
prime minister Kakuei Tanaka, were related to alleged briberies
involving the American airplane manufacturer, Lockheed.
Enderle said business ethics are also influenced by economic
thinking and acting, which penetrate and dominate more and more
domains of life.
Enderle observed that individual or institutional investors in
international markets will select companies which meet adequate
standards regarding environment, health and safety, human rights
and legal practices.(02)