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Good Corporate Governance Critical for Development

22 June 2006

Companies which exercise good corporate governance can lead the way in building confidence among national and international investors, particularly in small states,

 said Commonwealth Deputy Secretary-General Winston Cox. He stressed that good corporate governance enhances financial stability and the orderly development of capital markets, which reduces the risks to the financial system.

He made these points in a video-taped speech on 17 June 2006 at the opening of a Commonwealth workshop in Malé, Maldives, on 'Developments, Structures, Capacity and Roadmap for Enhancing Corporate Governance'. The two-day workshop was funded by the Commonwealth Fund for Technical Co-operation and the Global Corporate Governance Forum. It was attended by more than 20 senior officials from Commonwealth governments and development agencies.

The Deputy Secretary-General pointed out that progress in good corporate governance in Commonwealth Asian countries has not been even, with some taking great strides but others seeing very little development. He said emerging economies like those in Commonwealth Asia need to put in place policies to sustain national institutions, economies and societies to meet the challenges of globalisation.

"Corporate governance is no longer the domain of specialists in the investment community and company directors; it is also the concern of policy-makers, legislators and citizens," said Mr Cox.

The workshop, he said, would help to develop a roadmap for improving the standards of corporate governance in Commonwealth Asia. Mr Cox stated that the Commonwealth Secretariat's efforts to promote good corporate governance focus on strengthening the capacity of companies and countries to compete in the global economy, promoting a positive post-privatisation environment and strengthening anti-corruption efforts. It also helps to facilitate the corporate sector's contribution to people-centred development through the promotion of better corporate citizenship.

"Improving organisational performance, maintaining environmental and social responsibility and conforming to international standards are all essential aspects of good corporate governance," said the Deputy Secretary-General. "Many countries have taken a number of actions to improve the knowledge, standards and capacity for corporate governance, and to extend corporate governance to public sector development as well."

Mr Cox said the principles, standards and guidelines provided by the Secretariat and other development organisations have helped member countries to benchmark practices and establish milestones for progress.

CNIS - Commonwealth News and Information Service Issue 290, 21 June 2006

 

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