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Report
www.cipe.or
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The Private Sector and Building
Effective Demand for Corporate
Governance
Caribbean Corporate Governance Forum
September 2003
Supply and Demand
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Supply
Securities
Commissions
Stock Exchanges
Other
Regulatory/Fiscal
Authorities
OECD
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Demand
Companies
Shareholders
Investors
Banks
Phases of Developing
Demand
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6.
Initial Assessment
Organizational Development
Making the Case
Building Human Capital
Public Policy Reform
Consolidation
Key Institutions Must Function
Well
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Procedures for bankruptcy
Property rights
Contract enforcement – judicial system (s)
Enforcement mechanisms
Securities markets
Free press – financial press
Ratings agencies et al
Other systemic checks and balances
1. Initial Assessment
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Assess corporate governance failures
Rate country standards vs. best practice
Adapt OECD principles (+ national needs)
Build awareness at senior business and
policy levels
• Identify stakeholders
2. Organizational
Development
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Private sector associations
Institute of Directors
Investor protection associations (s)
Think tanks and other private sector
institutes
• Create corporate governance within civil
society, business, and regulatory bodies
(coalitions, national task forces)
3. Making the Case
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What is Corporate Governance – country by
country
Codes and tool kits adapted for the country
Ratings systems for investors
Benefits to stakeholders – investors, block
shareholders, family firms, employees, banks
Impact on economic performance (cost of
non-compliance)
4. Building Human Capital
• Training and certification programs for
managers and directors (IOD)
• Investor education
• Firm level programs
• Journalism education
• Professional development programs for
Parliamentarians, regulators, judiciary,
accountants, etc.
5. Public Policy Reform
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Policy seminars and conferences
Policy papers and research
Provide experts / case histories
Make specific policy recommendations
Draft legislation, regulation, standards
Advocacy campaigns: key contacts,
opinion editorials, public events,
petitions, grassroots
6. Consolidation
• Further strengthen shareholder rights groups
and Institutes of Directors,
• Risk ranking by ratings agencies.
• Reports on Standards and Codes (ROSC)
• Legal and institutional enforcement – tracking
and reporting performance by public and
private sector.
Evaluation of impacts
Case Study: Columbia
Confecamaras
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Phase One
Corporate Governance Code
Corporate Governance Survey
Corporate Governance Training
Legal Advocacy
Government Advisors
Diffusion Tools
Case Study: Columbia
Confecamaras
Phase Two
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Corporate Governance: Face to face program
• 10 companies have been helped to adopt Corporate Governance
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Developing Literature
• White Book of Corporate Governance: Respond to the lack of literature in
Spanish
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Diffusion Tools
• Website, E-Bulletin: 4000 subscriptions
• Documentary Center
• Corporate Governance Contest
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Legal Advocacy
• Corporate Governance for Mutual Funds
• Labor Law
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Training Programs
• Cali, Medellín and Bogotá
• Work with MBA´s of University of Andes
Case Study: Poland
Too Much competition?
• Competing interest groups
– Insiders:Stock Exchange and Large Firms
– Outsiders : Think tank, Investors
• Competing codes
• “Rush to judgment” –premature ratings
• Unclear outcome
CIPE Program for Latin
America and Caribbean
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New effort supported by USAID
Training
Intra-regional Networking
Small Grants for Institutes and
Business-led initiatives.

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