Dually listed Ping An Insurance (Group) Co of China Ltd was crowned the best corporate governance performer among the top 100 Chinese listed companies in a rating released in Beijing yesterday.
The top 100 based on market value as of June 30, 2007, come from 11 industries, with half of them from the manufacturing, transportation and storage sectors. In terms of listing locations, 64 are in Shanghai, 30 in Shenzhen and six in Hong Kong.
The report, co-released by global risk management consultancy Protiviti, the Chinese Academy of Social Sciences and the National School of Administration, is the third such assessment of corporate governance. The first one was released in 2006.
"With the development of China's capital market and improvement in regulations, we have optimized the corporate governance indicators for 2008. This year, we modified four indicators, including the functioning of the board of supervisors, related party transactions, investor relationship and information disclosure," said Lu Tong, a professor with the Chinese Academy of Social Sciences.
"A total of 81 indicators were finally selected, most of which were the same as those used in prior years, thus keeping the indicators consistent overall. The score differential among the top 20 companies is quite small," Lu said.
The report reveals the overall standard of corporate governance remains unchanged within the past year, but the gap between the best and the worst is glaring.
"The self-assessment of corporate governance is more favorable for companies' long-term development. A next step for improving corporate governance would be introducing policies that mandate under-performing companies to improve and reward leading companies for reaching higher standards," said Liu Jianxin, president of Protiviti Greater China.
According to the report, corporate governance standards in State-owned enterprises in 2008 improved significantly compared with 2007. This was primarily due to the efforts of the State-owned Assets Supervision and Administration Commission, which has been proposing and implementing corporate governance plans continuously.
(China Daily May 22, 2008)
