A draft report on the code by the Directorate of Investment and Company Administration (DICA), Securities and Exchange Commission of Myanmar (SECM) and Organisation for Economic Co-operative and Development (OECD) is expected to be ready this year.
An MOU to draft an official Corporate Governance Code was signed in November last year with the aim of improving corporate governance standards in Myanmar, which, in turn, will support the further development of the country’s capital markets.
“We will need a strong framework to effect strong corporate governance standards for Myanmar companies. A Corporate Governance Code which conforms with the current conditions of Myanmar is expected to be ready in 2020,” said U Aung Naing Oo.
He urged public-listed companies, public companies and private companies to start preparing their businesses for more stringent corporate governance standards in the months to come.
Strong corporate governance in domestic companies is important for attracting foreign direct investments. In India and Thailand, for example, regulators have been pushing for strong corporate governance in the last few years to strengthen investor confidence.
Currently, the corporate governance structure in Myanmar is still relatively undeveloped, with poorly functioning boards, antiquated management control processes and low levels of transparency.
But reinforcements are on the way. The Myanmar Institute of Directors, for example, has set benchmarks for corporate governance practices among Myanmar companies and aims to support corporate boards of directors in achieving loftier standards of transparency.
Things have been slowly improving. In its 2019 Pwint Thit Sa report launched last month, the Myanmar Centre of Responsible Business revealed that some Myanmar companies have shown good understanding of how good corporate governance and transparency can improve business.
On the other hand, 44 percent of the 248 companies assessed still did not have corporate websites and published little or no information on corporate governance and performance data.
The report assessed website disclosure of information based on the corporate profiles, corporate governance, sustainability management processes and reporting of 248 large Myanmar enterprises, including five listed companies, 55 public companies, 160 privately-owned companies and 28 of the most important state-owned economic enterprises in Myanmar.