Corporate Governance in the Caribbean Environment
“The Caribbean Corporate Governance Forum”
Trevor E Blake General Manager – ECSE
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Corporate Governance Corporate Governance is Important!
Strong governance framework facilitates economic development by
Strengthening market discipline Improving business transparency Enhancing Disclosure Enhancing effective Regulation Enhancing Corporate Social Responsibility
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Corporate Governance Strong governance framework
assists governments and regulators to
monitor markets identify risks impose appropriate regulations that
encourage growth and fair competition
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Genesis of CCGF ECSE/ECCB collaborate to launch
Caribbean Corporate Governance Forum
Recognition that CG integral to development of money & capital markets
Calls for transparency and accountability Emergence of international CG standards Investors’ demands for governance
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CCGF Caribbean Corporate Governance
Forum (CCGF) A pan Caribbean forum
committed to promote good CG standards in the region
Initiated to bring the Caribbean into global CG debate
Synthesis of ideas into regional consensus
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CCGF Objectives Raise CG profile in region Identify relevant development
issues Assess current activities in
region To form a regional network To establish regional consensus
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CCGF Activities 1st regional roundtable held Sept ’03
120 participants from 16 countries Discussion areas included
global trends and implications for emerging economies
Caribbean corporate governance challenges Institutional investor, regulatory, securities
markets & corporate perspectives governance issues for banks, nbfis, public
companies, state corporations & SMEs
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CCGF Activities Creation of Caribbean Technical
Working Group on CG (CTWG) A grouping representative of various
countries, sectors, industries and professions
to promote implementation of initiatives determine priorities for implementation
Major achievement - Draft Corporate Governance Principles
for Caribbean Countries
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CCGF Activities 2nd regional roundtable in March
’05 170 participants from 20 countries Focus on CG reform Review CG Principles Issued a Statement of Principles
CTWG to develop full set of Principles Principles to be disseminated across
region for comment National consultations
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Caribbean CG Principles Principles focus on 6 broad
areasI. Objective & basis for Caribbean CG
framework II. Shareholder rights and key
ownership functionsIII. Equitable treatment of shareholdersIV. Role of stakeholdersV. Disclosure and transparencyVI. Board responsibilities
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Caribbean CG Principles
Meet international standards Focus on publicly held
companies Relevant to private, family &
state enterprises Encourage stakeholder rights Recognise unique
circumstances of region
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Caribbean CG Principles
Suited to region’s state of development
Support integration movement Non-binding and non-
prescriptive Basis for development of
national and/or sector specific codes
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CG Training Initiatives Programmes to raise CG
awareness and strengthen pool of directors
2-day introductory Directors’ course & 1-day Chairpersons workshop held in June ’05, to promote
best practices ethical, transparent practices formal training production of Personal Action Plans Duties & responsibilities of Chairman
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Way Forward Principles placed on Agenda of
CARICOM Heads of Government meeting
PM Anthony of St Lucia, responsible for Justice & Governance
National Adoption of the Corporate Governance Principles, in entire region
Development of country, sector and industry codes
Director Certification Training
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Contact DetailsEastern Caribbean Securities Exchange
LtdP O Box 94Bird Rock, St KittsTel: 869 466 7192 Fax: 869-465-3798E-mail: [email protected]: www.ecseonline.comCG page: www.ecseonline.com/
corporategovernance.asp
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Draft CG Principles Principle I – Overall Objective
The corporate governance framework within the Caribbean should
encourage the development of transparent and efficient markets,
have its basis in the rule of law and ethical standards to foster the division of responsibilities among supervisory, regulatory, and enforcement bodies.
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Draft CG Principles Principle II – Shareholder Rights
The CG framework should protect and facilitate the exercise of shareholders rights.
Principle III – Equal Treatment of Shareholders
The CG framework should ensure the equitable treatment of all shareholders, including minority and foreign shareholders.
All shareholders should have the opportunity to obtain effective redress for violation of their rights.
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Draft CG Principles Principle IV – Rights of other Stakeholders
The CG corporate governance framework should
recognise the rights of stakeholders established by law or through mutual agreements
encourage active co-operation between entities, including family owned businesses and state-owned/controlled enterprises, in creating wealth, jobs, and the sustainability of financially sound enterprises.
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Draft CG Principles
Principle V – Disclosure and Transparency The corporate governance framework
should ensure that timely and accurate disclosure is made on all material matters relating to the entity, including its
financial situation performance ownership governance
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Draft CG Principles Principle VI – Board Responsibilities
The corporate governance framework should ensure
the strategic guidance of the entity the effective monitoring of its
management by the Board the Board’s accountability to the entity
and to stakeholders.