Global initiative on corporate governance
World Bank and OECD join forces to push corporate governance agenda.
The World Bank is launching a new corporate governance initiative in September, a move that follows its recruitment drive for accountants and again places the profession at the centre of the battle to ensure that the economic collapse of East Asia is not repeated internationally.
The Global Forum on Corporate Governance is a joint initiative with the Organisation for Economic Cooperation and Development and will bring together international institutions and developing and developed countries, as well as private-sector participants.
The forum is intended to help countries make self-assessments of their corporate governance systems and conduct investor surveys to identify reform priorities. It will support these efforts by drawing on public and private expertise.
The initiative will be led by a private-sector advisory group while, in parallel, a policy dialogue and development forum will be set up to help continue the exchange of views and experiences.
As revealed in Accountancy Age last week, the World Bank is currently recruiting accountants in the recognition that poor financial controls contribute to unstable economies. Vice-president Jules Muis said: ‘We are recruiting dozens of accounting professionals because if we want to make progress in the emerging economies then we have to think about capacity-building.’
The World Bank’s move has not been mirrored in Europe. The European Commission made its position public last month with the release of an action plan for a single market. It said its review of corporate governance would not take place until the end of next year.
One Big Five corporate governance specialist welcomed the World Bank’s move. He said: ‘The provision of capital depends on confidence in the information which people receive and in the way companies are run.
‘The World Bank is obviously very interested in enhancing the standards of accounting and it is quite logical it should be looking for some degree of confidence in governance practices.’
News analysis, page 10.