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Corporate governance praise for telecom firm

By Zheng Lifei (China Daily)
Updated: 2006-04-20 07:09

"The problem is that many Chinese listed companies are still not used to actively communicating with shareholders and the public," said Lu, also the director of the Chinese Center for Corporate Governance at CASS.

Chinese public firms, however, performed poorly in fields such as shareholders' rights and responsibilities of board directors, two areas that are considered vital for sound corporate governance, the rating report noted.

"In those areas, even China's top 100 listed companies have a long way to go," said Lu.

"It is in those two areas that Chinese listed firms should do the most in order to refine their corporate governance," the professor said.

"Compared with pressure from the regulators, the capital market force is still weak in terms of pushing listed companies to improve their corporate governance behaviour," said Zhou Shaopeng, a corporate governance expert at China National School of Administration.

It is the second annual corporate governance rating report to be released. Sinochem International Corporation, a Shanghai-based chemical company, was the winner of last year's rating and ranked sixth this year.

The ongoing share merger reform began last year to convert the listed companies' non-tradable shares into tradable shares, the report says the reform "has laid a solid foundation for public companies to further improve their corporate governance."

"However, to have in place a sound corporate governance will be an arduous task," the report warned.

(China Daily 04/20/2006 page9)