Corporate governance in Thailand: What has been done since the 1997 financial crisis?

Abstract

The study finds that Thailand has taken many steps to improve its corporate governance, including voluntary approaches such as best practice guidelines for board of directors (BOD) and audit committees, and corporate governance rating; and mandatory approaches such as enhancing the rights of minority shareholders and creditors, increasing the board of directors' accountability, making accounting and auditing standards consistent with the internationally acceptable standards, and strengthening the enforcement of securities regulation. This study also provides suggestions for further improvement with respect to minority shareholder protection and education, the responsibilities of the BOD versus the top management, the BOD structure of financial institutions, further amendments to the new Bankruptcy Act, the need for whistleblower law, the valuation of certain assets, and the compliance with the Buddhist precepts. In addition, the Thai government needs to improve the checks and balances of its own governance process and its ‘populist’ policies. These findings and suggestions have direct implications for other developing countries which are attempting to improve their corporate governance.