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The aim in this study is to discover the nature and extent of corporate governance structures and practices in listed companies in Thailand. This includes a consideration of theoretical underpinning for amendments made to the western models of corporate governance that have been implemented by Thai listed companies, and of the effect of corporate governance principles on financial information, including financial reports, used by stakeholders in Thai listed companies. This study also involves the investigation of the variables for performance measurement related to corporate governance, and recommendation of measures for strengthening corporate governance in Thailand.
Thailand's currency crisis set off a national and regional economic meltdown in the closing years of the twentieth century. Written by Thai economists, this book gives a progress report on good corporate governance practices in listed non-financial companies, financial institutions, state-owned enterprises, and non-listed companies in Thailand.
This book provides an understanding of corporate governance in the context of Thailand. It explains the background and scope of corporate governance in Thailand before and after the Asian financial crisis, and details the roles of the relevant agencies and the key elements of corporate governance for listed companies. The author reviews the assessments made by both local and international organizations and concludes by looking at the challenges ahead and offering policy recommendations for raising the level of corporate governance in Thailand.
November 1998 Weaknesses in corporate governance and the fragile financial structure of many corporations contributed to, and deepened Thailand's recent financial crisis. Large corporations need to reduce their vulnerability to economic shocks and improve corporate governance; smaller firms should achieve a more stable funding structure. Alba, Claessens, and Djankov assess Thailand's policy options for reducing large corporations' vulnerability to economic shocks and improving their corporate governance - and for providing smaller firms a more stable funding structure. Using data for firms listed on Thailand's stock exchange, they empirically assess the relative importance of various factors determining the cost of capital, the availability of financing, and policies and distortions that affect corporate governance in nonfinancial firms. The empirical findings highlight weaknesses in corporate governance and the inherent risks in Thailand's corporate financing structures. They conclude that the most important ask in improving the structure of corporate financing and the framework for corporate governance is to change incentives. This will involve: * Accelerating legal reform, including reform of bankruptcy and foreclosure laws. * Improving bank monitoring of enterprise management and encouraging banks to develop more arm's-length relationships with firms. This will require greater transparency and disclosure of ownership relationships and stricter enforcement of insider and related lending limits, violation of which contributed poor intermediation and the recent crisis. * Improving disclosure and accounting practices. Self-regulatory agencies may need to play more of a role, possibly with more legal power to discipline violators. * Better enforcement of corporate governance rules. The formal structure for corporate governance is standard but enforcement is weak. * Facilitation of equity infusions. Investors - especially minority shareholders - may need to play a more direct role in monitoring and disciplining managers. To attract new infusions of equity, new equity owners may need more-than-proportional representation on the board of directors until other investor protection mechanisms are strengthened. * Improving the framework for corporate governance. A broad public discussion of corporate governance, similar to recent discussions in the United Kingdom and elsewhere, may be needed to clarify the distribution of control in the economy's real sector. * Strengthening institutions responsible for gathering and analyzing data on firms of all sizes and for monitoring firm performance and behavior. This paper-a product of the Economic Policy Unit, Finance, Private Sector, and Infrastructure Network-is part of a larger effort in the network to study the performance and financing structures of East Asian corporations.
This study examines how incentive conflicts and the quality of corporate governance practices in Thai family firms influence firm value. We hypothesize that the agency conflicts between majority and minority shareholders in Thai family-controlled and family-managed firms (Type II Agency Problem) are more serious than the incentive conflicts between insiders and shareholders in widely held and professionally managed companies (Type I Agency Problem) in Thailand. This is because of the weak protection for the rights of minority shareholders in Thailand and the opaque and poor governance practices that are facilitated by extra-contractual relationships between controlling families and directors. Supportive of our conjecture, we find that q values are significantly lower for firms with high family control and family management compared to q values for low family control and non-family managed firms. Further, we find, for our sample of Thai firms, that while conventional governance variables such as board size and independence have no association with q, a more in-depth assessment score, that better captures actual governance practices, has a positive association with q only for high family control and family-managed firms. We interpret our results to be consistent with the notion that family firms can compensate for any potential adverse impact of control on value through improvements in corporate governance practices.
The objective of this research is to study the factors of good governance scores and accounting performance affecting the P/E Ratio for listed companies in the Stock Exchange of Thailand. The research methodology is multiple regression analysis for the data analysis. The accounting performance is tested as the mediator variable according to Baron & Kenny's concept (1986) by using the sample group consisting of the listed companies in the Stock Exchange of Thailand from 2012-2016. The data used in the study are a total of 1,710 data. The results of the study conclude that the factors of good governance scores have positive influence on the price-to-earnings ratio. For testing the mediator variables, it is found that the accounting performance is not the mediator variable between the good corporate governance scores and price-to-earnings ratio at the statistical significance level of 0.05.