HA NOI (VNS) — Enterprises are finding it hard to get an independent board director while authorities find it difficult to punish them for failing to find one.
The Ha Noi Stock Exchange corporate governance scoring programme shows that more than 50 per cent of listed companies on the bourse have failed to fully comply with regulations for an independent management board.
In a meeting here last week, most of the company representatives said they could not find a suitable person while some admitted not knowing what independent board director was. A few were uncertain about how much to pay board directors from outside their respective corporate ladders.
But a majority of businesses acknowledged the important role of independent board directors. In fact, the concept of independent board director is vague in law, so it remains difficult for companies to find a good one outside the corporate hierarchy, said Pham Thi Minh Trang, Danameco pharmaceutical company chairwoman.
A good number of enterprises revealed that the requirements of independent board directors were too high, and those eligible for the title did not understand how companies were run.
After two years of implementing Circular 121/2012/TT-BTC on public company governance, State administrators have yet to fine a company without independent board directors.
A State Securities Commission official told Dau tu chung khoan (Securities Investment) that he sympathised with businesses and could not impose any punishment.
On the other hand, the commission was helping them by proposing changes in legislation and working to establish a training institute on corporate management, the official added.
Meanwhile, starting this month, software giant FPT will hire Tomokazu Hamaguchi of Japan as its independent board director.
Hamaguchi used to sit on the board of NTT Data, the world's sixth largest information technology service provider from 2003 to 2007. He is the second non-executive director of FPT. — VNS