HÀ NỘI — Firms should attach importance to corporate governance to improve their competitiveness and develop sustainably, experts said.

A recent survey by the Việt Nam Chamber of Commerce and Industry (VCCI) on 400 firms, including limited liability, joint stock and foreign invested companies, revealed that only 23 per cent announced both financial and annual reports while 30 per cent did not publish any.

The findings indicated that Vietnamese firms had not paid enough attention to enhancing their corporate governance.

Other figures revealed that the governance capacity of Vietnamese firms was low, at an average score of 35.1 points in 2014 for listed companies, compared to Thailand’s 84.5 points, Malaysia’s 75.2 points, Singapore’s 70.7 points and Indonesia’s 57.3 points.

Experts said that despite a huge rise in the number of new firms in 2016, competitiveness of businesses remained an issue, with weak corporate governance among the causes.

 “Corporate governance is like the heart of a company, proportional to its sustainable development,” Vũ Bằng, Chairman of the State Securities Commission said.

Corporate governance plays a crucial role in sustainable development of firms, helping to ensure transparency, attract investments, improve efficiency and handling internal disputes smoothly.

“Firms awareness of the importance of corporate governance remains low, however” Phan Đức Hiếu, Deputy Director of the Central Institute for Economic Management said.

Vũ Chí Dũng, Director of the State Securities Commission’s Department of International Co-operation, said that the concept of corporate governance was still new to many business leaders and oft confused with operation management.

VCCI’s Deputy Director Đoàn Duy Khương said that if Vietnamese firms wanted to close the gap with enterprises in the region, it was vital to improve corporate governance.

“Only by improving corporate governance, can Vietnamese companies shelter from economic risks and stand firmly in the market,” Vũ Tiến Lộc, Director of VCCI said.

Lộc said Việt Nam was among the top 20 economies with the highest entrepreneurial spirit but at the same time, among the 20 with the lowest corporate governance capacity. This means it is difficult to turn ideas into successful projects, Lộc said.

Trần Bá Dương, chairman of Trường Hải Auto Corporation, said that firms should not rely on economic growth to earn profits but be aware of contributing to economic growth.

Firms must clarify their strategies as well as governance principals, he said.

According to Hiếu, the judicial system of corporate governance and shareholder rights should be enhanced to improve awareness and encourage firms to develop their own principles for corporate governance.

Ownership and corporate governance should also be separated to ensure efficiency. — VNS