financial services industry has let the world down, believes the
Organisation for Economic Co-operation and Development (OECD).
Supporting its view the international body, which represents 30 of
the world’s largest economies, has launched a campaign aimed at
raising corporate governance standards and performance in an effort
to restore shattered investor confidence.
“Rebuilding investor confidence will be vital to helping the
economy get back on track,” stressed the OECD’s Secretary-General
Angel Gurría at the launch of the campaign in late September.
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At the heart of the campaign will be moves to strengthen
implementation of the OECD Principles of Corporate Governance (PCG)
launched in 1999. The principles were adopted in March 2000 as one
of the 12 core standards for sound financial systems by the
Financial Stability Forum, a body comprising major central banks,
financial industry supervisors and certain international financial
institutions.
According to the OECD its PCG are designed to help governments,
regulatory bodies and companies draw up and implement effective
systems for the governance of publicly quoted companies. The PCG
emphasise the need for companies to be accountable to investors,
advocate an effective role for shareholders in areas such as
executive compensation, and encourage increased transparency and
disclosure to counter conflicts of interest.
Strengthening the rules, regulations and codes of corporate
governance will be central to restoring investor confidence,
emphasised Gurría.
“I call on member countries to work urgently with us to address
major corporate governance failures. This will be a vital step to
reinforcing market integrity,” he concluded.
The OECD is meeting with government representatives, regulators and
private-sector stakeholders to discuss the corporate governance
lessons of the current financial crisis.
The OECD will release its findings and recommendations in late
November.
