as an orporat gov rnan s or ar vi tnam ountry r port … · the asean corporate governance...
TRANSCRIPT
ASEAN CORPORATE GOVERNANCE
SCORECARD
VIETNAM COUNTRY REPORT
5-YEAR ASSESSMENT
2012-2017
i
Foreword
The ASEAN Corporate Governance Scorecard (ACGS) assessment is one of the most important
regional initiatives of the ASEAN Capital Markets Forum (ACMF) to build a regional integrated
capital market. This initiative was kicked off in 2011 with the key objectives to raise corporate
governance standards of ASEAN public listed companies (PLCs), to bring in greater international
visibility and to promote ASEAN as an asset class.
Vietnam officially joined the ACGS initiative in 2012 with the support of the Asian Development
Bank for the assessment activities in three years of 2012-2014. From 2015, the following two
assessments of corporate governance of PLCs in Vietnam have been supported by the
International Finance Corporation and the Swiss Economic Cooperation. Since its inauguration,
ACGS 2017 project is the fifth round of corporate governance assessment. The ASEAN Corporate
Governance Scorecard was guided by the G20/OECD principles of corporate governance, ICGN
principles of corporate governance, and other globally accepted principles of corporate
governance, which emphasize the substance of corporate governance of corporations.
This report provides the review results of ACGS assessments for the 5 years and specific focus of
results of corporate governance assessment of year 2017. The report shows that Vietnamese
PLCs have improved corporate governance practices gradually over the years, with consistent
improvement efforts by the companies and other stakeholders. Nevertheless, challenges are still
apparent as the gaps of corporate governance performance between Vietnamese PLCs and their
regional peers are still very significant. Besides, the report provides detailed analyses of areas to
focus on to improve corporate governance at listed firms.
Similar to other markets, improving corporate governance of listed companies demands efforts
by various parties, the regulators, the corporations, and market participants. At national level,
strategic long-term plans and a road map of action plans should be designed by the regulators. At
company level, the role of the board of directors is crucial with an in-depth understanding about
importance of corporate governance. Good corporate governance will definitely come with
consistent leadership of corporate directors, and effective implementation of corporate
governance supporting units inside the companies, being accompanied by healthy activisms
pressures of the market. For Vietnam soon to become an active member of the ASEAN corporate
governance initiative, both these external and internal corporate governance mechanisms should
be the focus of attention.
ii
Acknowlegement
The ASEAN Corporate Governance Scorecard is one of important initiatives of the ACMF, the
regional representative body of Finance Ministers of the ASEAN Countries, that raises corporate
governance standards of ASEAN public listed companies and brands ASEAN as an attractive asset
class. This regional project can not be a success without the leadership of ASEAN Corporate
Governance Scorecard Secretariats, the Securities Commissions of Malaysia and of the
Philippines, and the important collaborative efforts of the group of domestic ranking bodies of
the six participating jurisdictions. In Vietnam, this project can not be completed without the
important leadership of Vietnam State Securities Commission (SSC).
The ACGS initiative of the ACMF began in 2011 with Vietnam joining a year later. During 2012-
2014, with the support of Asian Development Bank, assessment activities have been implemented
in continuous three years. Then in years 2015-2018, IFC has continuously supported Vietnam in
participating in the ACGS initiative beside other corporate governance improvement activities.
In Vietnam, this project has involved the participation and efforts of a group of dedicated people.
The content of this report was developed by a research team being appointed by SSC, which is led
by Dr. Nguyen Thu Hien, Ho Chi Minh City University of Technology, Vietnam National University-
Ho Chi Minh City, and her key dedicated team members, Nguyen Ngoc Hanh Nguyen and Duong
Huyen Phuong.
The Scorecard was under direct supervision and support of Vu Chi Dung, SSC, Mohd Sani Moh
Ismail, Asian Development Bank and Nguyen Nguyet Anh, IFC’s Vietnam Corporate Governance
Lead.
The overall support of this publication was provided by Sir Tran Van Dung, Chairman of SSC, Tran
Anh Dao, Vice President of Ho Chi Minh Stock Exchanges, and Chris Razook, East Asia Pacific
Corporate Governance Lead of IFC.
Particular thanks go to our direct donors including International Finance Corporation (IFC) and
Swiss Economic Coorperation (SECO) for the project being done in Vietnam continuously since
2015.
Project team and author are particularly grateful to Nguyen Nguyet Anh, Corporate Governance
Officer International Finance Corporation, IFC for her counsel, advice and her availability to bring
in timely support to this project.
iii
Table of contents
Foreword ........................................................................................................................................................ i
Acknowlegement .......................................................................................................................................... ii
Table of contents ......................................................................................................................................... iii
Abbreviations ............................................................................................................................................... vi
1 BACKGROUND OF ASEAN CORPORATE GOVERNANCE SCORECARD ............................ 1
1.1 ASEAN CORPORATE GOVERNANCE SCORECARD IN VIETNAM ........................................ 2
1.2 ASEAN CORPORATE GOVERNANCE SCORECARD 2017 METHODOLOGY .......................... 2
1.3 PEER-REVIEWING PROCESS .......................................................................................... 6
1.4 VALIDATION PROCESS .................................................................................................. 6
2 CORPORATE GOVERNANCE COUNTRY REPORT OF VIETNAM ...................................... 7
2.1 CORPORATE GOVERNANCE LEGAL FRAMEWORK .......................................................... 7
2.2 VIETNAM STOCK MARKET ............................................................................................ 8
2.3 SAMPLING METHOD .................................................................................................... 8
2.4 OVERALL ANALYSIS ...................................................................................................... 9
General assessment of Vietnam’s corporate governance performance over 5 years .................................. 9
Corporate governance of Vietnam compared to ASEAN ............................................................................ 13
Corporate governance performance in 2017 .............................................................................................. 13
Benefits of corporate governance............................................................................................................... 16
Corporate governance and market price .................................................................................................... 16
Positive impact of corporate governance on stock price ............................................................................ 17
Corporate governance and operating efficiency......................................................................................... 18
Corporate governance by sectors ............................................................................................................... 19
Corporate governance and board of directors ........................................................................................... 21
Duality and corporate governance .............................................................................................................. 21
Roles of board subcommittees ................................................................................................................... 22
Corporate governance by company scale ................................................................................................... 24
3 CORPORATE GOVERNANCE PERFORMANCE RESULTS OF 2017 ASSESSMENT ............ 25
3.1 PART A – RIGHTS OF SHAREHOLDERS ......................................................................... 25
iv
Overall results ............................................................................................................................................. 25
Organizing AGMs ......................................................................................................................................... 26
Shareholder roles and shareholders’ rights protection .............................................................................. 26
3.2 PART B – EQUITABLE TREATMENT OF SHAREHOLDERS ................................................ 28
Overall results ............................................................................................................................................. 28
Information disclosure to foreign shareholders ......................................................................................... 28
Nominations of board members and external auditors ............................................................................. 29
Conflicts of interest prevention .................................................................................................................. 29
3.3 PART C – ROLE OF STAKEHOLDERS .............................................................................. 30
Overall results ............................................................................................................................................. 30
Customers, suppliers, and creditors protection .......................................................................................... 32
Employee encouragement .......................................................................................................................... 32
Relationship with stakeholders ................................................................................................................... 33
Whistleblowing policy ................................................................................................................................. 33
3.4 PART D – DISCLOSURE AND TRANSPARENCY ............................................................... 34
Overall results ............................................................................................................................................. 34
Quality of annual reports ............................................................................................................................ 35
Company website ........................................................................................................................................ 35
Timely disclosure ......................................................................................................................................... 36
Disclosure of governance information ........................................................................................................ 37
Disclosure of related party transactions ..................................................................................................... 38
3.5 PART E – RESPONSIBILITIES OF THE BOARD ................................................................. 39
Overall results ............................................................................................................................................. 39
Board independence ................................................................................................................................... 40
Board of directors roles in overseeing strategy and risk management ...................................................... 42
Roles of supervisory board .......................................................................................................................... 42
Internal audit ............................................................................................................................................... 43
Board composition and structure ............................................................................................................... 43
Carrying out board responsibilities ............................................................................................................. 44
Code of ethics.............................................................................................................................................. 45
3.6 BONUS AND PENALTY ................................................................................................ 46
Overall results ............................................................................................................................................. 46
Bonus items ................................................................................................................................................. 47
Penalty items............................................................................................................................................... 48
v
4 CORPORATE GOVERNANCE PRACTICES AT TOP PERFORMING COMPANIES .............. 50
Overall assessment ..................................................................................................................................... 50
Opportunities for the best companies ........................................................................................................ 51
5 CONCLUSION AND RECOMMENDATIONS ................................................................. 53
Corporate governance frameworks ............................................................................................................ 54
Training for corporate directors .................................................................................................................. 55
Recommendations for corporations ........................................................................................................... 55
Recommendations for investors and stakeholders..................................................................................... 57
Conclusion ................................................................................................................................................... 58
vi
Abbreviations
ACGS ASEAN Corporate Governance Scorecard
ACMF ASEAN Capital Market Forum
AGM Annual General Meeting
AR Annual Report
ASEAN Association of South East Asian Nations
BOD Board of directors
CEO Chief Executive Officers
CG Corporate Governance
CSR Corporate social responsibilities
DRBs Domestic ranking bodies
HNX Hanoi Stock Exchange
HSX Ho Chi Minh City Stock Exchange
ICGN International Corporate Governance Network
IFC International Finance Corporation
M&A Merger and Acquisition
OECD Organisation for Economic Co-operation and Development
P/B Price to Book value of shares
PLCs Public listed companies
ROA Return on Assets
ROE Return on Equity
SECO Swiss Economic Coorperation
Tobin’s Q Price to Book value of Total assets
1
1 BACKGROUND OF ASEAN CORPORATE GOVERNANCE SCORECARD
The ASEAN Corporate Governance Scorecard (ACGS) assessment was kicked off in 2011
and it is one of the important regional initiatives of the ASEAN Capital Markets Forum
(ACMF) to build a regional integrated capital market. The objectives of this initiative are
to raise corporate governance standards of ASEAN public listed companies (PLCs), giving
greater international visibility to well-governed ASEAN PLCs, and promoting ASEAN as
an asset class.
In four years of being implemented, the ACGS has become a well-recognized tool for
measuring ASEAN corporate governance, which enhances public awareness about
corporate governance and helps international investors to have a better assessment of
the listed companies in ASEAN. The first awarding event recognizing achievements of
PLCs was the Corporate Governance Awards of the top 50 ASEAN PLCs, which was held
in Manila, Philippines, in November of 2015. This inaugural event highlighted and gave
due recognition to the significantly improved performance of the top ASEAN PLCs which
proactively adopted internationally recognized best practices.
After four years of assessment, domestic ranking bodies of each participating country,
including Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam, have
reviewed the methodology and scorecard criteria to reflect new market developments
and new updates of the G20/OECD principles of corporate governance. In 2017 the
assessment process and methodology were revisited to enhance its independence and
reliability.
In 2017, participating countries have implemented the assessment of corporate
governance with the support of the domestic ranking bodies (DRBs) of respective
countries as follows:
• Indonesian Institute for Corporate Directorship;
• Minority Shareholder Watchdog Group, Malaysia;
• Institute of Corporate Directors, Philippines;
• Singapore Institute of Directors and the Centre for Governance, Institutions and
Organisations of the National University of Singapore Business School; and
• Thai Institute of Directors.
2
• A group of corporate governance experts, led by Dr. Nguyen Thu Hien (consultant
of IFC), from HCM University of Technology, Vietnam National University – HCMC
under the supports of International Finance Corporation (IFC) and Swiss
Economic Coorperation (SECO).
1.1 ASEAN CORPORATE GOVERNANCE SCORECARD IN VIETNAM
The ACGS initiative of the ACMF began in 2011 with Vietnam joining a year later in 2012.
During 2012-2014, with the support of Asian Development Bank, assessment activities
have been implemented in continuous three years. In years 2015-2018, IFC has
continuously supported Vietnam in participating in the ACGS initiative beside other
corporate governance improvement activities.
Improving corporate governance of listed companies demands efforts from various
parties, the regulators, the market parcitipants, and the corporations. To improve
corporate governance of listed companies in Vietnam, strategic long-term plans and
action plans should be set up from the top. At company level, the role of the board of
directors is crucial. Besides, improving disclosure and transparency could be a quick and
effective action to improve repulation and image of the corporations.
1.2 ASEAN CORPORATE GOVERNANCE SCORECARD 2017 METHODOLOGY
ASEAN Corporate governance assessment methodology is built to evaluate corporate
governance of listed companies based on publicly available information such as company
websites, annual reports, corporate governance reports, sustainability reports, articles of
association, investor announcements and notices, AGM documents, AGM minutes and
resolutions, corporate news on company websites, stock exchanges and securities
commission websites, news and media, etc.
Before assessment, international corporate governance standards and regulatory
developments of each participating countries were reviewed and embedded in the
scorecard assessment criteria. The development of the scorecard was guided by the
following principles:
• The scorecard should reflect global principles and internationally recognized
good practices in corporate governance applicable to PLCs and, in some instances,
may exceed the requirements and standards in national legislations.
3
• The scorecard should not be based on the lowest common denominator, but
should aim to encourage PLCs to adopt higher standards and aspirations.
• The scorecard should be comprehensive in coverage, capturing the salient
elements of corporate governance.
• The scorecard should enable gaps in corporate governance practices among
ASEAN PLCs to be identified and should draw attention to good corporate
governance practices.
• The scorecard should be universal and applicable to different markets in ASEAN.
• The methodology should be robust to allow the accurate assessment of the
corporate governance of PLCs beyond minimum compliance and box ticking.
• There should be extensive and robust quality assurance processes to ensure the
independence and reliability of the assessment.
Revision of ACGS 2017 scorecard
ACGS 2017 Scorecard is a result of revision process to reflect the updates of G20/OECD
principles of corporate governance, ICGN principles of corporate governance, and other
globally accepted principles of corporate governance. The revision is also to enhance the
effectiveness of the scorecard in reflecting the substance of corporate governance of
firms.
The scorecard has two levels, Level 1 and Level 2. The use of two levels of scoring is
designed to better capture the implementation of the substance of good corporate
governance. Level 1 comprises descriptors or items that are in essence indicative of (1)
the laws, rules, regulations, and requirements of each ASEAN member; and (2) basic
expectations of the G20/OECD principles. Level 2 consists of (i) bonus items reflecting
other emerging good practices, and (ii) penalty items reflecting actions and events that
are indicative of poor governance.
The questions in Level 1 and 2 have 5 parts, reflecting five G20/OECD principles of
corporate governance, there are: (1) Right of shareholders, (2) Equitable treatment of
shareholders, (3) Role of stakeholders, (4) Transparency and disclosure, (5) Role and
responsibilities of board of directors.
One significant change of the questions at level 1 is the change of the weightages of
principle Role of stakeholders from 10% to 15%, and principle Equitable treatment of
4
shareholders from 15% to 10%. This change reflects the increasing importance of the
roles of stakeholders in corporate governance, including stakeholders’ roles in
sustainable development, expected actions for environmental development, productive
relationship with employees, suppliers, customers, communities, etc.
Besides, it is important to ensure the reliability and validity of the ACGS. To measure the
substance and salient elements of corporate governance, the criteria in the scorecard that
reflect simple in-form practices have been eliminated, and the weightages of important
corporate governance practices have been increased. Some important criteria in Level 1
has been allocated weightages. The maximum score of Level 1 is 100 points.
The significant areas of corporate governance that have been emphasized are
composition and structure of board of directors, independence of board of directors,
independence of the Chairman, independence of the inspection committee/audit
committee of the board, presence and independence of other committees of the board of
directors, transparency of board decision in nominating new directors, role of board of
directors in strategic planning, monitoring the implementation of the strategy,
monitoring risk management, dispatching roles and responsibilities of the board of
directors, remuneration structure of board of directors and key executives. Besides, other
areas are also emphasized, such as practices in organizing AGM, AGM notice and
information disclosure of resolution/minutes; code of conduct/ethics, corruption
prevention, whistle blowing policies and whistle blower protection policy; policies
encouraging stakeholders in improving corporate governance, policies protecting
benefits of stakeholders, roles of firms to the environment for a sustainable development.
Structure and content of ACGS
ACGS has two-level structure. Details of ACGS are presented in Table 1. Total score of
Level 1 is the maximum achievable score of all parts in Level 1. Score of each part is
calculated by score of the part divided by the total maximum achievable score of the part
and multiplied by the weightage of the part.
Questions in Level 2 include Bonus and Penalty criteria for outstanding practices and
violation/poor practices that should be prevented. ACGS 2017 has 13 bonus and 25
penalty questions. Combining with Level 2, total achievable score a firm can have will
include score of Level 1 (a maximum of 100 points) plus a maximum of 30 bonus points
5
and minus a maximum of 67 penalty points if the firm practices outstanding corporate
governance activities or violates in significant areas of Level 2.
Therefore, the best-performing firm, which does the best in both Level 1 and Level 2
bonus areas and does not get deduction for any penalty for poor practices at Level 2 will
get total maximum score of 130 points, which is composed of 100 points of Level 1 and
30 bonus points of Level 2.
Table 1. Structure of ACGS scorecard – Level 1 and Level 2
Components of ACGS Number of questions
Maximum score in each area
Components of Level 1
Part A – Rights of shareholders 21 10
Part B – Equitable treatment of shareholders 15 10
Part C – Roles of stakeholders 13 15
Part D – Disclosure and transparency 32 25
Part E – Roles and responsibilities of the board 65 40
LEVEL 1 SCORE
100
Components of Level 2
Bonus area 13 30
Penalty area 25 -67
LEVEL 2 SCORE 30
TOTAL SCORE (Level 1 + Level 2) 130
The weightages of respective areas in Level 1 are: 10 points for Part A- Right of
shareholders, 10 points for Part B- Equitable treatment of shareholders, 15 points for
Part C- Role of stakeholders, 25 points for Part D- Transparency and disclosure, and 40
points for Part E- Role and responsibilities of board of directors.
Level 2 includes bonus and penalty questions, including bonus questions with +1 to +4
points, and penalty questions with -1 to -5 points.
6
The ACGS has adjusted the maximum achievable scores in each of the four years to reflect
the respective developments of corporate governance practices in the region and in the
world. Therefore, the maximum score in each year are distinguished and presented in
Figure 1. The total maximum score of 2017 is 130 points.
1.3 PEER-REVIEWING PROCESS
Peer review is another distinguished characteristic of the ASEAN corporate governance
scorecard compared with other scorecard methodologies. Specifically, similar to
previous years, in 2017 the assessment includes two rounds: Round 1 – Internal process,
DRBs1 of each of the six countries, called original reviewer, will implement local
assessment on its local firms; then, in Round 2 – Peer review process, the other DRBs,
called peer reviewers, will implement independent assessment on the country’s local
firms. The local and peer-reviewed results will be checked and reconciled to arrive at the
finalized and agreed assessment results.
In 2017, the top 35 companies in each country will be selected to go through the peer-
review process. The peer reviewers are assigned randomly to ensure that all firms in each
country will be peer reviewed by DRBs of all other countries. This process is a mechanism
to lever corporate governance evaluation of DRBs, a good example of a process of
integrating individual national markets into one single ASEAN market.
Following the peer review process, DRBs will discuss and clear gaps of evaluations.
Systematic mis-evaluations if any must be fixed and adjusted for the local scores of all
local firms, including those (35) companies that have not been peer reviewed.
1.4 VALIDATION PROCESS
This is a new process being implemented in 2017 with an objective to validate the public
information disclosed by companies. This validation process is applied for the candidates
of the top 70 ASEAN companies. An independent company is nominated to implement the
validation process by interviewing key corporate leaders and executives, including board
members and CEOs, corporate secretaries about corporate governance practices.
1 Please refer to page 1 for the list of DRBs of the six participating countries.
7
Based on the CG scores assessed from the two rounds, internal and cross-checking
rounds, 70 PLCs with the highest CG scores in ASEAN will be selected and included in the
verification process. The verification review process was conducted from May to June
2018. From the 70 verified enterprises, the best 50 PLCs was voted as the best managed
PLCs in ASEAN.
2 CORPORATE GOVERNANCE COUNTRY REPORT OF VIETNAM
2.1 CORPORATE GOVERNANCE LEGAL FRAMEWORK
After more than three years of implementation, Circular No. 52/2012/TT-BTC guiding
information disclosure on securities market and Circular No. 121/2012/TT-BTC on
corporate governance system applicable to public companies were thoroughly revised by
the Government and the State Securities Commission and replaced by new regulations.
Circular No. 155/2015/TT-BTC guiding information disclosure on securities market and
Decree No. 71/2017/ND-CP and Circular 95/2017 / TT-BTC on corporate governance
guidelines for public companies have been issued to further improve the legal framework
for disclosure of information and enhance stock market transparency to meet advanced
requirements of market development and global integration. One highlight of the new
Circular No. 155/2015/TT-BTC, replacing Circular No. 52/2012/TT-BTC since January
1st 2016, is the recommendation for listed companies’ information disclosure in both
Vietnamese and English so that foreign investors could gain more access to the
information. Circular 121/2012/TT-BTC is still valid until August 1st 2017. Since its
issuance, it has helped to overcome many limitations of previous regulations, established
a stricter regulatory framework for the stock market, and helped to improve corporate
governance compliance of Vietnamese listed companies.
In addition, the legislation system for corporate governance has been strengthened since
the application of the Law on the Handling of Administrative Violations in 2012. Then,
the issuance of Decree 108/2013/ND-CP on administrative penalties for violations in
securities and securities market has increased market supervision and enhanced market
transparency. This Decree regulates sanctions in securities and securities market with a
number of specific monitoring measures for corporate governance violations, reporting
and disclosure, transactions of shareholders and insiders, and other violations.
8
2.2 VIETNAM STOCK MARKET
Vietnam stock market officially came into operation in 2000, and after more than 15 years
of establishment and development, it has gained many achievements and significant
growth in terms of both market capitalization and transaction volume. As of December
31st 2016, there were 319 companies listed on the Ho Chi Minh Stock Exchange and 374
companies listed on the Hanoi Stock Exchange. In addition, 391 companies registered to
trade on Unlisted Public Company Market (UPCom), and 745 public companies not yet
registered to be listed. Beside the increase in the number of listed or registered
companies, market capitalization has grown considerably. According to statistics
provided by States Securities Commission, Vietnam stock market capitalization reached
almost VND 3.360 trillion, equivalent to 74.6% of GDP, as of December 31st, 2017.
However, this scale is still modest compared to other ASEAN countries. Data shows that
in 2016, the stock market capitalization to GDP of Thailand, Singapore, Malaysia, and the
Philippines were 104%, 227%, 135%, and 85%, respectively. Stock market is a capital
market operating on the principle of free and open competition, through which the
capital will be attracted to safe and efficient investment opportunities. Businesses with
good performance, and more importantly, good corporate governance system, would be
ideal destinations for domestic and foreign investments. Good governance is not only a
prerequisite condition, but also a priority to attract capital successfully and sustainably,
making the stock market a substantial source of capital for Vietnam economy.
2.3 SAMPLING METHOD
The ASEAN Corporate Governance Scorecard is based on the point of views of
international investors, so publications in English are used as the main source of
assessment information. Accordingly, companies having largest market capitalization at
the end of April 2017 listed on Ho Chi Minh City Stock Exchange (HSX) and Hanoi Stock
Exchange (HNX), with shareholder documents in English are included in the evaluation
list. The minimum requirement is the availability of annual report in English.
With the above sampling method, the sample is qualified to represent the respective
capital markets of jurisdictions. In 2017, there were 70 Vietnamese listed companies
being included in the assessment. Compared with the figure in 2015 with 55 companies
evaluated, this is a significant improvement in the use of English for shareholder
9
documents. The market capitalization of these 70 companies in 2017 accounts for 71%
of the total market capitalization of the two stock exchanges. As a result, similar to
previous years, the 2017 sample size can represent the stock market in Vietnam.
The sample includes 80% of Vietnamese PLCs in the VN-30 index at the end of 2017.
There are 6 companies in VN-30 not included in the samples because their investor
documents are not available in English. The sample includes 5 listed companies on the
HNX and 65 on the HSX.
2.4 OVERALL ANALYSIS
Since the scorecard is based on ASEAN corporate governance standards, each
jurisdiction’s regulations are prerequisite but not the sufficient conditions for a good
performance under ASEAN standards. Vietnam’s compliance rate to the standards is still
low, compared with other countries in the region, and the gap is quite large in each
assessment area.
General assessment of Vietnam’s corporate governance performance over 5 years
There have been remarkable improvements in corporate governance scores achieved by
listed companies in 2017 compared to those of previous years in most components.
The total achievable maximum scores have changed in each assessment year and are
shown in Graph 1. The total maximum score of year 2017, comprised of CG score of Level
1 and Level 2, is 130 points.
10
Graph 1. Vietnam corporate governance scores over 5 years of assessment 2012-2017
Graph 1 shows that corporate governance scores in every area have improved
throughout the last five years. The average corporate governance score increased by
12.3% in the latest assessment (from 36.8 points to 41.3 points). The standard with the
highest increase was Part A – Rights of Shareholders (by 30.3%), followed by Part E –
Responsibilities of the Board (by 14%), and Part D – Transparency and Disclosure (by
10.12%).
There is a change in Part B and C’s weightages, whereby Part B now weights 10% and
Part C’s weightage increases to 15%. The 2017 assessment results show that Part B -
Equitable Treatment of Shareholders has improved, but Part C – Role of Stakeholders has
not seen much change. Changes in scores of these two components (decline in Part B and
increase in Part C) are mainly due to their weightage change.
11
Despite improvements in each area and in the overall corporate governance scores have
been seen, this result is still modest. Vietnamese PLCs have not reached the high ASEAN
standards. The average score of 41.3 is far from the maximum attainable score of 130.
Corporate governance performance improvements of companies being assessed
throughout 5 years
Good corporate governance requires continuous and consistent improvements in both
internal and external governance mechanisms of any business to meet the expectation of
investors and the market. Therefore, the market expects a sustainable improvement over
the years in corporate governance of companies that have been present in all
assessments of the ASEAN Scorecard throughout 5 years. The results show that 26
companies present in all years’ assessment list have achieved significant corporate
governance improvements throughout the period. In 2017, the average corporate
governance score of these companies increased 19.4% from the previous year (from 40.6
to 48.7) and 13% per year over the last 5 years.
Although corporate governance scores of these 26 companies have improved
significantly, this has not helped to increase the overall performance of Vietnam as many
new companies were added for the sample of 2017 assessment. These new companies
have limited information disclosure to shareholders. This significantly affects the overall
results in 2017.
12
Graph 2. Corporate governance scores of the companies being assessed throughout 5 years
2012-2017
13
Corporate governance of Vietnam compared to ASEAN
Graph 3. Average scores of ASEAN countries
The assessment of corporate governance performance of ASEAN countries over the years
have shown a significant and continuous improvement in regional markets, and Vietnam
is not an exception. Graph 3 shows that Vietnam corporate governance score reached its
highest level in 2017 but it is still far away from its neighbors’ performance. Specifically,
the average score of Vietnamese PLCs is 41.3 in 2017, which is a big gap compared to that
of Indonesia of 70.6, of Philippines of 67.6, and of the highest-scored country of Thailand
of 85.7.
Corporate governance performance in 2017
The assessment results of 70 Vietnamese listed companies in 2017 reveal that a big gap
in corporate governance scores exists between the best and the worst companies as
shown in Table 2.
14
Table 2. Vietnam corporate governance score in 2017
The Level 1 maximum achievable score is 100, and the highest score in Level 1 is
72.12/100. The company with the lowest score in Level 1 reached 23.42/100. Level 1
score indicates compliance level to ASEAN corporate governance standards. Level 1
median score is 42.3/100, showing that more than 50% of the companies have not
satisfied basic ASEAN standards on corporate governance.
The maximum achievable score of Level 2 is 30 for the case of no penalty points being
deducted and all bonus points being fully earned. However, Vietnamese companies have
not well applied advanced corporate governance practices yet. The company with the
highest Level 2 score earned 4/30 points. The lowest Level 2 score is -7/30. The median
score of Level 2 is -2 points. This result shows that more than 50% of the evaluated firms
violated some key areas and got penalty scores.
The overall results show that the best Vietnamese company at Level 1 achieved a good
Level 1 score (72.12/100) but did
not earn any bonus point in Level 2.
This implies that even performance
of the best Vietnamese companies is
still far from the best in the region
due to the lack of advanced corporate
governance practices in Level 2, or
due to corporate governance
violations in Level 2 key areas.
Part A Max=10
Part B Max=10
Part C Max=15
Part D Max=25
Part E Max=40
Level 1
Max=100
Level 2
Max=30
Total CG score
Max=130
Average 6.37 6.84 5.90 12.94 10.98 43.04 -1.74 41.30
Min 4.62 5.79 0.00 4.38 4.80 23.42 -7.00 20.18
Max 10.00 8.95 14.06 21.25 24.53 72.12 4.00 73.11
Median 6.00 6.75 6.09 12.81 9.73 42.30 -2.00 38.74
The best performing company at Level 1
achieved a good Level 1 score (72.12/ 100) but
did not earn any bonus point in Level 2. This
implies that performance of the best
Vietnamese companies is still far from the best
in the region due to the lack of advanced
corporate governance practices in Level 2, or
due to corporate governance violations in Level
2 key areas.
15
Graph 4. Corporate governance score by components in 2017
As shown in Graph 4, there is a large gap between the best and the worst companies in
corporate governance performance. The best company achieved a total score of 73.11
compared with the 20.18 points of the worst. Firms in the median only scored 38.74,
indicating that half of the firms were in the low scoring group (below 38.74).
Nevertheless, the best Vietnam’s PLC only achieved 56% of the maximum attainable
score. In particular, the best company scored 73.11 compared to the maximum score of
130 points. This fact indicates that a great
deal of efforts of the market, and the
companies, especially companies with
relatively high corporate governance
standards, is needed to improve the
governance of Vietnamese PLCs.
A great deal of efforts of the market, and the
companies, especially companies with
relatively higher standards of corporate
governance practices, is needed to improve
the governance of Vietnamese PLCs.
16
Benefits of corporate governance
Many international prestigious surveys and researches have pointed out clear benefits of
corporate governance for companies, especially in terms of market value, including
capitalization value of shareholders and the company. In particular, companies with good
corporate governance often enjoy higher valuation than ones with poorer governance
system. Stock prices of companies with good corporate governance are also more stable
and less vulnerable to stock market volatility.
Corporate governance and market price
Analysis of 2017 results indicates that companies in top corporate governance scores are
also the ones having the highest P/B ratios (Price to Book value of shares). Particularly,
the best group had P/B of 2.33 while the group with the lowest corporate governance
score obtains a P/B ratio of 1.79. P/B is the ratio between market price and book value of
a stock. Similarly, the Tobin's Q ratio (the ratio of market value to book value of total
assets) of the group with the highest corporate governance scores was also higher than
the bottom group (1.13 versus 0.92). This difference is statistically significant.
Graph 5. Corporate governance score and market price
17
Positive impact of corporate governance on stock price
Stock price can be determined by many factors, e.g. market growth, operating efficiency,
profitability, debt ratios, firm size, industry characteristics, etc. Therefore, a regression
analysis of all five years of corporate governance score under the ASEAN Scorecard
assessment from 2012 to 2017 was conducted.
The regression results, after reviewing and controlling all factors that may affect stock
prices (profitability, debt ratios, firm size, industry characteristics) and market growth
over the years, has shown a clear result that
corporate governance scores have positive
impacts on stock prices. This effect is
statistically significant. Specifically, the
impact factor of corporate governance score
on P/B ratio is positive, expressed by the
upper slope of the regression line in Graph
6.
Graph 6. Correlation between corporate governance score and P/B
This analysis indicates that companies with higher corporate governance scores will gain
confidence and trust from investors and they are willing to pay higher prices for their
shares as well as to hold the stocks for long term and even when market conditions are
less favorable.
-2
-1
0
1
2
3
4
5
6
0 10 20 30 40 50 60 70 80
P/B
ratio
CG Score
CG score and P/B ratio
The regression results, after reviewing and
controlling all factors that may affect stock
prices (profitability, debt ratios, firm size,
industry characteristics) and market
growth over the years, has shown a clear
result that corporate governance scores
have positive impact on stock prices.
18
A similar analysis between the corporate governance score and the Tobin Q ratio showed
that higher corporate governance scores also boost the company's market value and
Tobin Q, including both share and loan
values. This implies that improving
corporate governance also facilitates
access to loans, which increases the
potential to raise capital for long-term
sustainability.
Corporate governance and operating efficiency
The analysis indicates that stocks with good corporate governance yield higher returns
than those with poor corporate governance. Specifically, ROA of the companies with high
corporate governance scores ranged from 1% to 32%; while those of the group with the
lowest corporate governance score ranged from 0% to 26%.
Likewise, the group with the highest corporate governance score also had the highest
ROE, ranging from 3% to 51%; while ROE of lowest corporate governance score group
ranged from 1% to 37%.
Table 3. Corporate governance score and operating efficiency
Top corporate governance scores (20 PLCs)
Middle corporate
governance scores (30
PLCs)
Bottom corporate
governance scores (20
PLCs)
ROA
Average 8.6% 8.3% 8.6%
Max 31.9% 24.2% 26.2%
Min 0.6% 0.2% 0.4%
Median 8.1% 5.4% 7.5%
ROE
Average 18.3% 15.5% 16.5%
Max 50.6% 37.6% 37.2%
Min 2.7% 1.0% 0.5%
Median 14.2% 13.0% 16.9%
International studies and surveys have also indicated that while good corporate
governance allows companies to control risk and mitigate uncertainties that affect the
The analysis also shows that improving
corporate governance also facilitates access
to loans, which increases the potential to
raise capital for long-term sustainability.
19
achievement of long-term growth objectives, it may not necessarily bring direct financial
results to the business. However, it can help businesses to stay productive and achieve
sustainable growth.
Consistent with other international studies, the analysis suggests that there is no
significant difference in the mean of ROA and ROE amongst firms with good corporate
governance and poor corporate governance. However, the key benefits arising from
improved corporate governance are more stable profitability and sustainable growth.
Graph 7. Corporate governance score and operating efficiency
Corporate governance by sectors
This analysis evaluates corporate governance performance by sector. As shown in Table
4, 70 companies in 2017 assessment list are classified into 10 sectors, with the number
of companies in each sector not evenly distributed. Most of them are from consumer
goods, finance, and industries fields. There is only one company in the
telecommunications industry.
20
Table 4. Corporate governance score by sectors
Sector Number of companies
Level 1 Score
Level 2 Score
Total corporate
governance score
Consumer Goods 20 39.83 (2.40) 37.43
Consumer Services 3 41.23 (3.67) 37.56
Energy 4 37.38 (4.25) 33.13
Financials 13 47.43 0.85 48.28
Bank 5 45.21 2.40 47.61
Non – bank 8 48.82 (0.13) 48.69
Healthcare 3 56.53 0.00 56.53
Industries 11 43.06 (1.27) 41.79
Materials 2 43.57 (2.00) 41.57
Property 10 41.89 (3.30) 38.59
Telecommunications 1 63.89 0.00 63.89
Utilities 3 37.65 (2.00) 35.65
Evaluating corporate governance by sector should take into account the number of
companies in each sector. In terms of scores, the telecommunications industry has the
highest average score (but only 1 company in this sector), followed by Healthcare (3
companies). The third highest score is from Finance, which is the largest sector (13
companies), including banks, insurance, and securities companies. These 3 sectors
generally use communication channels (websites, reports) with comprehensive
necessary information and appear to have a positive attitude towards public information
disclosure.
Banking sector is required to comply with stricter regulations, such as the Law on Credit
Institutions and standards for capital and risk management in accordance with Basel II.
Thus, the banking is also the group that has higher corporate governance scores than the
non-banking groups.
21
Table 5. Corporate governance performance of bank versus non – bank companies in 2017
Level 1 score Level 2 score Total score
Bank (05) 45.21 2.40 47.61
Non – bank (65) 42.87 (2.06) 40.81
Graph 8. Corporate governance score by sectors in 2017
Corporate governance and board of directors
The characteristics expected for the board of directors, the highest representative body
of a firm responsible for developing and overseeing the operation of corporate
governance system, are strategic vision, integrity, professionalism, competencies, and
independent role. An independent director would help the board to achieve a high level
of leadership and operational supervision. A board with dedicated subcommittees
responsible for key issues of governance can enhance its responsibility in the role of
business leaders.
Duality and corporate governance
Decree 71/2017/ND-CP stipulates the separation of Chairman and CEO positions in all
listed companies. Accordingly, by August 1st 2020, Vietnamese PLCs are no longer
allowed to have duality situation where Chairman is also CEO. In the year 2017, there
22
were many companies changing their governance structure to separate these two
positions. As a result, the number of duality cases fell to 20% from 30% in the previous
year. Analysis of corporate governance results between the two groups, with and without
duality, shows that companies without duality have higher corporate governance scores
than those having such structure.
Table 6. Corporate governance score and dual Chairman/ CEO structure
2013 2014 2015 2017
Duality 35.72 32.58 34.39 39.75
Non – duality 33.17 36.04 37.64 41.65
As illustrated in Table 6, all years’ assessment results, except for the year of 2013, show
that companies without duality
status have achieved better
corporate governance performance.
This is an interesting finding and has
practical implication.
Roles of board subcommittees
The results indicate that companies with subcommittees have better corporate
governance practices. Subcommittees in the assessment include the nomination and
remuneration subcommittee. The role of board subcommittees has become increasingly
important, as demonstrated by the
widening gap between corporate
governance scores over the years between
the two groups. Groups with board
subcommittees scored higher than those
without. While in 2013, the average score of
companies with subcommittees is higher by
2.55 points (35.78 versus 33.23), by 2017
the difference was 13.38 (50.28 versus
36.90).
The assessment results over the years show that
companies without duality status have achieved
better corporate governance performance.
The results indicate that companies with
subcommittees have better corporate
governance practices. The role of board
subcommittees has become increasingly
important, as demonstrated by the
widening gap between corporate
governance scores over the years between
the two groups.
23
Graph 9. Role of board subcommittees in corporate governance score
An encouraging fact is that more and more companies have established board
subcommittees, which is a good conformity to international practices on corporate
governance. In 2013, there were only 10 companies that have either nomination or
remuneration committee. But in 2017, the figure is 23 companies. Amongst 70 companies
evaluated in 2017, 47 companies did not have subcommittees. These subcommittees are
defined as nomination committee and remuneration committee.
Table 7. Companies and board subcommittees
2013 2014 2015 2017
Having board subcommittees
Corporate governance score 35.78 37.31 42.58 50.28
Number of companies 10 14 16 23
Not having board subcommittees
Corporate governance score 33.23 34.29 34.36 36.90
Number of companies 30 36 39 47
Having audit committees is compulsory under Vietnamese law, so it was not counted as
the other board committees as shown in Graph 9 and Table 7. In the traditional corporate
24
governance structure of Vietnam, roles and functions of audit committee is within the
scope of duties and responsibilities of supervisory board. However, since the
introduction of the Law on Enterprises in 2014, a new model has been proposed whereby
supervisory board can be replaced by board level audit committee.
Corporate governance by company scale
International researches and studies point out that large companies tend to have better
corporate governance practices than smaller ones. Some explanations are that larger
companies having more non-executive board members are more likely to set up
subcommittees and implement many good corporate governance practices.
The result of 2017 ASEAN scorecard assessment also reveals similar results. Larger
companies score higher than medium and small ones. A point worth noting is that smaller
companies have more violations and get more penalty points in Level 2 than large
companies do. In particular, penalty score is often due to failure to meet the requirements
of independent board members.
Graph 10. Corporate governance score by scale
25
3 CORPORATE GOVERNANCE PERFORMANCE RESULTS OF 2017 ASSESSMENT
3.1 PART A – RIGHTS OF SHAREHOLDERS
Overall results
As owners of a company, shareholders contribute capital in terms of shares and have
certain basic ownership rights such as right to obtain timely and relevant information, to
vote on material corporate changes, to share in corporation profits, beside other rights
as prescribed by law.
Table 8. Results of Part A – Rights of Shareholders
Part A Part B Part C Part D Part E
Average 6.37 6.84 5.90 12.94 10.98
Min 4.62 5.79 0.00 4.38 4.80
Max 10.00 8.95 14.06 21.25 24.53
Median 6.00 6.75 6.09 12.81 9.73
As shown in Figure 1, average corporate governance score of Vietnam PLCs has increased
by 12.3% this year (from 36.8 points in 2015 to 41.3 points in 2017). Part A – Rights of
shareholders – has witnessed the highest growth amongst all components, 30.3% rise,
and reached the average of 6.37 out of 10. The best company in the component achieved
10 points, and the lowest score was 4.62.
Significant improvements in this area are remarkable progress in pre-AGM preparation,
procedures and organization of shareholder meetings, voting procedures in AGM, and
disclosure of AGM resolutions. Moreover, PLCs become more aware of the importance of
disclosing information on shareholders engagement activities and detailed company
profile to attract investment capital and boost the business reputation amongst investor
community.
However, there is a need for further improvement in quality of AGM Notice and
documents to meet ASEAN standards and to release of AGM Minute and company’s
constitution in English. Timely dividend payment is one of the important shareholder
requirements that businesses need to pay attention to. ASEAN standards require cash
26
dividends to be paid within 30 days after being announced or approved by AGM, and
stock dividends to be paid within 60 days.
Organizing AGMs
According to G20/OECD corporate governance principles and Vietnam corporate
governance framework, shareholders’ access to sufficient and timely information on
relevant and material company information, including one concerning AGM, must be
facilitated and encouraged. Vietnamese PLCs have made good progress in publishing
AGM announcement and documents. The results show that in 2017, 32% of companies
(compared to 9% in 2015) have sent out notice for all AGMs and EGMs at least 21 days
before the meeting, and 43% (compared to 24% in 2015) meet ASEAN standards for
content quality of AGM documents. For further improvement, AGM documents need to be
more specific and include helpful details and explanation for items that require
shareholders’ approval at the meeting.
However, the majority of Vietnam PLCs did not appoint an independent party to validate
the votes at AGM, a good practice widely applied in other ASEAN countries. Only 12% of
PLCs (compared to 2% in 2015) have adopted this practice by having external auditor or
minority shareholder to take part in or oversee the vote counting process at the meeting.
Shareholder roles and shareholders’ rights protection
It is more evident that public companies now have devoted extra efforts into encouraging
shareholder engagement by promoting effective two – way interaction. One highlight is
27
the preparation for AGM to facilitate shareholders’ participation and their votes on
material matters. However, there is a need of AGM Minute to be publicly disclosed, since
part of shareholders, especially foreign investors, may not attend the meeting, to ensure
their equal rights be protected. Because of the low rate of disclosure of AGM Minute,
Vietnamese PLCs usually lose points in items relating to attendance details of board of
directors and top executives and the effectiveness of the meeting, including record of
questions raised by shareholders and corresponding answers. Particularly, only 29% can
show evidence from AGM Minute that shareholders have opportunity to ask questions to
the board and management team although this practice is quite popular in Vietnam.
One of the important shareholders’ rights is to share company profits and receive
dividends on time. Similar to previous years, the percentage of companies that ensure
dividend payment within 30 days after announcement or approval at AGM still remains
low, only 11.43%. This is a crucial point that Vietnamese PLCs need to pay more attention
to as it has direct impact on shareholders’ rights.
Information on independent party involved in M&A or takeover transaction evaluation
requiring shareholders’ approval still remains limited. Amongst 10% of companies which
had M&A transactions or transactions entailing substantial portions of corporate assets,
none appointed an independent party to evaluate the fairness of transaction price.
STRENGTHS
▪ The majority of basic shareholders’ rights are respected.
▪ Policies and activities to promote two – way interaction between companies and shareholders, especially institutional shareholders, are well implemented.
AREAS FOR IMPROVEMENT
▪ AGM Notice is not provided at least 21 days before AGMs or EGMs.
▪ AGM documents lack detailed information and explanation for agenda items requiring shareholders’ approval.
▪ Both English and Vietnamese versions of AGM Minute are not publicly available or their contents are not complete.
▪ The majority of Vietnam PLCs did not appoint an independent party to validate the votes at AGM.
▪ Dividend payments are not made within 30 days after announcement or approval at AGM.
▪ There is no appointment of independent party to evaluate the fairness of M&A transactions or it is not disclosed properly.
28
3.2 PART B – EQUITABLE TREATMENT OF SHAREHOLDERS
Overall results
Different groups of shareholders should be treated equally. Therefore, company needs to
ensure that all shareholders of the same class must own the same rights, obligations, and
interests. Where the company has different classes of shares, the rights and obligations
attached to each class of shares should be explicitly disclosed to all shareholders and be
approved by AGM. In fact, most Vietnamese companies have only one type of common
stock and each share has one vote. This guarantees the right to equal treatment for all
shareholders in accordance with good corporate governance practices.
Table 9. Part B – Equitable Treatment of Shareholders
Part A Part B Part C Part D Part E
Average 6.37 6.84 5.90 12.94 10.98
Min 4.62 5.79 0.00 4.38 4.80
Max 10.00 8.95 14.06 21.25 24.53
Median 6.00 6.75 6.09 12.81 9.73
In 2017 scorecard, the weightage of Part B reduces to 10%, which is a factor that explains
for no change in its score although this part has improved considerably. Particularly, this
part has an average score of 6.84/ 10 points. Company with the highest score gained 8.95
points, the lowest score was 5.79 points.
Information disclosure to foreign shareholders
An aspect that not yet received adequate attention from PLCs is the equal treatment
towards foreign shareholders. The percentage of companies disclosing investor
documents in English is very low. In 2017, only 70 companies have annual reports in
English. Compared to more than 700 companies currently listed on both stock exchanges,
this figure is very low while these companies are expecting to attract abundant capital
from foreign investors. In addition to publishing annual report, there are still many
limitations in providing AGM meeting documents in English, such as late release of the
English version with poor contents, lack of detailed information, and information
sometimes not consistent with the Vietnamese version. This may hinder foreign investors
from getting accurate, timely and sufficient information about AGM.
29
Nominations of board members and external auditors
Nominating and selecting board members is one of the important decisions of
shareholders, requiring shareholder's knowledge of the candidates. However, nearly
12% of the companies provided sufficient profiles of
board candidates in AGM documents that meet ASEAN
disclosure standards, a very low rate compared with the
peer countries. 50% of companies did not provide
complete details information of the nominated
candidates, and 38.6% of companies did not have any
election of members of the Board of Directors in the year.
An encouraging fact is the increasing number of
companies providing the list of candidates of independent audit firms to be approved at
AGM (nearly 26% of companies in 2017, compared with 22% in 2015).
Conflicts of interest prevention
In good corporate governance practices, benefits of the company and shareholders as a
whole should be first priorities, rather than the interests of one or some groups of
insiders or major shareholders. Vietnamese corporate law and legal documents on
corporate governance also have strict regulations to prevent conflict of interests. For
example, regulations that require board of directors, supervisory board, CEO and other
executives to be honest, to avoid conflicts of interest, and to prohibit insider transactions
or similar transactions that bring material and non-material benefits to these members.
However, in comparison with the ASEAN standard for conflicts of interest prevention, a
minor but not less important point that is missing in the Vietnamese law is a regulation
to require directors to abstain from attending board meeting and voting on the matter
that they have conflict of interests.
In addition, there is a lack of evidence showing companies’ commitment to protect
minority shareholders from conflicts of interest caused by transactions with related
parties. To be specific, more than 97% of Vietnamese PLCs do not have a statement in
annual report confirming that all related party transactions are conducted fairly and
based on arm’s length basis.
30
STRENGHTS ▪ Each resolution only deals with one item.
▪ AGM document provides list of audit firms seeking appointment.
AREAS FOR IMPROVEMENT
▪ English version of AGM documents is not fully disclosed or not released on the same date with the Vietnamese version.
▪ AGM documents usually lack profile of directors seeking election.
▪ Companies do not have policy requiring directors to abstain from attending board meeting on the matter that they have conflict of interests.
▪ Statement confirming the fairness and transparency of related party transactions is hardly found.
3.3 PART C – ROLE OF STAKEHOLDERS
Overall results
Beside shareholders’ interests, corporate governance principles also strive to protect
interests of stakeholders, such as employees, customers, suppliers, creditors,
environment, and local community, to ensure the sustainable development of both
companies and community. Part C is to examine companies’ commitment to stakeholders’
interests as well as to sustainable development when determine company policies and
strategies.
In 2017 ASEAN Corporate Governance Scorecard, Part C – Role of Stakeholders, has
weightage increased to 15%. The average component score in the 2017 assessment is 5.9
out of 15. The best company earned 14.06 points while the lowest score is zero.
Requirements of this part are more advanced than the ones in previous scorecard
versions, whereby companies have to develop coherent policies and concrete actions to
protect rights of stakeholders, and these policies and corresponding programmes also
need to follow ASEAN standards.
31
Table 10. Part C – Role of Stakeholder
Part A Part B Part C Part D Part E
Average 6.37 6.84 5.90 12.94 10.98
Min 4.62 5.79 0.00 4.38 4.80
Max 10.00 8.95 14.06 21.25 24.53
Median 6.00 6.75 6.09 12.81 9.73
From the five – year results of the ASEAN Corporate Governance Scorecard, a significant
change is noted in companies’ awareness of their responsibilities towards society and
community. Most of the companies, up to 81% in this year's review, have their own
section on social responsibility. Some companies even publish their own sustainability
report following the international GRI standard, which addresses the role of stakeholders
as well as positive business efforts towards welfare of employees, customers,
environment, and local community.
Thanks to the wider application of international reporting standards on these aspects,
contents relating to consumer protection, environmental protection, and community
contribution policies and their implementation are fully disclosed in a specific manner.
This improvement suggests that Vietnamese PLCs now become more aware of the role
and importance of stakeholders in their sustainable development strategy.
Areas for improvement are the full disclosure of company policies in supplier selection
towards sustainable development standards as well as
practices in place for effective implementation. In addition,
policies and action programs to protect creditors should be
clearer and more specific. Policies to strenghthen employees’
commitment by designing staff’s compensation policy based on
company long – term performance also need more attention
from company leaders.
Whistleblowing policy as well as policy to protect whistleblowers are new concepts to
Vietnamese companies. However, this is one of the important internal and external
governance mechanisms that need to be developed. An effective implementation of this
32
whistleblowing mechanism will not only allow early detection of governance violations,
but also a deterrent mechanism to prevent potential violations.
Customers, suppliers, and creditors protection
There are more than 61% of companies having disclosed policies and activities to protect
customers’ welfare in their annual reports or sustainability reports, including policies on
product quality, customers’ health and safety, together with capital refund policy. This
number has significantly improved compared to previous years.
However, the company should pay more attention and develop coherent policies aiming
at the role and interests of stakeholders, such as suppliers and creditors, to ensure
sustainable development goals. For instance, beside usual economic factors, the supplier
selection process and criteria need to include factors relating to environmental
protection, ethics, and social responsibility of suppliers as a key element of sustainable
value chain.
Creditors' policies and procedures are rarely mentioned in annual reports. Only 3
companies has mentioned it in their Code of Ethics. Loan contracts are often strictly
protected by law through terms of loan agreements. But, in terms of good corporate
governance policies and procedures, the company should have a general pledge in this
respect, showing their commitment to protect important stakeholders’ rights, a crucial
part of a holistic corporate governance framework.
Employee encouragement
Results show that 86% of companies has disclosed full policies and practices on staff’s
welfare, health, and occupational safety. Statistics on
training programs and staff development programs of 71%
of companies are also fully provided in annual report.
However, quite a few (31%) of PLCs focus on developing
reward policies to associate staff with company
performance in the long – term, such as employee stock
ownership plan or application of balance scorecard in
measuring staff performance.
33
Relationship with stakeholders
Company website usually has separate section for investor relations, but communication
channels for stakeholders, especially when they want to voice possible violations of their
rights, are rarely observed. According to 2017 assessment results, nearly 83% of the
companies do not provide contact details of specific person or department in charge of
addressing stakeholders’ rights.
Whistleblowing policy
One apparent weakness is that whistleblowing policy and as well as policy to protect
whistleblowers from retaliation are still new to Vietnamese PLCs. Only one firm has
developed policy and procedures that allow its employees to report illegal or unethical
behaviors directly to a department or person in charge; and also only one firm has policy
and procedure in place to protect employees who report wrongdoings.
STRENGTHS • Companies pay attention to policy and practices to ensure customers’ welfare, health, and safety.
• Companies implemented good policies and activities to protect environment and contribute to welfares of communities.
• Companies provide separate section or report on CSR or sustainability issues.
• Information on staff’s health, safety, and welfare is described in annual report.
• Statistics on staff’s training programs and activities are clearly disclosed.
AREAS FOR IMPROVEMENT
• Supplier selection procedures and creditor protection policy are not well established and disclosed.
• Staff’s compensation policy based on company long – term performance is not well disclosed or implemented.
• Whistleblowing policy and procedures are not in place; Contact details of whistleblowing hotline is not yet provided; Policy to protect whistleblowers is not disclosed and/ or implemented.
• Companies do not provide contact details of specific person or department that stakeholders can use to voice possible violations of their rights.
34
3.4 PART D – DISCLOSURE AND TRANSPARENCY
Overall results
It is important for a company to ensure that all material and relevant information is
disclosed in a timely, accurate, accessible, and reliable manner to all shareholders and
other stakeholders. Company information consists of two types, compulsory disclosure
and voluntary disclosure. Regulations on compulsory disclosure have been specified in
legal documents guiding information disclosure on securities market and monitored
closely by regulatory authorities. In addition to satisfying disclosure requirements
prescribed by law, some companies voluntarily provide information to meet market
demand, showing a higher level of transparency and disclosure.
Table 3. Part D – Disclosure and Transparency
Part A Part B Part C Part D Part E
Average 6.37 6.84 5.90 12.94 10.98
Min 4.62 5.79 0.00 4.38 4.80
Max 10.00 8.95 14.06 21.25 24.53
Median 6.00 6.75 6.09 12.81 9.73
As can be seen from five – year analysis of corporate governance scores, there is an
apparent improvement in corporate governance performance of Vietnamese PLCs,
including scores in Part D – Transparency and Disclosure. This component has 10.12%
increase and reached 12.94/ 25 points in 2017. The highest score was 21.25, the lowest
score was 4.38. The application of Circular 155/2015/TT-BTC with more stringent
regulations on information disclosure, especially recommendation regarding disclosure
in English, is very helpful in improving quality of information disclosure for foreign
investors.
Major improved is information on ownership structure of large shareholders, internal
shareholders, corporate structures with shareholding interests; information on
remuneration for board members and details of their meeting attendance; company
financial and non-financial information.
35
However, there are many aspects that need to be improved in order to meet the ASEAN
requirements, the indirect ownership of major shareholders and internal shareholders in
particular. Directorships of board members are not fully disclosed as required by ASEAN
standards. This important piece of information helps shareholders not only to evaluate
board members’ commitment but also to identify potential conflicts of interest that might
affect their benefits. Audit and non–audit fees also need to be disclosed so that
independence level of audit firms can be assessed. Improving English version of company
website is one of important requirements as it allows foreign investors to gain access to
material company information, such as company charter, AGM documents, AGM
resolutions, AGM minutes, and other necessary information for their decision making
process.
Quality of annual reports
Transparent information disclosure of a company must ensure quality of its annual
report. More and more companies have now focused on the quality of this report by
including all basic information, such as corporate objectives, financial and non–financial
indicators, total remuneration of each director, as well as their meeting attendance
details. Likewise, identity of major shareholders and detailed corporate structure are
fairly well disclosed. However, similar to 2015 results, many companies failed to provide
details on dividend policy, audit and non–audit fee, and directorships of board members.
Company website
The company website is an effective communication means for both domestic and foreign
investors to quickly get access to important company news. All companies in this year’s
assessment list have websites with all necessary information for shareholders in
Vietnamese language. However, there are still 7% of companies not having an English
version of their websites, or this version has errors and is inaccessible, or selected
language is English but only Vietnamese contents are available. This would hinder foreign
investors from gaining access to company information. The results show that nearly 50%
of companies perform well in providing financial statements of the current and prior
years. 34% of companies have published their company charters in English. In some
cases, its title is in English but the file path goes to the Vietnamese version instead or the
attached file is not available. Due to failure to publish the English version of company
charter as well as corporate governance internal regulations, more than two thirds of
36
Vietnamese listed companies lost points in the 2017 assessment. The publication of these
documents is simple but it shows the company's commitment to good corporate
governance practices.
A number of websites have a specific section for investor relations, which provides
detailed information and reports, such as financial reports, regulatory documents, and
AGM information, including invitation, meeting documents with proposals and
explanations, minutes and resolutions. Nevertheless, the number of companies with IR
section with a complete necessary information is still low, usually due to the lack of AGM
documents and minutes in English.
Many websites have not provided contact information of department responsible for
investor relations, a helpful channel for shareholders to reach when they have questions
or need supports. Only 41% of companies could fulfill this requirement.
Vietnamese PLCs still have limited use of different communication channels, such as
analyst’s briefings or press conferences (only 17% of companies). Company websites do
not publish articles or analysts’ report on company performance (only 27% provided
these helpful documents).
Timely disclosure
Timely disclosure of financial statements and annual reports is crucial, but the fact
remains that many companies failed to release both reports within 120 days from the
financial year end or the date of publication is unknown. The non–compliance rates for
financial statements and annual reports are 41% and 61%, respectively.
37
Disclosure of governance information
There are only a few annual reports having company statement on its compliance with
corporate governance regulations or explanations for non–compliance cases. Although
G20/OECD good corporate governance practices encourage disclosure of shareholdings
by board of directors, supervisory board, and top executives, a majority of companies still
do not provide this information in annual report, especially their indirect shareholdings.
Only 79% satisfied the disclosure requirement for board members’ ownership and only
59-66% fulfilled the requirement of disclosing ownership information of management
board and major shareholders. One positive fact is that more than 67% of companies
reported details of internal shareholder transactions during the year.
38
Disclosure of related party transactions
Disclosure of related party transactions in accordance with the ASEAN standards
requires details on company policy regarding the process of assessment, review, and
approval of material related party transactions. However, only 11% of companies could
satisfy this requirement. Information on related party transactions is not fully disclosed.
In particlar, 23% of PLCs do not meet this information disclosure requirement, including
stating name, relationship, nature, and value for each related party transaction.
STRENGTHS
▪ List of major shareholders and corporate structure with names and shareholding interest is included in annual report or company website.
▪ Annual report provides basic company information, such as corporate objectives, financial and non–financial performance indicators, total remuneration of individual directors, as well as board meeting attendance details.
▪ There is a separate section of Investor Relations in English, which has annual reports and financial statements of current and previous years, on company website.
▪ Trading of inside shareholders is fully disclosed.
AREAS FOR IMPROVEMENT
▪ There is a lack of statement affirming company’s compliance with corporate governance regulations.
▪ Details of shareholdings of board of directors, supervisory board, and board of management are not disclosed by ASEAN standards; Information on directorship of board members is not available.
▪ The audit and non–audit fees are not disclosed.
▪ Audited financial statement and annual report in English are usually released later than 120 first days of the following fiscal year or publication date is unknown.
▪ Company website lacks financial reports, company charter, AGM documents, AGM notice, AGM resolutions, and AGM minutes in English.
▪ Companies provide limited number of communication channels, such as analyst’s briefings or press conferences.
39
3.5 PART E – RESPONSIBILITIES OF THE BOARD
Overall results
Board of directors has a central role in setting up corporate governance framework,
overseeing corporate strategy implementation, monitoring risk management system,
supervising executive bodies, and ensuring shareholders’ benefits. An independent,
professional, and efficient board of directors will help to increase the quality and
effectiveness of the corporate governance system and better shareholder value in the
long–run. Part E of ASEAN Corporate Governance Scorecard has shown certain
improvements of Vietnamese PLCs in 2017 although the overall results are still modest.
Table 12. Part E – Responsibilities of the Board
Part A Part B Part C Part D Part E
Average 6.37 6.84 5.90 12.94 10.98
Min 4.62 5.79 0.00 4.38 4.80
Max 10.00 8.95 14.06 21.25 24.53
Median 6.00 6.75 6.09 12.81 9.73
The analysis of achieved corporate governance scores in each component throughout five
years has shown some improvements in corporate governance performance according to
ASEAN standards. The average corporate governance score has increased by 12.3%
compared to the closest assessment year (from 36.75 points to 41.3 points). Part E on
board responsibilities has the second biggest increase, up to 14%, and reached 10.98 over
40 points on average. The highest achieved score is 24.53 points while the lowest is 4.8
points.
A marked improvement in Part E is the separation of supervisory and execution roles in
governance structure. Many companies have followed this practice by splitting CEO and
Chairman positions. The fact that board of directors has better fulfilled their role in
identifying and evaluating existing and potential risks along with proposing effective risk
management measures is also an improved aspect in 2017.
Although it has the second biggest increase, part E, the component that carries the biggest
weightage and has dominant impact upon corporate governance performance of
40
companies, only has a modest average of 10.98 or 27.45% of the maximum score of the
field. Areas for improvement include the increase of number and percentage of
independent board of directors members to introduce diverse perspectives and better
board of directors discussion quality, and the increase of independent monitoring role to
prevent any potential conflict of interests that may harm shareholders’ benefits.
Establishing board subcommittees to carry out key roles of board of directors, especially
subcommittees in charge of nomination, renumeration, and risk management, still
remains a challenge to Vietnamese PLCs. Roles of supervisory board and their
independence in monitoring and preventing corporate accounting and financial risks
need to be addressed as well. Also, governance structure of most Vietnamese companies
has not included internal audit function yet. Good governance principles require that
internal audit function or department to report directly to the board of directors/audit
committee of the board of directors and its head to be appointed and dismissed by the
board of directors or Supervisory board.
Board independence
As for board independence, there is more than 81% (compared to 70% in 2015) of
companies having separate roles of CEO and Chairman. This indicates that companies
have been preparing for the new Decree 71/2017/ND-CP, which strictly requires the
separation of these two leadership positions.
Although only 7% of the Chairmen are independent, this proportion is a significant
improvement from previous year results (3.6% in 2015). The appointment of a Lead
independent director in case the Chairman is not independent is still an unfamiliar
practice to Vietnam, and none of Vietnamese companies has adopted this good practice.
A Lead independent director is expected to have a powerful voice, representing opinions
and perspectives of other independent members at board meetings, especially when a
board voting is required. He also helps to reduce risks and potential conflict of interests
when the Chairman is not independent.
41
The results show that there are still many limitations in meeting governance standards
that requires a proportion of independent directors and term limits of board members.
ASEAN standards require independent members to make up at least 50% of board of
directors, higher than Vietnam standard of 1/3, only 2 companies could meet this
standard. None of the companies in 2015 could satisfy the ratio of 50%. Given Vietnam's
statutory standards requiring at least one-third of the Board members to be independent,
by the end of 2016 only nearly 14% of all PLCs on the HSX met this requirement,
according to a research at Ho Chi Minh City University of Technology.
In addition, the regional good corporate governance practice does not advocate current
board of directors member to be former CEO in the past 2 years to avoid potential
conflicts that may negatively affect the leadership of the new term. There are 13% of
companies not meeting this standard.
In order to ensure the effective commitment to responsibilities, ASEAN laws and
standards have set a limit of five board seats that an independent director can hold
simultaneously. This is also a rule in Vietnam law to enforce roles and responsibilities of
the independent board members. However, only one company reported its compliance
with the regulation. No relevant information is provided by the other companies.
Vietnamese PLCs are doing well in limiting the number of board seats outside the group
held by their executive directors. Nearly 66% of listed companies have at least one non-
executive director with prior working experience in the company's core business.
42
Board of directors roles in overseeing strategy and risk management
Board of Directors plays a primary role in guiding corporate strategy. International
investors expect board of directors to effectively dispatch their roles in practice.
However, figures show that only 1/3 of companies have stated and described the process
of board of directors to review and monitor the strategy implementation in the latest
year’s annual report.
The 2017 assessment results reveal that companies have high compliance level in basic
requirements, such as statement on updated company vision and mission in annual
report or company website, and helpful and detailed information on key risks that the
company is facing and corresponding risk management measures in annual report.
Roles of supervisory board
According to ASEAN standards, the independence of the Board of Supervisors or Audit
Committee is a crucial factor to ensure their objectivity when performing their role of
checking the legitimacy and prudence level in business operation; evaluating the
integrity, consistency, and suitability of accounting works, including doing statistics and
financial reporting; and assessing the effectiveness and efficiency of internal control
system, internal audit function, and risk management system. Therefore, independence
status of Supervisory board members should be clearly disclosed. ASEAN standards
require all Supervisory members to be non – executive directors, and the majority of
them must be independent. In 2017 sample, the practice
was adopted by 9% of companies. Moreover, it also
requires Head of Supervisory board to be independent. 4
over 70 companies could meet this standard. Another
good corporate governance practice is Supervisory board
having at least one independent member with accounting
expertise.
Furthermore, many Vietnamese PLCs have failed to show the crucial role of Supervisory
board and Board of directors as well as their activities towards the company internal
control or risk oversight by reviewing material controls, and commenting on the
adequacy of the system. Part of their responsibilities is to ensure that the effective risk
management system is in place, especially a system for financial and operational controls,
which needs to comply with the law and relevant standards. However, it shall be noted
43
that the compliance rate in this particular item is currently 27%, remarkably improved
compared to previous years’ results. This indicates a growing interest amongst
Vietnamese business community in risk oversight and management. The authorities of
Supervisory board over the appointment and removal of external auditor have not been
publicly disclosed yet. This information is usually in company charter but the English
version of this document is hardly found.
Although the 2014 Law on Enterprises allows public companies to have Audit committee
instead of Supervisory board, there is only one company having adopted the new model
till end of May 2017, when the 2017 scorecard assessment was carried out. Despite it is
stated in the Law, no sub–law document has detailed guidance for its roles,
responsibilities, as well as criteria in selecting Audit committee members, has made it
well described and explained to be applied in reality while this is a common practice in
many countries that have one–tier board corporate system.
Internal audit
The number of PLCs having internal audit function has increased; however, this is still
not a common practice in Vietnam. ASEAN standards also
require disclosure of information on the head of internal audit
along with details about Supervisory board or Audit
committee’s authorities over the appointment and removal of
internal auditor. 36% of companies has this department in
their organization chart, but only one mentioned that the
appointment and dismissal of internal auditor require the
approval of Supervisory board.
Board composition and structure
Selection criteria and procedure for appointment of new directors, as well as criteria and
process for annual appraisal of board of directors, board of directors members, and board
of directors subcommittees do need more attention from Vietnamese PLCs.
The policy encouraging board members to participate in training programmes has a
marked improvement compared to previous years outcome even though the compliance
rate is still lower than other countries in the region.
There is a growing awareness of the importance and necessity of board subcommittees,
though the establishment of subcommittees is not yet common in Vietnam. The figure
44
shows that only 20-30% of companies have subcommittees handling nomination and
renumeration matters. There are many cases that the established subcommittees do not
meet the requirement of independence.
Carrying out board responsibilities
This year result shows that Vietnamese companies have done well in terms of ensuring
the number of board meetings during the year as well as the full participation of board
members in meetings.
However, there is little evidence that companies have scheduled board meetings before
the start of a new fiscal year as well as held at least one meeting amongst non-executive
members without any executives present. Even regulation on minimum quorum at board
meetings is hardly found because the English version of company charter is not publicly
available. Disclosure of Supervisory board members’ meeting attendance details still
needs improvement.
Likewise, compensation structure for board members and the CEO has not been fully
disclosed. Shareholders are concerned about both remuneration structure and policy,
including KPIs, of CEO and board members. The compliance rates for disclosing fee
structure of non – executive directors and remuneration policy for CEO and executive
directors are 16% and 6%, respectively.
45
In a standard corporate governance system, corporate secretary plays a very important
role in assisting the board to access information quickly and in a timely manner, and to
fulfill their duties and responsibilities. However, the role of company secretary in
Vietnam is still not observable and only 2 companies provided evidence that the company
secretary has attended legal, accounting or professional training.
Code of ethics
Vietnamese PLCs should pay more attention to the drafting and disclosure of the code of
ethics as this is a good international practice widely recognized by foreign investors.
Currently, only 7 companies have published English version of the Code on company
website. The Code of Ethics should be applied to all directors, executives, and staff.
STRENGHTS • Chairman and CEO positions are separated.
• The board has at least one non–executive directors having working experience in company’s major area.
• There is no executive director serving more than two boards outside the group.
• The company has adequate number of board meetings during the year and full participation of their board members.
• The company discloses the list of key risks and corresponding risk management measures.
• Updated vision and mission are clearly stated in annual report.
AREAS FOR IMPROVEMENT
• The percentage of independent directors remains lower than 50% and there is a lack of two–term limit requirement for independent directors.
• Many companies have not established board subcommittees on nomination and remuneration.
46
• Selection criteria and appointment procedure for new board members are not disclosed.
• There is little evidence showing board of directors has conducted a review of material controls and risk management system during the year.
• There is a lack of statement from board of directors or Supervisory board on the adequacy of existing internal control and risk oversight system.
• Code of ethics with full details is hardly found.
• Detailed compensation policy for board of directors members and CEO is not disclosed.
• Board meetings are not scheduled before the start of new fiscal year.
• Non–executive members do not have separate meeting without any executives present.
• Disclosure of Supervisory board members’ meeting attendance details needs improvement.
• There is lack of disclosure of assessment criteria and process for annual appraisal of board of directors, board of directors members, and board of directors subcommittees.
• The authorities of Supervisory board over the appointment and removal of external auditor have not been publicly disclosed yet.
3.6 BONUS AND PENALTY
Overall results
Level 2 includes bonus and penalty items. Rewards are to encourage exceptionally good
corporate governance practices above requirements of the ASEAN Corporate Governance
Scorecard Level 1. Likewise, penalties are to detect and limit poor corporate governance
practices.
Table 43. Bonus and Penalty.
Part
A
Part
B
Part C
Part
D
Part E
Level 1
score
Level 2 score
Total corporate governanc
e score
Average 6.37 6.84 5.90 12.94 10.98 43.04 -1.74 41.30
Min 4.62 5.79 0.00 4.38 4.80 23.42 -7.00 20.18
47
On Bonus and Penalty part, Vietnamese PLCs get an average score of -1.74 points
compared to the highest attainable score of Level 2 of 30 points. This suggests that
companies were penalized more than what they earned as reward points. This is also the
main reason why Vietnam corporate governance score stays lower than that of their peer
ASEAN countries. Vietnamese companies have good scores at Level 1, the best one
reached 72.12 over 100 points, while the highest score in Level 2 is only 4. The maximum
overall corporate governance score is relatively low at 73.11 over 130 points due mainly
to poor performance on Level 2.
Bonus items
In 2017, nearly 15% of companies have established separate board level Risk committee,
showing the board's growing concern for risk management. It shows that the board is
more committed to enhancing the quality of corporate risk management. Similarly, few
companies are rewarded for having policies and process of information technology (IT)
governance. Having an increasingly crucial role in every industry, policy and process
around IT issues do need the board’s attention. All risks associated with IT systems, cyber
security, and disaster recovery should be identified, processed, and reported to the
board.
Developing policy on board diversity is what companies should study if they want to be
attractive to foreign investors. Gender diversity and variety of expertise would help to
give the board a multiperspective viewpoints in board decisions. The assessment result
shows that the number of companies with at least one female independent directors
reduced slightly in 2017.
As for board independence, there is one company earned reward points as its
independent members make up more than 50% of the board of directors.
Moreover, sustainability reports following Global Reporting Initiative (GRI) reporting
framework, especially G4 Guidelines, were released by 30% of companies. This is a
remarkable improvement compared to previous years, indicating a change in the
Max 10.00 8.95 14.06 21.25 24.53 72.12 4.00 73.11
Median 6.00 6.75 6.09 12.81 9.73 42.30 -2.00 38.74
48
Vietnamese business community’s perception of social responsibility and sustainable
development.
Furthermore, a small number of companies have gained bonus scores by adopting good
corporate governance practices such as disclosing full AGM documents at least 28 days
prior to the meeting date, releasing their audited financial report within 60 days from the
financial year end, and disclosing details of CEO’s.
Penalty items
Even though scores earned in bonus part are higher than
previous years, Level 2 total score is still the lowest in 5 years
of assessment due to high penalty. A substantial percentage of
companies, 37%, lost point as they failed to identify
independent board members. Some companies received
penalty points despite having full list of independent directors
because their date of first appointment is not disclosed. The
date of first appointment is an important piece of information
to evaluate independence status of these directors. It is generally believed that their
independent role cannot be fulfilled if they have served the company for more than two
terms.
In addition, since the Chairman has been the company CEO in the last three years, 24% of
companies had to face penalties. Several companies also violated new penalty item that
independent directors receive performance shares or company bonuses (3/70
companies).
Nearly 63% of companies received penalty points due to lack of evidence showing the
attendance of Chairman, CEO, and Head of Supervisory board. The main reason is AGM
minutes or AGM resolutions do not provide board attendance details or are not available
in English. Likewise, companies need to make early announcement of any additional AGM
or EGM agenda item in order not to have penalty scores.
In terms of related party transactions, there is 7% of companies committing violations
by providing financial support in the form of loans to entities other than wholly–owned
companies. Regarding ownership structure, 7% of companies have pyramid ownership
structure or cross holding structure. These types of ownership structure allow some
shareholders to gain a degree of control over the company disproportionate to the
49
shareholders’ equity ownership in the corporation. This practice is not recommended by
international corporate governance standards.
In order to avoid penalty, the company should disclose special shareholders agreement
that enables certain shareholders to possess a degree of control disproportionate to their
publicly disclosed equity ownership. Companies will also be penalized if there is any
violation of law on issues related to workers, consumers, government, or commerce and
competition.
STRENGTHS • A separate board level Risk committee is set up in several companies.
• Many companies have followed GRI G4 guideline when drafting their sustainability reports.
• There is at least one female independent director in the board.
AREAS FOR IMPROVEMENT
• Independence status of board members are not clearly identified.
• The date of first appointment of independent board members is not disclosed.
• Chairman has been the company CEO in the last three years.
• Independent board member is holding more than five directorships in companies outside the group.
• Independent board members receive performance shares or bonuses.
• Company has offered financial assistance to entities other than wholly–owned subsidiary companies.
• Pyramid ownership structure and cross holding structure still exist in several companies.
• Company fails to disclose special shareholders agreement.
• There is a lack of evidence that Chairman, CEO, and Head of Supervisory board fully attended the most recent AGM.
50
4 CORPORATE GOVERNANCE PRACTICES AT TOP PERFORMING COMPANIES
Overall assessment
The analysis of the top companies shows that there are large gaps of scores between the
Top 3 and Top 10 groups of firms and the all-firm sample throughout the five assessment
years 2012-2017. Specifically, scores of Top 3 companies and Top 10 companies are 40.4
and 36.7 points, respectively, higher than those of all-firm sample in 2012 – the first year
of assessment. However, the gaps are larger in 2017, which are 71.3 and 61.9 points,
respectively, compared to the average score of the all-firm sample of 41.3 points. This
shows that, for listed companies that care about corporate governance, their efforts have
resulted in good outcomes, which help these firms to improve its reputation and equity
value in the past years. However, on a broader view, for the whole market, it is much
more challenging for regulators to improve the whole market to help upgrading the
country ranking.
Figure 10 – Corporate governance score of best-performing companies over the years.
SSC and the stock exchanges have made a lot of efforts to make VN stock exchange to be
upgraded from frontier to emerging market in June 2019. According to Morgan Stanley
Capital International (MSCI), in principle VN market is qualified to be upgraded, however,
51
it still lacks of factors for sustainable development. Currently, Vietnam has not met
various criteria, especially qualitative criteria, to be upgraded.
Beside quantitative criteria, such as market capitalization, liquidity, capital transfer,
foreign investor ownership, MSCI also requires various criteria of governance, such as:
shareholder right protection, equitable treatment of shareholders, disclosure and
transparency, information available in English for foreign investors, etc. Therefore,
improving corporate governance is a significant step for VN stock market to be upgraded.
Working toward a market upgrade by improving corporate governance of the best
performing companies, which are also the largest market-capitalization companies in the
market, could be a wise strategy.
As shown in Figure 10, the Top 3 and Top 10 companies have improved governance
scores over the years. Top 3 group increases more than 76% since the first assessment
year, and more than 22% since the last assessment year. The group of top 10 companies
increased by 68% compared to the first year of evaluation, and increased by 20%
compared to the preceding year. These results are very encouraging for the top-
performing companies. Improving corporate governance at these top companies not only
helps levering the activies of the whole market, but also helps these companies to appear
on the Top ASEAN list, and helps Vietnam to enhance its visibility in the global capital
market.
Opportunities for the best companies
Detailed scores analysis in Figure 11 shows that Top 3 and Top 10 groups perform well
at Level 1. They achieved almost the highest scores in Part A and B. Part D and E need
more attention. While improving criteria in Part D requires more transparency and better
disclosure of information about governance, business activities, stakeholders activities,
improvements in Part E require the most efforts.
52
Figure 11. Detailed scores of best-performing companies
Besides, though the Top 3 and Top 10 do fairly at Level 1 criteria, they do not perform
well at Level 2 criteria. Scores at level 1 are fair, which are 68.7/100 and 59.9/100 for
Top 3 and Top 10, respectively. Scores at Level 2 are very humble, which are 2.7/30 and
2/30 for Top 3 and Top 10, respectively.
To improve the governance, the best-performing companies should focus on areas of
roles and responsibilities of the board of directors. Specifically:
There should be active mechanism to prevent conflict of interests: without exceptions,
firms should require board of directors to abstain from the meetings, discussing and
voting on related party transactions that they have related benefits.
There should be not only policies but also implemented practices to encourage
stakeholders to cooperate in improving corporate governance. The stakeholders should
have access to relevant, sufficient and reliable information on a timely and regular basis.
More attention should be paid into building an effective whistle blower policy that allows
stakeholders to be able to freely communicate their concerns about illegal or unethical
practices to the board and their rights should not be compromised for doing this.
The independence of auditors should be ensured: while providing both audit and non-
audit services, the auditing firms should ensure that benefits from non-audit services
should not be greater than that from audit service, information of fees paid to auditing
firms should be transparently disclosed.
Information about how board of directors have dispatched their roles and
responsibilities should be provided: board of directors are expected to actively lead the
53
firms, including leading and monitoring strategy implementation, dispatching key roles
in controlling and monitoring risks.
Code of conduct/ethics should be set up which requires all company’s employees to
comply with. Mechanism to monitor and enforce the code of conduct/ethics should be
clearly specified.
Increasing the presence of independent directors in the board is still a challenge for the
best-performance companies though, in meeting the regional standards of 50%
independent directors and term limit of independent board members, to ensure the
independent monitoring role of the board of directors.
Roles of the board in nominating new directors, setting remuneration of the board and
key executives is crucial for company’s sustainable development. The independence of
the nomination, remuneration committees with a majority of committee members being
independent is highly recommended by ASEAN standards.
Currently the independent roles of inspection committee/audit committee have not been
well regulated by Vietnam’s laws. This is however crucially important in ASEAN regional
standards: Chair of inspection committee/audit committee must be independent, all
members of inspection committee/audit committee must be non-executive with a
majority of the members being independent. Companies are encouraged to have internal
audit unit with the head of the unit being nominated and removed by inspection
committee/audit committee.
More attention should be paid to training and orientation activities for new and current
directors. Information on training and orientation activities should be publicly disclosed
with specific plans and programs. Board evaluation and assessment with transparent
processes should be clearly disclosed.
5 CONCLUSION AND RECOMMENDATIONS
Vietnam has recently issued new regulations for enhancing corporate governance, which
is an important initiative to improve corporate governance in Vietnam, enhancing
transparency and visibility of the ASEAN market to international investors. However, to
be able to catch up with the regional developments, efforts from the regulators in
monitoring and enforcing corporate governance regulations, and together with active
market actions are highly credited. In this overall corporate governance improvement
54
landscape, ACGS is among the effective tools that allow monitoring, evaluating and
yielding inputs to build road maps for improving corporate governance in each
participating countries, including Vietnam, in the recent years.
ACGS 2017 shows that Vietnam has recorded some encouraging improvements in English
disclosure, with more companies providing AR in English, more detailed information is
provided in investor documents, information is disclosed more promptly. Other CG
improvement areas have been identified. Firms have implemented more active
interaction with shareholders, especially institutional investors; better prepration for
AGMs with earlier announcement, more information provided in AGM resolutions; better
sustainable development reporting. Efforts in improving independence of the board of
directors have been recognized. More firms have nominated independent Chairmen, and
separated the roles of Chairmen and CEOs, etc.
However, beside the mentioned improvements, the gap between corporate governance
practices of Vietnam and other regional countries is still significant and remains a
challenge, which could be quickly cleared only with more efforts from regulators and
market activisms. The findings from ACGS 2017 have identified rooms for improvement.
5.1. RECOMMENDATIONS TO GOVERNMENT AGENCIES
Corporate governance frameworks
Enhancing corporate governance institutional framework with regulations is highly
expected for a developing market. Depending on the development of each country,
regulatory framework and environmental corporate governance mechanisms should be
formed appropriately.
In jurisdictions where corporate governance development is poor, improvement of
corporate governance requires regulated frameworks by two measures, (1) minimum
regulatory requirements, and (2) more advanced corporate governance standards. The
minimum regulatory requirements should be well established in regulations with
compulsory mandates. If not complied, strict enforcement mechanisms will follow. In
fact, observations from ACGS has shown that the level of regulated areas are higher in
countries like Indonesia, Philippines and Vietnam than in more developed markets.
Beside mandated regulations, the more advanced standards should be promulgated with
comply or explain basis, which are not mandated but encouraged for firms to comply
55
with, otherwise they must explain. Normally these advanced standards are introduced in
national codes of corporate governance. Codes of corporate governance will be soon
introduced in Vietnam to encourage and help firms to identify, and be prepared to apply
more advanced corporate governance standards and practices.
Training for corporate directors
To effectively enhance awareness and understanding of corporate governance, training
activities for corporate directors need to be in place. Training programs should be
provided for not only corporate directors, inspection committee/audit committee
members but also for corporate secretaries, investor relation officers, internal auditors,
etc.
Besides, seminar/conference activities for shareholders, especially minority
shareholders, about corporate governance, about their roles as market activists in
enhancing corporate governance of firms should be organized.
Recently, with the incorporation of Vietnam Institute Of Director (VIOD,) an independent
organization, which promotes corporate governance standards and best practices in the
Vietnamese private sector, and support the professional development of directors, with
a focus on improving the effectiveness of their boards and board committees, it is
expected that Vietnam will soon have a pool of professional corporate directors who are
well equipped with good expertise and knowledge about CG, roles and responsibilities of
directors and ready to take initiatives in improving CG of Vietnam corporations.
Recommendations for corporations
The corporate governance assessment of 2017 has shown that corporations have spent
more efforts in improving corporate governance by applying ASEAN CG standards.
Improvements have been seen in various areas of corporate governance. However, more
efforts are expected. The following part will summarize general expected actions from
corporations.
It is expected that the board of directors should take the leadership in the project to
improve corporate governance of the firm. Besides, to put corporate governance policy
into actions requires a collaborative effort of various units in companies including but
not limited to corporate secretaries, investor relation unit, information disclosure unit,
internal audit unit, etc.
56
Organizing AGMs
It is observed that AGMs procedures have been improved, however, firms should
announce the AGMs earlier with all AGM documents, resolutions being provided with
comprehensive details and explanations for shareholders to make good decisions for
their benefits. Companies should improve disclosure in English to ensure information
symmetry and simultaneous disclosure of English and Vietnamese documents to ensure
equitable treatment between foreign and local investors. Counting of votes during AGMs
should be observed by independent parties.
Board director nomination
Procedure to nominate and select directors of the board should be transparent with
disclosed criteria. Director nomination criteria should specify expected director
characteristics, including expertise, experiences and backgrounds, that are needed for
company’s strategic development, for company’s good governance structure and control,
and for the diversity of leadership of the board. Profiles of nominated directors that seek
shareholders’ approval should be informative, which show expertise, experiences,
backgrounds, current commitments with other companies, and the independent status at
the company that he/she is seeking directorship.
Conflict of interest prevention
There should be articles specified in company charter or corporate governance policy,
committing that company transaction with related parties are fair, and transparent.
There should be procedures for board voting process for related parties transactions that
require the member with related benefits to abstain from discussion and voting process.
Company website
Most companies assessed have websites in English with separate sections for investor
relation or corporate governance. However, improvements are expected to make
company charters and corporate governance principles available in English.
Profit sharing
Companies should pay dividends to shareholders promptly. Dividende policy should be
disclosed with appropriate explanations such as policies, rationales, forms, and amount
of dividends. Shareholdings of large shareholders, inside shareholders should be
57
disclosed with both direct and indirect shares owned by each identified shareholders of
the mentioned groups. Information about directorship of board members in other
countries, especially in public listed companies, should be transparently disclosed to help
shareholders to identify potential conflicts if any.
Independence of auditing firm, internal audit, audit committee
The independent role of auditing firm is crucial for shareholders. The expected
information to be disclosed is the fees of audit and non-audit services, with expectation
that the fees of the audit services not to be less that other non-audit services provided for
the firms. Internal audit units should have an independent status, and be nominated by
inspection committee/audit committee. Roles and independence of inspection
committee/audit committee should be enhanced. Companies should consider applying
new governance structure in which an independent audit committee at the board should
be established, following the new LOE recommendation.
Recommendations for investors and stakeholders
Improving corporate governance demands for efforts of not only the companies, but also
the investors, and all market stakeholders, market forces which will raise the bar, and
demand firms to identify their governance issues and to act appropriately to improve
corporate governance.
Roles of investors
Shareholders, especially minority shareholders, hold shares but have diffculties in
capturing information and exercising their roles as shareholders in controlling the
companies. Therefore, shareholders should be aware about the importance of corporate
governance, and utilize channels and mechanisms to request for the board and key
executives to improve corporate governance. Companies should have an active investor
relation unit, which protects the rights of shareholders, acts on shareholders’ concerns.
The investor relation unit should not merely comply with the law but also present the
utmost attitude towards protecting shareholders. Investor relation unit should provide
mechanisms to encourage shareholders to actively monitor and collaborate with firms to
improve corporate governance.
Roles of other stakeholders
58
Stakeholders of companies, such as employees, lenders, suppliers, customers,
communities, are also very important in monitoring corporate governance, identifying
violations, and inefficiencies in governance procedures or structure. There should be a
good whisle blowing channel that is reliable, prompt and active in processing the
compliants or concerns of all stakeholders. The whisle blowing policy should be disclosed
with details that specify how complaints are resolved, and processed. The whisle blowing
policy should specify procedures to ensure that the whisle blower is protected from being
retaliated.
Roles of media, auditing companies, securities companies, investment companies and
institutions should also be active in providing awareness rasing activities to create
collaborative efforts in improving corporate governance in Vietnam.
Conclusion
Improving corporate governance is a big project that requires not only the instant efforts
of the regulators, but also a step-by-step road map of actions for each stage. Besides,
improving corporate governance must come from the internal efforts of each company,
from its governance leaders, the board of directors, and corporate governance supporting
units in the companies, accompanied by activisms of the market. For Vietnam to become
an active member of the ASEAN corporate governance initiative, both external and
internal corporate governance mechanisms should be the areas of focus.
59
APPENDIX 1
LIST OF COMPANIES WITH BEST CORPORATE GOVERNANCE
TOP 3 COMPANIES
IN 2017 ASEAN CORPORATE GOVERNANCE SCORECARD2
Code Company name Industry Stock
exchange
DHG DHG Pharmaceutical Joint Stock Company
Healthcare HOSE
HCM Ho Chi Minh City Securities Corporation Financials - Non-bank HOSE
VNM Vietnam Dairy Products Joint Stock Company
Consumer Goods HOSE
TOP 10 COMPANIES
IN 2017 ASEAN CORPORATE GOVERNANCE SCORECARD 3
Code Company name Industry Stock
exchange
BVH Bao Viet Holdings Financials - Non-bank HOSE
CTG Viet Nam Joint Stock Commercial Bank For Industry And Trade
Financials - Bank HOSE
DHG DHG Pharmaceutical Joint Stock Company
Healthcare HOSE
DPM Petrovietnam Fertilizer And Chemicals Corporation
Industries HOSE
FPT FPT Corporation Telecommunications HOSE
HCM Ho Chi Minh City Securities Corporation Financials - Non-bank HOSE
NVL No Va Land Investment Group Corporation
Property HOSE
2 The list is in alphabetical order of stock code.
3 The list is in alphabetical order of stock code.
60
TRA Traphaco Joint Stock Company Healthcare HOSE
VCB Bank for Foreign Trade of Vietnam Financials - Bank HOSE
VNM Vietnam Dairy Products Joint Stock Company
Consumer Goods HOSE
TOP 50 COMPANIES
IN 2017 ASEAN CORPORATE GOVERNANCE SCORECARD 4
Code Company name Industry Stock
exchange
ACB Asia Commercial Bank Financials - Bank HNX
BBC BIBICA Corporation Consumer Goods HOSE
BID Joint Stock Commercial Bank for Investment and Development of Vietnam
Financials - Bank HOSE
BMP Binh Minh Plastics Joint Stock Company Consumer Goods HOSE
BSI BIDV Securities Joint Stock Company Financials - Non-bank HOSE
BVH Bao Viet Holdings Financials - Non-bank HOSE
BVS Bao Viet Securities Joint Stock Company Financials - Non-bank HNX
CHP Central Hydropower Joint Stock Company
Utilities HOSE
CNG CNG Viet Nam Joint Stock Company Energy HOSE
CTD Coteccons Construction Joint Stock Company
Industries HOSE
CTG Viet Nam Joint Stock Commercial Bank For Industry And Trade
Financials - Bank HOSE
DCM PetroVietnam Ca Mau Fertilizer Joint Stock Company
Industries HOSE
DHC Dong Hai Joint Stock Company of Bentre Materials HOSE
DHG DHG Pharmaceutical Joint Stock Company
Healthcare HOSE
4 The list is in alphabetical order of stock code.
61
DMC Domesco Medical Import Export Joint Stock
Healthcare HOSE
DPM Petrovietnam Fertilizer And Chemicals Corporation
Industries HOSE
EIB Vietnam Commercial Joint Stock Export Import Bank
Financials - Bank HOSE
EVE Everpia Joint Stock Company Consumer Goods HOSE
FPT FPT Corporation Telecommunications HOSE
GMD Gemadept Corporation Industries HOSE
HBC Hoa Binh Construction and Real Estate Corporation
Property HOSE
1
TOP 50 COMPANIES (CONTINUED) 5
Code Company name Industry Stock
exchange
HCM Ho Chi Minh City Securities Corporation Financials - Non-bank HOSE
HPG Hoa Phat Group Joint Stock Company Industries HOSE
HQC Hoang Quan Consulting – Trading – Service Real Estate Corporation
Property HOSE
HSG Hoa Sen Group Materials HOSE
KDH Khang Dien House Trading and Investment Joint Stock Company
Property HOSE
MSN Masan Group Corporation Consumer Goods HOSE
NLG Nam Long Investment Corporation Property HOSE
NTP Tien Phong Plastic JSC Consumer Goods HNX
NVL No Va Land Investment Group Corporation
Property HOSE
PAN The PAN Group Joint Stock Company Consumer Goods HOSE
PNJ Phu Nhuan Jewelry Joint Stock Company
Consumer Goods HOSE
PVD Petrovietnam Drilling & Well Service Corporation
Industries HOSE
PVT PetroVietNam Transportation Corporation
Consumer Services HOSE
REE Refrigeration Electrical Engineering Corporation
Industries HOSE
SAB Saigon Beer - Alcohol - Beverage Corporation
Consumer Goods HOSE
SBT Thanh Thanh Cong Tay Ninh JSC Consumer Goods HOSE
SHS Saigon - Hanoi Securities JSC Financials - Non-bank HNX
SSI Sai Gon Securities Incorporation Financials - Non-bank HOSE
SVC Saigon General Service Corporation Consumer Services HOSE
TCM Thanh Cong Textile Garment Investment Trading JSC
Consumer Goods HOSE
TDH Thu Duc Housing Development Corporation
Property HOSE
5 The list is in alphabetical order of stock code.
2
TLG Thien Long Group Corporation Consumer Goods HOSE
1
TOP 50 COMPANIES (CONTINUED)6
Code Company name Industry Stock
exchange
TRA Traphaco Joint Stock Company Healthcare HOSE
VCB Bank for Foreign Trade of Vietnam Financials - Bank HOSE
VIC Vingroup Joint Stock Company Property HOSE
VJC Vietjet Aviation Joint Stock Company Industries HOSE
VNE Vietnam Electricity Construction Joint Stock Corporation
Energy HOSE
VNM Vietnam Dairy Products Joint Stock Company
Consumer Goods HOSE
VNR Vietnam National Reinsurance Corporation
Financials - Non-bank HNX
6 The list is in alphabetical order of stock code.
2
APPENDIX 2
LIST OF ALL ASSESSED COMPANIES IN 2017 ASEAN CORPORATE GOVERNANCE SCORECARD7
No Code Company name Industry Stock
exchange
1 ACB Asia Commercial Bank Financials - Bank HNX
2 BBC BIBICA Corporation Consumer Goods HOSE
3 BID Joint Stock Commercial Bank for Investment and Development of Vietnam
Financials - Bank HOSE
4 BMI Baominh Insurance Corporation Financials - Non-bank HOSE
5 BMP Binh Minh Plastics Joint Stock Company Consumer Goods HOSE
6 BSI BIDV Securities Joint Stock Company Financials - Non-bank HOSE
7 BVH Bao Viet Holdings Financials - Non-bank HOSE
8 BVS Bao Viet Securities Joint Stock Company Financials - Non-bank HNX
9 CAV Vietnam Electric Cable Corporation Industries HOSE
10 CHP Central Hydropower Joint Stock Company Utilities HOSE
11 CNG CNG Viet Nam Joint Stock Company Energy HOSE
12 CSM The Southern Rubber Industry Joint Stock Company
Consumer Goods HOSE
13 CTD Coteccons Construction Joint Stock Company
Industries HOSE
14 CTG Viet Nam Joint Stock Commercial Bank For Industry And Trade
Financials - Bank HOSE
7 The list is in alphabetical order of stock code.
3
15 DCM PetroVietnam Ca Mau Fertilizer Joint Stock Company
Industries HOSE
16 DHC Dong Hai Joint Stock Company of Bentre Materials HOSE
17 DHG DHG Pharmaceutical Joint Stock Company Healthcare HOSE
1
No Code Company name Industry Stock
exchange
18 DMC Domesco Medical Import Export Joint Stock
Healthcare DMC
19 DPM Petrovietnam Fertilizer And Chemicals Corporation
Industries DPM
20 EIB Vietnam Commercial Joint Stock Export Import Bank
Financials - Bank EIB
21 EVE Everpia Joint Stock Company Consumer Goods EVE
22 FIT F.I.T Group Joint Stock Company Consumer Goods FIT
23 FPT FPT Corporation Telecommunications FPT
24 GAS PetroVietnam Gas Joint Stock Corporation
Utilities GAS
25 GDT Duc Thanh Wood Processing Joint Stock Company
Consumer Goods GDT
26 GMD Gemadept Corporation Industries GMD
27 HBC Hoa Binh Construction and Real Estate Corporation
Property HBC
28 HCM Ho Chi Minh City Securities Corporation Financials - Non-bank HCM
29 HPG Hoa Phat Group Joint Stock Company Industries HPG
30 HQC Hoang Quan Consulting – Trading – Service Real Estate Corporation
Property HQC
31 HSG Hoa Sen Group Materials HSG
32 ITA Tan Tao Investment and Industry Corporation
Industries ITA
33 KBC Kinh Bac City Development Holding Corporation
Property KBC
34 KDC KIDO Group Corporation Consumer Goods KDC
35 KDH Khang Dien House Trading and Investment Joint Stock Company
Property KDH
2
36 LIX Lix Detergent Joint Stock Company Consumer Goods LIX
37 MSN Masan Group Corporation Consumer Goods MSN
38 NBB NBB Investment Corporation Property NBB
1
No Code Company name Industry Stock
exchange
39 NLG Nam Long Investment Corporation Property HOSE
40 NSC National Seed Joint Stock Company Consumer Goods HOSE
41 NTP Tien Phong Plastic JSC Consumer Goods HNX
42 NVL No Va Land Investment Group Corporation
Property HOSE
43 PAC Dry Cell And Storage Battery Joint Stock Company
Consumer Goods HOSE
44 PAN The PAN Group Joint Stock Company Consumer Goods HOSE
45 PC1 Power Construction Joint Stock Company Energy HOSE
46 PGD PetroVietNam Low Pressure Gas Distribution JSC
Utilities HOSE
47 PNJ Phu Nhuan Jewelry Joint Stock Company Consumer Goods HOSE
48 PVD Petrovietnam Drilling & Well Service Corporation
Industries HOSE
49 PVT PetroVietNam Transportation Corporation
Consumer Services HOSE
50 REE Refrigeration Electrical Engineering Corporation
Industries HOSE
51 SAB Saigon Beer - Alcohol - Beverage Corporation
Consumer Goods HOSE
52 SBT Thanh Thanh Cong Tay Ninh JSC Consumer Goods HOSE
53 SCR Sai Gon Thuong Tin Real Estate JSC Property HOSE
54 SHP Southern Hydropower JSC Energy HOSE
55 SHS Saigon - Hanoi Securities JSC Financials - Non-bank HNX
56 SRF Seaprodex Refrigeration Industry Corporation
Industries HOSE
57 SSI Sai Gon Securities Incorporation Financials - Non-bank HOSE
2
58 SVC Saigon General Service Corporation Consumer Services HOSE
59 TCM Thanh Cong Textile Garment Investment Trading JSC
Consumer Goods HOSE
1
No Code Company name Industry Stock
exchange
60 TDH Thu Duc Housing Development Corporation
Property HOSE
61 TLG Thien Long Group Corporation Consumer Goods HOSE
62 TMS Transimex Corporation Consumer Services HOSE
63 TRA Traphaco Joint Stock Company Healthcare HOSE
64 VCB Bank for Foreign Trade of Vietnam Financials - Bank HOSE
65 VHC Vinh Hoan Corporation Consumer Goods HOSE
66 VIC Vingroup Joint Stock Company Property HOSE
67 VJC Vietjet Aviation Joint Stock Company Industries HOSE
68 VNE Vietnam Electricity Construction Joint Stock Corporation
Energy HOSE
69 VNM Vietnam Dairy Products Joint Stock Company
Consumer Goods HOSE
70 VNR Vietnam National Reinsurance Corporation
Financials - Non-bank HNX