Cairo, December 21, 2006— The International
Finance Corporation and the Egyptian Institute of Directors recently sponsored
a conference to discuss how best to protect shareholder rights. Some
60 representatives from Egypt’s private sector attended the event, which
highlighted voting rights, related party transactions, and insider trading.
Topics included the role of shareholders and how to treat them using best
practices of corporate governance.
Participants reviewed international
best practices in corporate governance and compared them to existing practices
in Egypt. They also looked international best practices on related
party transactions and insider trading. Discussions helped define
solutions on how shareholder rights could be efficiently protected by nonprofit
organizations or through alternative dispute resolution, including arbitration.
“What is often overlooked is how the
quality of shareholder protection affects the depth of capital markets,”
said the Chief Executive Officer of the Egyptian Institute of Directors,
Dr. Ashraf Gamal El Din. “Where laws and corporate action are protective
of shareholders and well enforced, shareholders tend to be willing to invest
their capital. If corporate governance is to be properly implemented,
shareholders must play an active role in making sure that their investments
are carefully considered and protected.
Jesper Kjaer, General Manager of IFC’s
technical assistance facility, the Private Enterprise Partnership for the
Middle East and North Africa, added “Shareholders have to be treated fairly
and with equal regard and respect. This precept conforms to the corporate
governance requirement that directors act in the best interests of all
shareholders and not just the shareholder that may have nominated and elected
them to the board.”
IFC has helped improve corporate governance
in over 80 countries, many of them in the Middle East and North Africa.
IFC is engaged in several corporate governance advisory initiatives
in Egypt, Jordan, Lebanon, Pakistan, and the United Arab Emirates.
The International Finance Corporation,
the private sector arm of the World Bank Group, is the largest multilateral
provider of financing for private enterprise in developing countries. IFC
finances private sector investments, mobilizes capital in international
financial markets, facilitates trade, helps clients improve social and
environmental sustainability, and provides technical assistance and advice
to businesses and governments. From its founding in 1956 through FY06,
IFC has committed more than $56 billion of its own funds for private sector
investments in the developing world and mobilized an additional $25 billion
in syndications for 3,531 companies in 140 developing countries. With the
support of funding from donors, it has also provided more than $1 billion
in technical assistance and advisory services. For more information, visit
About the Egyptian Institute of Directors
The Egyptian Institute of Directors
was launched in 2005. It provides corporate governance services
to private and public sector companies, with a focus on listed companies.
The Institute’s objectives are to become a private, nonprofit, self-financed,
membership-based organization; conduct training events (conferences, roundtables,
seminars, and workshops); launch research and publications to raise awareness
and provide practical guidance on corporate governance; and provide policy
advice to the public sector on improving the legal and regulatory framework
for corporate governance. For more information, visit www.eiod.org.