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Investors Acknowledge Progress on Corporate Governance in Latin America


In Buenos Aires:
Karina Manasseh

Phone: 4316-7080

Email:
kmanasseh@ifc.org


Buenos Aires, June 22, 2006 –  International and regional investors meeting today in Buenos Aires at the seventh annual meeting of the Latin American Corporate Governance Roundtable acknowledged the progress made by the region’s companies on corporate governance and published the conclusions from discussions between investors and representatives of the Companies Circle.  The meeting highlighted consensus among investors and corporations that best practices in corporate governance create added value for companies.

“The Companies Circle meeting generated great enthusiasm,” said John Willcox, Senior Vice President of the TIAA-CREF pension fund. “Corporate governance practices have meant that Brazil and other countries in Latin America have not been ignored amid ongoing trends in the international financial market.”

Present at the meeting were specialists, investors, businessmen, and experts from the region and member countries of the OECD.  Countries represented include Belgium, Brazil, Canada, Chile, Colombia, Costa Rica, Ecuador, Mexico, Panama, Peru, Spain, the United Kingdom, the United States, and Venezuela. Although this was the second meeting of the Roundtable to be held in Argentina, only a small number of Argentinian companies were present.

At this meeting of the Roundtable, speakers emphasized that companies should be aware that there are various types of investors with differing levels of commitment. The companies present also requested that investors be clearer about the criteria on which they base their investment decisions. A further important point raised was the need to develop creative techniques for identifying companies that follow good practices.

Roque Benavides, President of the Peruvian mining company Buenaventura, stated that leading companies are recognizing the importance of good practices in corporate governance, as well as the need to communicate progress as investors will increasingly take good practices into account. “Our company in Peru is controlled, through pension funds, by 3 million Peruvians, but they are unaware of this fact.”

Benavides added that institutional investors, such as the International Finance Corporation, also have an important role to play, for it was over a period of 20 years in which the company received consecutive loans from IFC that Buenaventura began implementing changes aimed at greater transparency in its operations.

The Roundtable was organized by the Organization for Economic Cooperation and Development (OECD) and IFC.  It was hosted by the Buenos Aires Stock Exchange and the National Securities Commission of Argentina.