Ulaanbaatar, Mongolia, June 12, 2018—IFC,
a member of the World Bank Group, held the 10th annual Corporate Governance
Forum today in Ulaanbaatar. The event focused on enhancing investor protection,
which is timely, as almost half of the state-owned enterprises in Mongolia
are to be privatized over the next two years. The forum was co-hosted by
the Financial Regulatory Commission (FRC) of Mongolia and the Corporate
Governance Development Center (CGDC).
More than 100 regulators, policymakers, business
leaders, and corporate governance professionals attended the forum. Experts
highlighted the importance of proper disclosure and transparency in companies’
reporting to better protect investors. They also discussed the latest local
and international regulatory developments related to corporate governance.
“Attracting both foreign and local investment
is important for the Mongolian economy, but we need to make sure that our
corporate governance standards meet international best practices and provide
adequate protection for investors,” said FRC Chairman Davaasuren Sodnomdarjaa.
“Good corporate governance is essential to building sustainable companies
and further developing Mongolia’s capital markets.”
Investor protection is gaining prominence,
especially because public participation in the Mongolian stock market is
likely to increase after the government’s recent approval of a plan to
privatize almost half of the state-owned enterprises between now and 2020.
Since its inception 26 years ago, the Mongolian
Stock Exchange has made tremendous progress, recording its highest turnover
last year. Market capitalization rose about 67 percent compared to five
years ago, with several successful initial and secondary public offerings
attracting interest from both foreign and Mongolian investors.
The Mongolian translation of the G20/OECD
Principles of Corporate Governance, a globally recognized benchmark for
assessing and improving governance practices, was also launched at the
forum. Studies show that stronger governance enhances company performance
and reduces risks, thus making such companies more attractive to investors.
“To build a vibrant capital market, Mongolia
needs to strengthen the supervision of listed companies and enforcement
of market regulations. Introducing international principles and standards
will cultivate a stronger corporate governance culture among Mongolian
companies,” said Tuyen D. Nguyen, IFC Resident Representative in Mongolia.
“We believe the forum will help regulators and other market participants
to stay on top of the latest developments and adopt effective measures
to cope with emerging governance issues.”
Since 2009, IFC has been supporting Mongolia’s
efforts to enhance corporate governance practices, including the development
of a corporate governance scorecard in 2013 and regulations governing related-party
disclosures to protect minority investors. These efforts are part of the
broader IFC Corporate Governance Program in East Asia and the Pacific,
which is implemented in partnership with the State Secretariat for Economic
Affairs of Switzerland.
IFC—a sister organization of the World Bank and member of the World Bank
Group—is the largest global development institution focused on the private
sector in emerging markets. We work with more than 2,000 businesses worldwide,
using our capital, expertise, and influence to create markets and opportunities
in the toughest areas of the world. In FY17, we delivered a record $19.3
billion in long-term financing for developing countries, leveraging the
power of the private sector to help end poverty and boost shared prosperity.
For more information, visit www.ifc.org
The Financial Regulatory Commission strives to ensure the stability of
the financial market, regulate financial service institutions, monitor
the implementation of all relevant legislations, and protect the rights
of investors and participants of the financial markets. The Commission
is a specialized government body for regulation and control over different
segments of the financial system including the insurance market, the securities
market, nonbank financial institutions, and savings and credit cooperatives.
For more information, visit www.frc.mn
The Corporate Governance Development Center is a membership-based professional
training and research institution established in June 2009 to advance corporate
governance practices in Mongolia. It actively cooperates with the Financial
Regulatory Commission and the Mongolian Stock Exchange in reforming Mongolia’s
business regulatory environment. For more information, visit www.cgdc.org.mn.