Corporate Governance Country Assessment : Czech Republic
The Czech securities markets are rapidly evolving under political and commercial pressures. However, shortcomings remain that undercut their role in price discovery, and limit their value as risk diversification, as a source of finance and a mechan...
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| Format: | Pre-2003 Economic or Sector Report |
| Language: | English en_US |
| Published: |
Washington, DC
2013
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| Online Access: | http://documents.worldbank.org/curated/en/2002/07/6556029/czech-republic-report-observance-standards-codes-rosc-corporate-governance-country-assessment http://hdl.handle.net/10986/14529 |
| Summary: | The Czech securities markets are rapidly
evolving under political and commercial pressures. However,
shortcomings remain that undercut their role in price
discovery, and limit their value as risk diversification, as
a source of finance and a mechanism for good corporate
governance. Ownership concentration resulting from
privatization in the early 1990s was accompanied by opaque
deals and price manipulation, and owners often exploited
control and acted against the interests of enterprises,
creditors and minority shareholders. The policy
recommendations may be grouped into three broad categories:
legislative reform, institutional strengthening, and
voluntary/private initiatives. In 2001, the Czech Republic
instituted broad financial regulatory reforms. However,
related party transactions, insolvency and more technical
issues, such as voting by mail and shareholder meetings,
still require more attention. Institutional strengthening is
also vital to improve enforcement. The judiciary, Securities
Commission, and other institutions that oversee financial
market participants should be strengthened. Finally, in the
area of voluntary/private initiatives, this report
recommends enhanced training opportunities for Czech directors. |
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