Hong Kong-listed China Forestry Holdings announced yesterday a laundry list of wide-reaching failures in corporate governance.
The scandal-ridden firm admitted: 'The company has not established clear procedures for shareholders' meetings, board meetings and committee meetings, had not established procedures for formulating and approving business objectives and budgets, did not regularly monitor risks, lacked an internal audit department, has not established plans for business growth, had not kept records of weekly backup data, had adopted anti-corruption policies but such policies had not been appropriately enforced.'
The announcement did not seem to faze The Carlyle Group, a US firm that owns nearly 11 per cent of China Forestry as part of the US$147 billion of assets it manages globally.
'The company still has real value,' a Carlyle spokesman said.
China Forestry said yesterday it was implementing measures to improve internal controls, including setting up a five-year business plan, monthly budgets and an internal audit department and monitoring related-party transactions.
The Carlyle spokesman said: 'The business has stabilised. The management team has been replaced. The new management team is strengthening its corporate governance and internal controls.'
Since last year, Carlyle has been working closely with an independent investigation and auditors in rectifying China Forestry's problems, the spokesman said.