Plea made to regulators for global governance standard

The International Federation of Accountants (IFAC) has urged securities watchdogs to jointly develop a globally accepted corporate governance standard.

Robert Roussey, chairman of the International Auditing Practices Committee - which sets the federation's professional standards - said a strong demand for an international standard of corporate governance had emerged as the world's financial markets became more globalised.

'What we are seeing is that companies used to only sell shares within their own countries but are now selling their shares all over the world,' Mr Roussey said.

'The biggest problem we see is that there is a need for a set of global corporate governance standards that would be applicable to any company selling their shares outside their national borders.' Notably, the global capital market has grown from less than US$10 trillion in the late 1980s to more than $32 trillion now.

For Hong Kong companies to be able to attract, for example, US investors or vice versa, a common set of rules should be shared, according to Jim Sylph, technical director of the IFAC.

The World Bank, the Organisation for Economic Co-operation and Development (OECD), governments and securities watchdogs would be responsible for setting the world standard of corporate governance.

Discussions on how to implement corporate governance at regional and global levels were expected to take place in the future, Mr Roussey said, as the issue had already attracted World Bank and OECD attention.