Corporate Governance Country Assessment : Republic of Peru
This report assesses the corporate governance policy framework, and enforcement and compliance practices in Peru. Corporate governance reform is at an early stage, and some legislation has recently been upgraded to protect shareholder rights. The m...
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| Language: | English en_US |
| Published: |
Washington, DC
2013
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| Online Access: | http://documents.worldbank.org/curated/en/2004/06/6583114/peru-report-observance-standards-codes-rosc-corporate-governance-country-assessment http://hdl.handle.net/10986/14479 |
| Summary: | This report assesses the corporate
governance policy framework, and enforcement and compliance
practices in Peru. Corporate governance reform is at an
early stage, and some legislation has recently been upgraded
to protect shareholder rights. The major issues are driven
by the growing importance of private pension funds, which
have become the most important institutional investors. At
present, the governance structure of the pension fund
administrators is weak, and there are not enough checks and
balances to deal with conflicts of interest. Improving the
internal governance structure is crucial in order to ensure
the preservation of private savings for retirement. Voting
and board representation policies are being developed by the
regulator, so that pension funds can assume an active role
as shareholders of their portfolio companies. The report
recommends that: (1) the procedures governing the general
meetings should be amended to encourage shareholder
participation; (2) the related party transactions'
approval process should be more transparent and allow
shareholders to opt to challenge transactions that are
unfair to them; (3) the thresholds to challenge corporate
decisions should be lowered and harmonized for all listed
companies, and (4) there should be a requirement for a
minimum number or percentage of independent directors on the
boards of listed companies and for the creation of audit
committees, and (5) directors should have access to adequate
training so as to understand their duties and
responsibilities. The report also proposes increased
independence and a strengthening of enforcement mechanisms
for the securities regulator. |
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