Corporate Governance Country Assessment : Colombia
This report assesses the corporate governance policy framework, enforcement and compliance practices in Colombia. The capital markets are small relative to the economy and trading volume is low. The corporate sector is largely owned and controlled...
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| Format: | Accounting and Auditing Assessment (ROSC) |
| Language: | English en_US |
| Published: |
Washington DC
2013
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| Online Access: | http://documents.worldbank.org/curated/en/2003/08/6556478/colombia-report-observance-standards-codes-rosc-corporate-governance-country-assessment-colombia-report-observance-standards-codes-rosc-corporate-governance-country-assessment http://hdl.handle.net/10986/14553 |
| Summary: | This report assesses the corporate
governance policy framework, enforcement and compliance
practices in Colombia. The capital markets are small
relative to the economy and trading volume is low. The
corporate sector is largely owned and controlled by family
groups and conglomerates. The challenge is to create an
environment where medium-sized companies can raise capital
in the market and help them make the transition from
tightly-controlled family firms to public companies. While
pension funds represent a large and rapidly growing source
of funds, they are reluctant to invest in equities. It has
been demonstrated across countries that capital market
development correlates positively with the degree of
shareholder protection and good corporate governance.
Awareness of the importance of corporate governance issues
is growing. Success stories of privatizations linked with
good corporate governance highlight the importance of the
issue. Colombia is an interesting example of the interplay
between legal changes and voluntary initiatives based on the
incentive to attract capital. It has put a minimum corporate
governance disclosure regime in place for companies that
wish to be eligible for pension fund investments. The report
makes policy recommendations that may be grouped under three
broad headings: legislative reform, institutional
strengthening and voluntary/private initiatives. The report
recommends (1) adopting a securities bill as proposed by the
securities regulator Supevalores; (2) adopting international
standards and creating an independent audit oversight board;
(3) improving enforcement; (4) enhancing compliance
monitoring with the code of good governance; and (5)
creating a director training organization. |
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