Thursday, May 8, 2008
PFS Program’s tenth Regional Survey – Reporting on Corporate Social Responsibility (CSR) by the Largest Listed Companies in Eleven CEE Countries
Today, the Partners for Financial Stability (PFS) Program publishes its tenth semi-annual Survey of Reporting on Corporate Social Responsibility (CSR) by the Ten Largest Listed Companies (by market capitalization) in 11 Central and Eastern European (CEE) Countries. This edition of the survey was co-financed by DWS Investments (Deutsche Bank Group). PFS Program Intern Dominik Grodzki (Poland), PFS Program Assistant Magdalena Grabowska and PFS Program Research Assistant Igor Solodovnik conducted the survey from March 1 through April 30, 2008.
Companies in Czech Republic, Estonia, Latvia, Lithuania, Slovakia and Slovenia were surveyed for the tenth time; companies in Hungary and Poland were surveyed for the ninth time; and companies in Bulgaria, Croatia and Romania were surveyed for the eighth time. Moreover, a fourth analysis of peer companies (the ten largest listed companies by market capitalization) in Brazil, Russia, India and China (BRIC) as well as Ukraine allows for ongoing benchmarking with these emerging market peers.
PFS Program surveys analyze the annual reports and websites of the ten largest listed companies in the above-mentioned 11 CEE countries in order to document the current disclosure practices of this “blue-chip” peer group and identify best practice among the peer group. Whereas the universe of companies surveyed may change over time due to changes in a company’s market capitalization, the semi-annual surveys of reporting on CSR represent a snapshot of this peer group’s CSR disclosure practices on a given day twice a year. Furthermore, by analyzing disclosures in both annual reports and websites, the surveys track the timing of the publication of the annual report and the related yet separate issue of periodic disclosure, namely, how blue-chip companies keep their websites data-rich and up-to-date. The surveys enable companies to benchmark their disclosure practices against peers on a national, industry and regional basis.
This survey analyzes companies’ disclosures in English (in the English-language annual report and on the English-language company website) during the time period March – April 2008 on the following three topics: corporate governance, environmental policy and social policy. The record date for the disclosures is April 15, 2008.
This edition of the survey documents a generally higher level of online disclosure of corporate governance information, continuing the trend over the past five years. Slightly more information is also disclosed in the area of social policy, compared with the previous survey published in September 2007. Disclosure of information about environmental policy has increased on company websites; however, significant progress remains to be made in disclosing information on environmental policy in the annual report.
Overall, companies in BRIC outperform CEE peers in terms of the availability of English-language websites and annual reports as well as specific disclosures in all three areas. In the field of corporate governance, the most significant difference concerns disclosure of information regarding compliance with a corporate governance code and a company-specific code of business conduct/code of ethics in both the website and annual report. In general, BRIC companies also provide more information on social policy and environmental policy. Due to the lack of a number of drivers, Ukrainian companies lag behind both BRIC and CEE peers in all areas. However, the number of Ukrainian companies with English-language websites has increased steadily over the past two years.
29 of the 110 CEE companies surveyed (26%) provide a stand-alone environmental, social and governance (ESG) report online in English on the record date of April 15, 2008. This represents a significant improvement over the most recent survey and continuation of an ongoing trend: 22 of the companies surveyed (20%) published such a report in September 2007, compared with 19 companies (17%) in April 2007 and 17 companies (15%) in September 2006. A list of companies that publish a stand-alone environmental, social and governance (ESG) report online in English may be found as a separate document below.
Survey findings include the following:
• 96% of the 110 CEE companies surveyed have an English-language website on the record date of April 15, 2008, compared with 94.5 % in September 2007, 94% in April 2007, 94% in September 2006, 87% in April 2006, 89% in September 2005 and 82% in April 2005. In comparison, 100% of the BRIC companies surveyed and 70% of the Ukrainian companies surveyed have an English-language website.
• 87% of the 110 CEE companies surveyed have a 2006/2007 English-language annual report online on the record date of April 15, 2008 compared with 100% in BRIC and 30% in Ukraine.
• Nine Slovene, eight Polish, eight Hungarian, seven Estonian, four Bulgarian, four Czech, four Latvian companies, one Croatian, one Lithuanian and one Romanian company disclose information regarding compliance with a corporate governance code on the company website. Nine Slovene, eight Estonian, seven Polish, six Czech, six Lithuanian, four Croatian, four Hungarian, three Bulgarian, three Slovak, two Romanian and one Latvian company disclose this information in the annual report.
• 64% of the 110 CEE companies surveyed disclose information on employee development/benefits on their website. This result has remained constant at 64% for the past four surveys.
• 24% of the 110 CEE companies surveyed disclose information on energy and water use on their website, compared with 17% in September 2007, 17% in April 2007, 21% in September 2006, 18% in April 2006, 20% in September 2005, 20% in April 2005 and 23% in August 2004.
• 29 of the 110 CEE companies surveyed (26%) publish a stand-alone English-language ESG report as of April 15, 2008. Of the 29 reports published in CEE, 27 (93%) use recognized standards and eight (28%) include a third-party assurance statement.
• 17 of the 40 BRIC companies surveyed (42.5%) publish a stand-alone English-language ESG report. Of the 17 reports published in BRIC, 14 (82%) use recognized standards and ten (59%) provide a third-party assurance. No Ukrainian company produces such a report as of the record date of April 15, 2008.
Note: The survey consists of the three following documents: a report of the survey findings presenting data aggregated by country; a database of individual data by company for the ten largest listed companies in each of the 11 CEE countries; and a separate database of individual data by company for the ten largest listed companies in BRIC and Ukraine. This edition of the survey includes a newly-designed and more user-friendly database which lists the companies surveyd in the first spreadsheet, entitled, „Table of Contents (LOC).”
To download the survey, the database and a separate list of companies that publish an English-language stand-alone ESG report, please click on the links below:
Thursday, April 24, 2008
Opening of the East-West Management Institute (EWMI) Representative Office in Poland
On Thursday, April 24, 2008 the East-West Management Institute (EWMI) Representative Office in Poland was opened.
The office will implement the Partners for Financial Stability (PFS) Program, in cooperation with counterparts across SEE and CEE.
As of October 1, 2007 USAID’s priorities for the PFS Program in SEE are: Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Montenegro and Serbia.
Friday, April 11, 2008 - Sunday, April 13, 2008
Lectures on Corporate Governance
Gdansk, Poland
From April 11-13, 2008 Geoffrey Mazullo, Director, PFS Program gave a series of lectures on corporate governance as part of the School of American Law organized by the Faculty of Law and Administration of the University of Gdansk.
In the first lecture, Mr. Mazullo reviewed information presented during the first set of lectures delivered in January 2008, including: analysis of various models of corporate governance; explanation of the rights/responsibilities of corporate organs; and specific examples of corporate governance in practice, demonstrated by company-specific case studies. He then presented the most recent research conducted and co-financed by the PFS Program on reporting on corporate governance and corporate social responsibility (CSR) by listed companies in 11 Central and Eastern European (CEE) countries; Brazil, Russia, India and China (BRIC); and Ukraine. Each of the remaining lectures consisted of a case study regarding a particular corporate governance or CSR issue. The case studies discussed concern companies listed and/or operating in Cambodia, China, the Netherlands, Germany, Poland, the United Kingdom and the United States. Mr. Mazullo presented for the second time a case study written by PFS Program colleagues about the ongoing corruption scandal at the German industrial conglomerate Siemens AG. The case study is a work in progress; it will be revised and updated as details regarding this case unfold.
Through an agreement with the School of American Law, students who attend the lectures and complete the School of American Law may apply for an internship with the PFS Program. The School of American Law finances part of the costs of the internship, namely travel and accommodation costs of the student/intern. Between summer 2004 and April 2008, 18 graduates of the School of American Law completed a PFS Program internship.
During the one-month unpaid internship, the intern conducts one of the PFS Program’s ongoing semi-annual regional surveys: Investor Relations Online: Survey of Websites of the Largest Listed Companies in 11 Central and Eastern European (CEE) Countries or Survey of Reporting on CSR by the Largest Listed Companies in 11 CEE Countries. In summer 2008, Polish interns will be paired with interns from South East Europe, thereby enhancing both the internship experience and the quality of the PFS Program surveys.
To download the materials presented at the lectures, please click on the links below:
Wednesday, March 12, 2008 - Thursday, March 13, 2008
Regional Workshop on Corporate Governance of Insurance Companies
Tirana, Albania
On Wednesday, March 12 and Thursday, March 13, 2008 the Albanian Financial Supervisory Authority (AFSA) and the PFS Program held a Regional Workshop on Corporate Governance of Insurance Companies.
This Regional Workshop, held in Tirana, marked the PFS Program’s first activity in Albania and its 105th regional event since the PFS Program was launched in late 1999.
The AFSA invited the PFS Program to co-organize this Regional Workshop in order to promote the implementation of best practice and adoption of international standards of corporate governance in the Albanian insurance market. A primary goal of the Workshop was to educate Albanian insurance regulators and senior decision-makers of Albanian insurance companies about corporate governance of insurance companies in new member states of the European Union. The practical information presented, debated and discussed at the Regional Workshop provided reference points and benchmarks for comparison with developments in Albania. The PFS Program emphasizes case study and peer based learning in all its training programs.
At the outset of the Workshop, Keler Gjika, Deputy Chair, AFSA, presented an overview of the Albanian insurance market and the current framework for corporate governance of insurance companies in Albania. Thereafter, Gorazd Podbevsek, Socius, outlined the framework for corporate governance of insurance companies in Slovenia. Boris Persak, Zavarovalnica Maribor d.d. presented two case studies of insurance fraud and their governance implications. The PFS Program presented a case of a Swedish insurer whose corporate governance system collapsed, thereby allowing excessive and unauthorized executive compensation. At the end of the first day of the Workshop, Audrius Linartas, Insurance Supervisory Commission of Lithuania, described the framework for corporate governance of insurance companies in Lithuania.
On the second day of the Workshop, Anna Miernicka-Szulc described the framework for corporate governance of insurance companies in Poland. Pawel Dudzicz, Polish Financial Supervision Authority, shared two case studies regarding regulating and supervising the activities of Polish insurance companies. Jim Vint, FTI Technology Consulting, ended the Workshop with a presentation about data governance and a case study about the consequences of an insurance company’s poor data governance.
The participant profile was as follows: 45 Albanian participants, including 22 staff members of the AFSA; four representatives of donors and international financial sector firms active in Albania; a representative of the Insurance Agency of Bosnia and Herzegovina; and two representatives of the Central Banking Authority of Kosovo.
The PFS Program appreciates the contribution of speakers from Albania, Lithuania, Poland, Slovenia and the US to this Workshop, part of an ongoing PFS Program regional initiative in the area of insurance supervision. The current mandate of the PFS Program is to engage financial sector institutions in SEE target countries in programs that help promote the identification of best practice and the adoption of international standards. Within this mandate, one important element of each PFS Program activity is the exchange of experience of the new member states of the EU with EU accession countries in SEE.
To download the Workshop agenda, a brief biography of each speaker, the presentations and the list of participants, please click on the links below:
 | Agenda - Regional Workshop on CG of Insurance Companies - March 12-13, 2008.pdf - 34 KB |
| Opening Presentation - PFS Program - March 12, 2008.pdf - 396 KB |
| Presentation - AFSA - March 12, 2008.pdf - 252 KB |
| Brief Bio - Keler Gijka - March 2008.pdf - 10 KB |
| Presentation - Slovenia - Socius - March 12, 2008.pdf - 88 KB |
| Brief Bio - Gorazd Podbevsek - March 2008.pdf - 11 KB |
| Presentation - Slovenia - ZM dd - March 12, 2008.pdf - 54 KB |
| Brief Bio - Boris Persak - March 2008.pdf - 11 KB |
| Presentation - PFS Program - Case in Point - March 12, 2008.pdf - 419 KB |
| Brief Bio - Geoffrey Mazullo - March 2008.pdf - 16 KB |
| Presentation - Lithuania - Insurance Supervisory Commission - March 12, 2008.pdf - 172 KB |
| Brief Bio - Audrius Linartas - March 2008.pdf - 11 KB |
| Presentation - Corporate Governance of Polish IC - March 12, 2008.pdf - 280 KB |
| Background Paper - Corporate Governance of Polish Insurance Companies - March 2008.pdf - 60 KB |
| Brief Bio - Anna Miernicka-Szulc - March 2008.pdf - 11 KB |
| Presentation - PFSA - March 13, 2008.pdf - 361 KB |
| Brief Bio - Pawel Dudzicz - March 2008.pdf - 98 KB |
| Presentation - Data Governance - FTI - March 13, 2008.pdf - 195 KB |
| Brief Bio - Jim Vint - March 2008.pdf - 10 KB |
| List of Participants - CG of Insurance Companies - March 12-13, 2008.pdf - 63 KB |
Friday, March 7, 2008
Workshop – How to Write A Case Study
Zagreb, Croatia
On Friday, March 7, 2008 the Case Study Writing Project, e-STUDENT, Faculty of Economics and Business, University of Zagreb, and the PFS Program held a Workshop entitled, “How to Write a Case Study.”
This was the third time that Geoffrey Mazullo, Director, PFS Program was invited to teach the introductory Workshop launching the annual Case Study Writing Project at the Faculty of Economics and Business.
40 students from the Case Study Writing Project, e-STUDENT, participated in the Workshop. A representative of the Securities Commission of the Federation of Bosnia and Herzegovina, two representatives of the Securities Commission of Republika Srpska and a representative of the Macedonian Stock Exchange also participated.
This event is part of an ongoing PFS Program regional initiative to introduce students and faculty as well as recent gradates of South East European (SEE) educational institutions to a wide range of analytical and writing skills necessary to writing a high-quality, professional case study.
During the course of the Workshop, students were presented a wide range of case studies, ranging from brief “cases in point” to full-blown case studies. The Workshop explained in practical terms how a case study should present in-depth material; cite data and sources; note comparisons and/or contrasts; pose a range of questions; and demonstrate numerous issues. Furthermore, the Workshop demonstrated that a successful case study should explain the relationship between the specific “case” (company, example or situation) and general benchmarks, best practice, international standards, etc. Even when a case is unique and does not enable comparisons, this should be explained.
At the outset of the Workshop, the PFS Program presented the rationale behind launching its ongoing semi-annual regional surveys: Investor Relations Online and Surveys of Reporting on Corporate Social Responsibility (CSR) by the Largest Listed Companies in 11 Central and Eastern European (CEE) countries. Thereafter, students discussed the methodology for the surveys and a wealth of data from the surveys as well as other sources. At the end of Session 1, the PFS Program described the use of the surveys and their impact.
During Sessions 2 and 3, students analyzed a number of case studies regarding particular issues in corporate governance and/or CSR that the PFS Program uses in its training programs. The case studies discussed concern companies listed and/or operating in Germany, the Netherlands/the United Kingdom, Sweden and the United States.
At the end of Session 3, the PFS Program explained step by step the mechanics of writing a case study about an assigned topic. Each student received a checklist of case study evaluation criteria. The checklist was analyzed in detail, in order to prepare students for the mechanics of the case study writing process.
Through the Workshop, students were introduced to valuable case study writing skills and gained insights into the current status of corporate reporting in Croatia as well as other CEE and SEE countries. They will apply this knowledge in writing case studies about Croatian companies. Also, students who participated in the Workshop may apply for a one-month unpaid internship with the PFS Program in summer 2008. PFS Program interns work on the above-mentioned PFS Program regional surveys.
To download the Workshop agenda and presentations, please click on the links below:
Tuesday, March 4, 2008
PFS Program’s 14th Regional Survey - Investor Relations Online: Survey of Websites of the Largest Listed Companies in Eleven CEE Countries
Today, the PFS Program publishes its 14th semi-annual Survey of Online Investor Relations of the Ten Largest Listed Companies (by market capitalization) in eleven Central and Eastern European (CEE) countries. PFS Program Assistant Magdalena Grabowska and PFS Program Intern Lukasz Gilewicz conducted the survey from February 1 through February 29, 2008.
In this edition of the survey, disclosure in almost all categories remains at or reaches its highest level since the first survey was conducted in August 2001. This trend has been observed since February 2006 and may be viewed as sustainable. This edition of the survey documents an ongoing increase in disclosure of detailed governance information.
90% of the companies surveyed provide a list of management online, compared with 86% in August 2007. This is the largest percentage recorded since the surveys began in 2001. 63% of the companies surveyed provide additional information about management online, compared with 59% in August 2007 and 53% in February 2007. This is also the largest percentage recorded since the surveys began in 2001.
87% of the companies surveyed provide a list of board members online and 52% provide additional information on board members. The former category increased to a new record since the first survey was conducted, from 82% in August 2007. Disclosure in the latter category also reached a new record, posting a slight increase from 51% in August 2007 and a significant increase over 40% in February 2007.
Investor Relations Online: Survey of Websites of the Largest Listed Companies in CEE analyzes the websites of the ten largest listed companies in Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovak Republic and Slovenia. For the fourth time, the survey also analyzes companies in BRIC (Brazil, Russia, India and China) as well as Ukraine in order to compare the online disclosure practices of CEE listed companies with peers in other emerging markets.
The survey analyzes the English-language websites and annual reports of the ten largest listed companies in the above-mentioned CEE countries in order to document the current disclosure practices of this ‘blue-chip’ peer group. Although the market capitalization of companies changes over time, the semi-annual surveys represent a snapshot of disclosure practices of the blue-chip peer group on a given day twice a year. Since the definition of the survey universe has remained the same since the first survey, the surveys provide time-series data for CEE blue-chip companies and thus enable the identification of online disclosure trends as well as best practice within the peer group.
The survey provides current data as of February 15, 2008 and comparisons with the 13 previous surveys, conducted in August 2007, February 2007, August 2006, February 2006, August 2005, February 2005, August 2004, February 2004, August 2003, February 2003, August 2002, February 2002 and August 2001.
Since 2004, the survey includes recommendations on the ideal corporate website and compares CEE companies with the parameters of this ideal. This component of the survey identifies best practice and enables CEE companies to benchmark their disclosure against peers in the region, other emerging markets and industry best practice. Here also, the time-series data identifies online disclosure trends.
Survey results include the following:
Websites: In nine of the 11 CEE countries surveyed, each of the ten largest listed companies has a local-language website on February 15, 2008. In Bulgaria and Lithuania, nine of the ten companies surveyed have a local-language website. In the previous survey, 109 companies surveyed had a local-language website. One of the ten Bulgarian companies surveyed did not have a local-language website.
94.5% of the companies surveyed have an English-language website; the percentage increased from 93% in August 2007.
Information on Management: 90% of the companies surveyed provide a list of management online; 63% provide additional information on management. As noted above, in each category the results represent a new record high since the first survey was conducted in 2001.
Information on Board Members: 87% of the companies surveyed provide a list of board members online and 52% provide additional information on board members. The former category increased to a new record since the first survey was conducted, from 82% in August 2007. Disclosure in the latter category also reached a new record, posting a slight increase from 51% in August 2007 and a significant increase over 40% in February 2007.
Comparisons with BRIC and Ukraine: The largest listed companies in BRIC equal or outperform their CEE peers in every category. However, the gap continues to narrow. Furthermore, when companies in BRIC are compared with peers in the eight CEE countries that joined the EU in 2004, the difference between the peer groups is much smaller. The Ukrainian companies surveyed disclose less information than their peers in both BRIC and CEE. However, the disclosures made by the Ukrainian companies improved vis-à-vis the previous survey. Detailed comparisons include the following:
- Each of the companies surveyed in BRIC has a local language website. In nine of the 11 CEE countries surveyed, each of the companies surveyed has a local language website. In Bulgaria and Lithuania, nine of the ten companies surveyed have a local language website. In Ukraine, nine of the ten companies surveyed have a local language website.
- 100% of the companies surveyed in BRIC have an English website, compared with 94.5% in CEE-11, 99% in the eight CEE countries that joined the EU in 2004 and 70% in Ukraine.
- 100% of the companies surveyed in BRIC provide a list of management online, compared with 90% in the CEE-11 and 94% in the eight CEE countries that joined the EU in 2004. In Ukraine 30% of the companies surveyed provide a list of management online.
- 87.5% of the companies surveyed in BRIC provide additional information on management online, compared with 63% in the CEE-11, 71% in the eight CEE countries that joined the EU in 2004 and 20% in Ukraine.
- 100% of the companies surveyed in BRIC provide a list of board members online, compared with 87% in the CEE-11, 91% in the eight CEE countries that joined the EU in 2004 and 20% in Ukraine.
- 87.5% of the companies surveyed in BRIC provide additional information on board members online, compared with 52% in CEE-11, 64% in the eight CEE countries that joined the EU in 2004 and 10% in Ukraine.
The survey contains information compiled in the following groups and sub-groups:
- Current data on 110 companies in eleven CEE countries;
- Separate data on 80 companies in eight CEE countries that joined the European Union (EU) on May 1, 2004;
- Separate data on 30 companies in Bulgaria, Croatia and Romania;
- Comparisons of the data from this current survey with data from the previous 13 surveys conducted every August and February since August 2001; and
- Separate data on 50 companies in Brazil, Russia, India and China (BRIC) as well as Ukraine.
To download the survey, a presentation of survey results and the company database, please click on the links below:
Wednesday, February 20, 2008
EU Corporate Governance Standards: A Seminar for EU Candidate and Potential Candidate Countries, Including Lessons Learned from New Members
European Parliament, Brussels, Belgium
On Wednesday, February 20, 2008 the Global Corporate Governance Forum, the European Commission, the European Parliament, the IFC, the Slovenian Presidency of the European Union, and the PFS Program held a Seminar entitled, “EU Corporate Governance Standards: A Seminar for EU Candidate and Potential Candidate Countries, Including Lessons Learned from New Members.” The Seminar took place at the European Parliament in Brussels, Belgium.
The key objectives of the Seminar were to:
• Raise awareness about existing EU corporate governance requirements and guidelines;
• Assist candidate and potential candidate countries to better access relevant EU information;
• Assist candidate and potential candidate countries to participate in current EU debates on issues including corporate governance control mechanisms, cross-border voting and executive pay; and
• Review lessons learned from the new EU member states.
Detailed information about the Seminar, including the agenda, background papers, presentations, speaker biographies and list of participants may be found on a sub-page of the website of the Global Corporate Governance forum devoted to the Seminar.
The PFS Program co-financed the participation of senior representatives of financial sector regulatory authorities and stock exchanges from Albania, Bosnia and Herzegovina, Croatia, Macedonia, Montenegro and Serbia in the Seminar. Through their participation, senior decision-makers of these regulatory and self-regulatory authorities gained valuable insights into the development of corporate governance standards in line with EU best practice.
Friday, January 11, 2008 - Sunday, January 13, 2008
Lectures on Corporate Governance
Gdansk, Poland
On January 11-13, 2008 Geoffrey Mazullo, Director, PFS Program gave a series of lectures on corporate governance as part of the School of American Law organized by the Faculty of Law and Administration of the University of Gdansk and Chicago-Kent College of Law.
31 Polish students attended the course. During the three days, students were introduced to the following topics: corporate governance models (including the Anglo-US, German, Japanese and Polish models); disclosure regimes; the legal and self-regulatory framework for corporate governance; the rights and responsibilities of corporate organs, including management and the board; shareholders’ rights; trends in non-financial reporting by listed companies (reporting on corporate governance); and the use of governance information by shareholders and stakeholders.
Students discussed practical and theoretical aspects of corporate governance in several jurisdictions (including Poland) by analyzing a number of case studies about real companies covering each of the above-mentioned topics.
A second set of lectures will follow in April 2008, during which students will analyze additional case studies related to corporate governance, corporate social responsibility (CSR) and reporting on environmental, social and governance (ESG) criteria.
Through an agreement with the School of American Law, students who attend the lectures and complete the School of American Law may apply for an internship with the PFS Program. The School of American Law finances part of the costs of the internship, namely travel and accommodation costs of the student/intern. Between summer 2004 and summer 2007, 16 graduates of the School of American Law completed a PFS Program internship.
During the one-month unpaid internship, the intern conducts one of the PFS Program’s ongoing semi-annual regional surveys: Investor Relations Online: Survey of Websites of the Largest Listed Companies in 11 Central and Eastern European (CEE) Countries or Survey of Reporting on CSR by the Largest Listed Companies in 11 CEE Countries. In 2008, Polish interns will be paired with interns from South East Europe, thereby enhancing both the internship experience and the quality of the PFS Program surveys.
To download the materials presented at the lectures, please click on the links below:
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