South Asian firms urged to look beyond governance compliance

An Indonesia corporate governance body has said businesses must "internalise" good practice, rather than viewing it as something forced upon them by regulators.

Speaking to the Malaysian Star, Professor Sidartha Utama of the Indonesian Institute for Corporate Directorship said too many firms consider corporate governance as a simple matter of compliance.

He also said majority shareholders have a duty to promote governance standards and ensure such issues remain on the corporate agenda.

"Many companies look at corporate governance as some sort of regulation that they must comply with. In substance, they don't internalise it," Professor Utama told the newspaper.

He was speaking during a visit to Kuala Lumpur for a meeting of the Working Group of the Asian Roundtable on Corporate Governance in Asia.

The event was jointly hosted by the Securities Commission Malaysia and the Organisation of Economic Co-operation and Development (OECD).

New updates to the OECD's white paper on corporate governance in Asia, initially published in 2003 and revised in 2006, are set to form the agenda at several meetings across the continent this year.