Pioneering Better Governance: The Myanmar Institute of Directors

Helping Companies Improve Governance, Board Professionalism, Conduct, and Transparency

Myanmar companies should make improving board performance, corporate conduct, and transparency a priority, according to board members of the Myanmar Institute of Directors (MIoD), the first independent organization to promote corporate governance standards and best practices in the country.

The launch of MIoD on March 21, 2018 attracted around 150 regulators, officials, business leaders, and other distinguished guests. At the opening ceremony, MIoD Chairman and Shwe Taung Group CEO U Aung Zaw Naing highlighted the institute’s vision to become a pioneering organization in supporting the development of company directors and improving the effectiveness of boards.

At the launch, five MIoD board members underscored some of the key governance challenges facing Myanmar enterprises during a panel discussion moderated by fellow board member Mr. Melvyn Pun, CEO of Yoma Strategic. The panelists were His Excellency U Soe Win, Minister of Planning and Finance and former head of Deloitte Myanmar; Daw Win Win Tint, CEO of City Mart Holding Co.; Daw Khine Khine Nwe, Joint Secretary General of the Republic of the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI); Ms. Vicky Bowman, head of the Myanmar Centre for Responsible Business; and Prof. Dr. Aung Tun Thet, UMFCCI Advisor and Member of the Myanmar Investment Commission.

Among the most urgent tasks, they say, is the need for companies to produce financial reports that paint a clear picture of their performance and install proper controls within their organizations; at present, board members, auditors, banks, and investors often struggle with company financial statements that fail to meet adequate transparency and disclosure requirements.

Ms. Bowman said many large private companies have already taken steps to enhance their transparency and seen their rating improving on the Pwint Thit Sa report, a large-scale study that ranked 182 Myanmar public, private, and listed companies on 74 criteria from auditing practices and ethics to whether the company has a website. But more needs to be done to make Myanmar a better place to do business, she said.

“As Myanmar companies continue to grow, the role of the board becomes more prominent and directors are faced with increasingly tough decisions over seeking financing, entering new markets, and sustaining business growth,” said MIoD Chairman U Aung Zaw Naing. “The board no longer just oversees a company’s activities but also needs to drive its strategy, and this is where a directors’ institute can play a vital role – MIoD can equip directors with the necessary training and tools to improve the board’s functioning and decision-making.”

MIoD was established with the support of the International Finance Corporation (IFC) and the governments of Australia and the United Kingdom. Mr. Vikram Kumar, IFC Myanmar Country Manager, and Ms. Liz Patterson, Private Sector Adviser of the U.K. Department for International Development, gave opening remarks at the launch and expressed their support for MIoD.

The institute is governed by a board of 14 directors including senior representatives of the Directorate of Investment and Company Administration and the Securities and Exchange Commission of Myanmar (SECM), prominent company CEOs, and heads of organizations representing market stakeholders. It aims to advance board professionalism, promote business ethics and transparency, create networks between corporate leaders and stakeholders, and boost investor confidence in Myanmar’s private sector.

MIoD will join a network of 120 similar directors’ institutes around the world as standard bearers of governance and responsible business for their respective markets. At the launch, Dr. Bandid Nijiathaworn and Ms. Joyce Koh, the respective heads of the Thai and Singapore institutes of directors, shared how they have helped companies adopt effective governance and control structures to enhance transparency and build sustainable businesses since the 1997 Asian financial crisis.

Daw Tin May Oo, MIoD board member and SECM Commissioner, agreed that transparency should be made a priority as Myanmar develops a regulatory and supervisory framework for its capital markets. Chairman Aung Zaw Naing said MIoD would support the regulators on the passage of market-enhancing legislations such as the Investment Law, the Financial Institutions Law, and the Companies Law to boost private sector development in Myanmar.

In his closing remarks, His Excellency U Soe Win said Myanmar companies have immense potential to contribute to the country’s growth, but they should also bear the responsibility of helping to build a dynamic and transparent market.