Corporate Governance in Chile 2010

Corporate Governance in Chile 2010


65 pages


This review of corporate governance in Chile describes the corporate governance setting including the structure and ownership concentration of listed companies and the structure and operation of the state-owned sector. It then examines the legal and regulatory framework and company practices to assess the degree to which the recommendations of the OECD Principles of Corporate Governance and the OECD Guidelines on Corporate Governance of State-Owned Enterprises have been implemented.



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Date de parution 31 janvier 2011
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EAN13 9789264095953
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Cor por at e G over nance i n Chi l e 2010
This work is published on the responsibility of the Secretary-General of the OECD. The opinions expressed and arguments employed herein do not necessarily reflect the official views of the Organisation or of the govern ments of its member countries.
Please cite this publication as:
OECD (2011),Corporate Governance in Chile, Corporate Governance, OECD Publishing.
Series: Corporate Governance
ISSN 2077-6527 (print)
ISSN 2077-6535 (online)
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© OECD 2011
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For ew or d
This Review of Corporate Governance in Chile is part of a series of reviews of national policies undertaken for the OECD Corporate Governan ce Committee. It was prepared as part of the process of Chile’s accession to OECD membership.
The OECD Council decided to open accession discussi ons with Chile on 16 May 2007 and an Accession Roadmap, setting out the term s, conditions and process for accession, was adopted on 30 November 2007. In the Roadmap, the Council requested a number of OECD Committees to provide it with a fo rmal opinion. In light of the formal opinions received from OECD Committees and other re levant information, the OECD Council decided to invite Chile to become a Member of the Organisation on 15 December 2009. After completion of its internal pro cedures, Chile became an OECD Member on 7 May 2010.
The Corporate Governance Committee (the “Committee”) was requested to examine Chile’s position with respect to core corporate gov ernance features and to provide Council with a formal opinion on Chile’s willingnes s and ability to implement the recommendations laid down in theOECD Principles of Corporate Governance(the “Principles”) and theOECD Guidelines on Corporate Governance of State-Owned Enterprises(the “SOE Guidelines”).
This report, prepared as part of the Committee’s ac cession review, highlights some of the key corporate governance challenges facing C hile. A major feature of Chile’s corporate governance landscape is the concentrated ownership structure and limited liquidity that characterises its capital market, with most firms controlled by conglomerates or business groups. As in other juris dictions with similar corporate structures, concerns arise that minority shareholde rs may be vulnerable to irregular practices by controlling shareholders to extract private benefits at their expense through practices such as abusive related party tra nsactions or self-dealing.
Chile has made considerable progress in improving i ts corporate governance framework, first through laws adopted in 2000 on Pu blic Tender Offers and on Corporate Governance, and more recently through a s ignificant Corporate Governance law approved by Congress in September 2009, just prior to the conclusion of this review. The law established new protection for mino rity shareholders through enhanced transparency standards and mechanisms to address us e of privileged information, related party transactions and conflicts of interes t, and provisions to improve the definition of independent directors and to strength en their role in reviewing sensitive issues. In addition, the new law approved by Congre ss in October 2009 to strengthen governance of Chile’s largest state-owned enterpris e, the copper mining company Codelco, is an important reform that may give momen tum to further reforms of other Chilean SOEs.
The review also found that Chile should continue to pursue corporate governance improvements in a number of areas. For example, con cerns were raised about the need for additional checks and balances to strength en the independence of the Superintendency of Securities and Insurance and pro tect against the risk of political intervention in enforcement decisions. While Chile has taken positive steps to improve
the governance of its pension funds and to guard ag ainst conflicts of interest in their investment decisions, further improvements are desi rable in relation to other institutional investors such as mutual funds and in surance companies. In addition, further SOE governance improvements, not yet addres sed by the Codelco reforms, remain on the reform agenda.
This review of corporate governance in Chile was co nducted on the basis of a comprehensive self-assessment by the Chilean authorities and Chile’s answers to a detailed questionnaire on state-owned enterprises, supplemented by information gathered from Secretariat fact-finding missions, in terviews with public officials, market participants, academics and relevant literature. Su ccessive drafts of the report were discussed with Chilean representatives at joint mee tings of the Corporate Governance Committee and its Working Party on State Ownership and Privatisation Practices in November 2008 and April and November 2009. This fin al version of the report reflects the situation as of November 2009. It is released o n the responsibility of the Secretary General of the OECD.
The review was prepared by Daniel Blume and Cuauhte moc Lopez-Bassols under the overall supervision of Mats Isaksson, Grant Kirkpatrick and Robert Ley of the Directorate for Enterprise and Financial Affairs. T he analytical framework is explained in Annex A and detailed information on Chile’s state-owned enterprises is provided in Annex B.
Tabl e of Cont ent s
Title Page Copyright Page Foreword List of Tables Table of Figures Chapter 1 - Assessment and Recommendations Chapter 2 - Corporate Governance Review ANNEX A - Analytical Framework for the Accession Re view ANNEX B - Key Characteristics of Chile’s State-Owne d Enterprises ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT
Li st of Tabl es
Table 2.1 Table 2.2
Tabl e ofFi gur es
Figure 2.1 Figure 2.2