Search results

Purpose – This paper introduces the special issue on accounting in Asia. It summarises and reflects on themes and findings emerging from the papers in this volume.

Design/Methodology/Approach – The findings reported in the paper are based on desk research and review of the papers contained in the volume.

Findings – The papers evidence that corporate governance and financial reporting quality are interlinked. Accounting in Asia is preoccupied with the corporate governance–financial reporting quality nexus in the face of convergence with International Financial Reporting Standards (IFRS).

Research limitations/Implications – Policy makers in Asian countries need to develop appropriate regulatory mechanisms to address cultural issues, namely, attitudes towards secrecy and fraud, to ensure effective implementation of IFRS. This entails sound grounding in ethics and integrity within the financial reporting stakeholder community. Additionally, unintended consequences of fair value application need to be examined in the Asian context.

Originality/Value of paper – This paper is a summary of seven studies in Asia. The studies highlight critical issues emerging from Asia's experience with corporate governance reforms and the move to IFRS convergence, and set the agenda for future research in accounting in Asia, specifically, and emerging economies, generally.

Reforms in corporate governance in selected Asian countries were introduced after the financial crisis of 1997–1998. After the financial collapse, several crisis-affected economies overhauled their corporate governance, strengthening market forces, implementing tougher regulations and focusing on transparency in decision-making and accountability. Since then, a commitment to improving corporate governance has grown as governments recognised the need to protect investors’ interests, reduce systemic market risks, maintain financial stability and enhance investors’ confidence to encourage the return of capital to the region through better accountability and transparency. The incentive for corporations to follow best practice is to boost their corporate performance and attract investment. Effective corporate governance is also recognised as essential for economic growth. Governments are realising that good governance of corporations is a source of competitive advantage and critical to economic and social progress.

Since the financial crisis, corporate governance has become a key policy issue in most of Asia. Progress in reforming corporate governance, however, has been uneven across Asia. This paper documents that progress.

This study utilizes World Bank Governance Indicators to investigate government effectiveness in Asia, both regionally and across sub-regions. Several factors seem to influence the level of government effectiveness: accountability and voice, control of corruption, and wealth and income. The presence of a democratic form of government does not seem to be an important factor, but we note that more sensitive measures of democracy might produce more positive results. We then comment on the strengths and weaknesses of the dataset and offer some suggestions for future research.

This chapter reports the progress of corporate governance reforms in nine East Asian economies as disclosed through two independent studies. The first study is a stock-taking exercise to take note of on-going reforms in corporate governance rules and regulations through a scorecard on corporate governance conducted by experts among the regional economies. The second study covers perceptions of the implementation and enforcement of corporate governance rules as seen by fund managers and analysts. The two studies yield different results, indicating a divergence between the regulatory environment and market perceptions of corporate governance practices in the nine economies.

This chapter offers an empirical examination of the impact of World Governance indicators (WGIs) on stock market development. The understanding is based on the premise of institutional economics that strong institutional governance, in terms of laws and regulations, results in positive developments in financial institutions.

The data which covers the years 1996–2016, include all world countries where a stock market operates. The authors use standard statistical tools that include Johansen co-integration test, linearity, normality tests, and regression analysis, together with discriminant analysis as a robustness check.

The empirical findings show that (a) a negative association exists between Voice and Accountability and stock market development, (b) a positive association exists between each of Political Stability, Government Effectiveness, Regulatory Quality, Rule of Law and Control of Corruption, and stock market development for most World’s regions stock markets, (c) both Voice and Accountability and Political Stability indicators are the major influential indicators for the stock market development across world stock markets.

This chapter offers quantitative evidence about the benefits of strong institutional governance to stock market development. In addition, the chapter offers significant guidelines to policymakers regarding the institutional factors that can be enhanced to promote stock market development.

Corporate governance is regarded as a major issue during the post-financial crisis period in Asia. These countries have implemented corporate governance reforms to enhance the protection of shareholders and stakeholders interests. Such reforms have affected the conduct of business of all corporations in the region as it allows for greater monitoring especially by the shareholders. Unlike earlier studies which focused on non-financial firms, this study analyzes the corporate governance of listed banking firms in nine Asian emerging markets. Corporate governance mechanisms that serve to monitor the banking firms can be classified into Ownership Monitoring Mechanism, Internal Control Monitoring Mechanism, Regulatory Monitoring Mechanism, and Disclosure Monitoring Mechanism. This paper suggests that there are differences in the monitoring mechanisms of banking firms and non-bank firms.

Bidhya Bowornwathana is associate professor at the Department of Public Administration, Faculty of Political Science, Chulalongkorn University, Bangkok, Thailand. His research interests are on governance and administrative reform. His writings appear in journals such as Governance: An International Journal of Policy and Administration, Public Administration and Development, Australian Journal of Public Administration, Asian Survey, Public Administration Quarterly, Public Administration: An International Quarterly, Asia Pacific Journal of Public Administration, Asian Review of Public Administration, and Asian Journal of Political Science. He has written several books in Thai on administrative reform and public administration. He co-edited a book with John P. Burns on Civil Services Systems in Asia (Edward Elgar, 2001). He also has chapters in recent books such as in Christopher Pollitt and Colin Talbot, eds., Unbundled Government (Taylor and Francis, 2004), Ron Hodges, ed., Governance and the Public Sector (Edward Elgar, 2005), Eric E. Otenyo and Nancy S. Lind, eds., Comparative Public Administration: The Essential Readings (Elsevier, 2006), and Kuno Schedler and Isabella Proeller, eds., Cultural Aspects of Public Management Reform (Elsevier, 2007). He was Chairman of Department of Pubic Administration, Chulalongkorn University. He has served several times as member and secretary of the national administrative reform commissions appointed by Thai governments.

Corruption can take many forms. One of the most alarming aspects of corruption has been the impact of money laundering on financial markets. The amount of money laundered in the Asian region is estimated at approximately $200 billion, or one-fifth the global total. Some of the Asia-Pacific countries still lack any consistent anti-money laundering legislation. The Asia-Pacific region is also home to five of the six remaining non-cooperative countries and territories on The Financial Action Task Force's 2004 list. In this paper, I present a clinical examination of the impact of money laundering and Off-shore financial centres on Asian Pacific financial markets. I describe the money laundering cycle, tools and techniques utilized in the Asia-Pacific region as well as anti-money laundering measures and regulation.

In Hong Kong higher education, students' learning outcomes are increasingly treated as evidence to inform course and teaching improvement. Therefore, outcome-based teaching and learning (OBTL) has been encouraged by the University Grants Committee (UGC) since 2007. OBTL has gradually been implemented by Hong Kong higher education institutions (HEIs) to enhance student learning outcomes. Relating OBTL to the social cohesion/regulation matrix, this chapter aims at analyzing how OBTL is being implemented by the HEIs in Hong Kong. Given the high institutional autonomy and academic freedom afforded to individual HEIs, each university has established its own systematic framework for integrating outcome-based approaches into its teaching, learning, and assessment. Unlike other higher education systems in Asia with strong government supervision, the government in Hong Kong acts as an enabler and facilitator, leaving the UGC to invite international experts as an independent audit body to assure the quality of student learning. As a result, this chapter chooses the eight UGC-funded universities to investigate how they engage their faculty members in OBTL, and what the enabling and hindering factors are. Based upon the social cohesion/regulation matrix, the Hong Kong higher education system is featured by the individualist way of promoting OBTL. Nonetheless, while universities are empowered with institutional autonomy to decide upon teaching, and student learning matters, their strong orientation with OBTL means they cannot simply do whatever they like. Adopting a robust quality assurance mechanism in evaluating university performance through University Accountability Agreements, the institutional autonomy that universities enjoy rests heavily upon their performance in teaching and student learning, which is assessed through rigorous international benchmarking via the Quality Assurance Audit conducted by the UGC and research performance through the Research Assessment Exercise. This chapter discusses the unique university governance of Hong Kong through the critical review of OBTL being adopted in teaching and learning in Hong Kong universities.