Opinions from businesses should not be the sole consideration in the decision over whether labor representatives should be required on corporate boards, New Power Party (NPP) Legislator Huang Kuo-chang (黃國昌) said at the Legislative Yuan in Taipei yesterday, adding that the Financial Supervisory Commission had only included corporations in an opinion survey on proposed legislation.
“While shareholders own firms, corporate governance is moving more in the direction of separating ownership and management,” Huang said at a meeting of the Finance Committee.
“It is also clear that the results of a corporation’s success or failure do not only affect shareholders, they also affect its employees,” he said.
Committee members discussed proposed amendments to the Securities and Exchange Act (證券交易法) to require the appointment of labor representatives on all corporate boards.
Huang said that corporate opinion should not be the only “standard” against which new legislation is measured, given that the right of shareholders to elect a majority of board members would not be affected.
The proposed amendments were put on hold after Financial Supervisory Commission Chairwoman Jennifer Wang (王儷玲) raised concerns with them, citing opposition from 76 percent of listed companies surveyed by the commission last year.
Wang said that while the commission was not opposed to requiring boards to include labor representatives, amendments should not be forced through in the absence of public “consensus” and clear “supplementary measures” to prevent disturbances to corporate management.
Taoyuan Confederation of Trade Unions chairman Chuang Fu-kai (莊福凱) said the presence of labor representatives on boards of nationally owned firms — which has been mandated since 2000 — has given unions a voice regarding company operations.
The proposed amendments are “necessary to ensure that the firm’s finances and policies are fully transparent and we understand its future development and policies,” Chuang said.
“They would provide peace of mind while employees work,” Chuang added.
The Taiwan Union Monitor of Corporate Responsibility said in a statement that labor representatives on corporate boards were the “last mile” in the path toward corporate democracy.