A new tie-up between Taiwan’s securities’ depository Taiwan Depository & Clearing Corporation (TDCC) and global corporate governance and proxy firm CGI Glass Lewis will give issuers listed on the Taiwan Stock Exchange (TWSE) and the Taipei Exchange (TPEx) a free copy of their proxy report once it has been published by Glass Lewis.
Commenting on the arrangement, CGI Glass Lewis country head for Australia Stanley Soosur says the business chose Taiwan as the first market to roll out this type of partnership because it found an ideal partner in TDCC, giving Glass Lewis confidence to invest in the Taiwanese market.
‘Taiwan represents a developed governance market, where an understanding and appreciation of ESG issues is strong, making 2021 the perfect time for Glass Lewis to add value in the market,’ Soosur says.
‘With a strong global focus on ESG issues, it has never been more important for companies to understand how investors vote. We aim to promote transparency by providing complimentary Glass Lewis Proxy Paper research reports to corporate issuers listed on TWSE and TPEx. This will help companies gain a detailed understanding of the global proxy voting policies leveraged by our 1,300-plus institutional clients, many of which invest directly via TWSE and TPEx. The reaction to this partnership has increased our engagement with the listed companies and is promoting better disclosures.’
Soosur wouldn’t be specifically drawn on whether the free report was a loss-leader approach to allow the business to offer other services to listed companies in Taiwan.
There are just under 1,000 listed companies on TWSE, representing a market capitalization of $1.19 tn. TPEx tends to attract smaller, emerging companies, with a little more than 770 entities listed on it, representing roughly $172.62 bn in market capitalization.
Soosur says so far the business has not explored a similar approach in other regions because it has a unique partnership with TDCC in that the securities clearing house delivers whole-of-market coverage. ‘Glass Lewis has a strong global footprint and we are excited about the value we will bring to our partnership with TDCC,’ he says.
As to whether the Taiwanese deal is a precursor to similar tie-ups in other markets, he says: ‘We will continue to develop partnerships where we find suitable partners. Whether we engage in further ‘whole-of-market’ partnerships depends on finding the right partner, though at this stage we are focused on TDCC.’