Private sector lacks transparency: survey
By Thanh Trung - The Saigon Times Daily
HCMC - The quality of corporate management and administration in Vietnam’s private companies shows a weakness and a need to improve, according to research conducted by Economica Vietnam under a project jointly supported by Vietnam’s corporate and investment law working team and United Nations Development Programme.
According to Le Duy Binh and Dau Van Anh of Economica Vietnam, a model of corporate administration is typical of family-owned and family-run companies with the owner often taking the role of director as well as technical manager and owners of joint-stock and private limited companies often take many roles.
The research says that family members contribute money to set up a company for which they also work. Their roles in corporate management and administration are legally vague, making it difficult for them to know their rights and duties.
The report also shows a lack of long-term and sustainable business plans in many Vietnamese private companies, caused by an unstable legal framework and non-transparent business environment. A lack of financial disclosure in private companies is a common problem and many private companies have yet to implement financial reports as regulated.
The percentage of enterprises filing financial reports in accordance with Vietnam’s corporate law is small and financial reports that are filed are usually prepared without care. Their concern is to cope with the tax authority instead of publicizing. These facts lead to Vietnamese enterprises’ popular conception that they are losers to other entrepreneurs if they publicize their financial management, said the report.