The Taiwan Stock Exchange (TWSE) and the Taiwan Corporate Governance Association (TCGA) jointly organized the seminar, “The Implementation and Prospects of the Stewardshp Principles of Institutional Investors”, on March 29. Through this seminar, TWSE aims to utilize market mechanisms to gain momentum of promoting corporate governance within Taiwan’s capital market. The seminar was co-chaired by the chairman of TCGA, Lu Daung-Yen, and the president of TWSE, Michael Lin. Numerous prominent domestic and foreign experts and heads of investment institutions were also invited to participate.
　
TWSE states that stock market value held and daily transaction volume contributed by institutional investors account for nearly 50 percent of the overall market. Institutional investors play an important role in market stability and development, not to mention affecting the business decisions of their investee companies. The so-called "stewardship" of institutional investors refers to the expectation that institutional investors fulfill their responsibilities as equity owners or managers. Through participation in the shareholders' meetings, voting, monitoring, and dialogue and interaction, institutional investors should continue to focus on the investee company's strategy, risk, capital structure, corporate governance, return on investment, and other such aspects to enhance the long-term interests of the company and shareholders.
　
In this seminar, Founding Secretary General of the Asian Corporate Governance Association, Mr. Jamie Allen, and the CEO of Hermes EOS, Dr. Hans Christoph Hirt, respectively illustrated the trends of stewardship internationally and best practices of how institutional investors monitor investee companies, cast votes and interact with senior managements. Furthermore, Professor Jerry Fong of National Chengchi University introduced the contents of one of Taiwan’s current drafts-“Steward Principles of Institutional Investors”. Professor Fong believes that the content of the Principles is consistent with international trends. The draft has also been slightly modified according to the characteristics of Taiwan’s capital market, and complements the “Corporate Governance Best Practice Principles for TWSE/GTSM Listed Companies”.
　
The second half of the seminar was chaired by the vice chairman of TCGA, Liu Wen Zheng. The deputy director general of the Bureau of Labor Funds, Tsai Chung-Chun, the chairperson of Chunghwa Post, Ong Wen-chyi, the chairman of the Securities Investment Trust and Consulting Association of the R.O.C., Lin Hong-li, and the president of Cathay Securities Investment Trust, Chang Yung-Chuan were invited as speakers. Mr. Tsai believes that the Bureau of Labor Funds’ largest stakeholder group is laborers and should properly prepare its investment policy accordingly. Furthermore, it should also consider social responsibilities and the quality of information disclosure in determining investment targets. Mr. Ong points out that he personally leads Chunghwa Post to continuously visit a number of chairpersons of investee companies. He further believes that long-term development should be the primary consideration of investments. Based on this philosophy, his discussion with those chairpersons mainly focused on long-term issues including corporate governance and environmental impact. Mr. Lin stresses that the investment chain structure is complex. In promoting stewardship, the responsibilities of asset owners and managers should not be the only thing considered. The impact of intermediaries would also be as important. Mr. Chang states that Cathay Financial Holdings has been implementing Principles for Responsible Investment (PRI), and supports the spirit of stewardship. He also reminds retail investors to absorb the experiences of institutional investors to think long-term rather than focusing on short-term profit.