New report on Corporate Governance in Turkey from OECD

OECD says “Corporate governance is improving in Turkey but some challenges remain”

Corporate governance is improving in Turkey but some key issues, including the potential for unfair treatment of minority shareholders, need to be tackled if Turkish firms are to take full advantage of opportunities to grow in coming years, according to a new OECD report.

OECD also prepared a detailed Principle-by-Principle assessment.

Report says in some situtations controlling shareholders impose commercial conditions that go against the interests of the company as a whole and minority shareholders.

In parallel, the OECD urges Turkey to give greater scope to institutional investors in the exercise of their rights as shareholders. At present, pension and mutual funds regulated by the Capital Markets Board (CMB) cannot participate actively in governance of the companies in which they invest and are subject to portfolio limits that restrict their incentives to monitor corporate governance practices. These restrictions should be eliminated and funds should disclose the corporate governance policies that they apply to their investments.