Monday, March 2, 2015

E-voting mandated for listing companies in Taiwan

Democracy takes on many forms and is exercised in a variety of situations. The most common and best-known mechanism where individuals cast their vote is in the context of a governmental election, as would be the case when citizens elect a new mayor of the city or president of the country. E-voting has been demonstrated in a number of democracies around the world, including Estonia and Brazil, but the context of voting—and the use of electronic voting technology—is not limited to the context of electing government officials.  

Students at a school vote for a class president, for example, and board members vote on a variety of issues in corporations and companies of all sizes. And just as innovation, security and integrity are cornerstones of a solid government election, these same principles apply in the context of business and corporate voting too. To this end, the Taiwan Stock Exchange (TWSE) has just made the unprecedented move of facilitating e-voting among listed companies. Indeed, the TWSE expects that more than half of the listed companies will opt for e-voting mechanisms by next year.

That is over 400 companies in a country that is becoming increasingly well known for technology innovation. Global brands like Asus, Gigabyte and Acer are all based in Taiwan.

One of the major goals of this initiative is that the TWSE wants to enhance “the corporate governance of the Taiwanese capital market and [facilitate] the adoption of e-voting for the benefit of foreign and domestic investors.”

Key stakeholders in a number of Taiwanese companies have the right to have their voices heard in the context of corporate decision making and the adoption of e-voting allows them to exercise this right more easily and more freely. The move toward more widespread use of e-voting allows for greater transparency among corporate decision-making and corporate governance, forcing executives to be held more accountable for the directions that their companies take.

The ruling comes by way of Taiwan's Financial Supervisory Commission (FSC), which will now require all listed companies in the TWSE to adopt e-voting if they have over $2 billion of paid-in-capital and over 10,000 shareholders. For any shareholder meetings that take place after January 1, 2016, an electronic voting option must be in place. As it stands, over 200 companies have already adopted e-voting as part of their governance process and this initiative should lead to some hundreds more.

Major corporate decisions, like the election of directors and supervisors, will now be more transparent with greater accountability than ever before. This is a model that can and should be followed in many other corporate environments around the world. E-voting facilitates better representation of shareholders because of greater accessibility both to the voting mechanism and to the reports of results.

Taiwan is a country that has long since aimed to balance its traditional values and heritage with the fast-moving advances of modern technology. It comes with a great culture and a storied history, but Taiwan is also home to some of the biggest names in the technology industry. In this way, it only follows reason that it would be among the first to mandate the implementation of e-voting technologies in corporate governance processes. 

And this once again demonstrates that discussion of e-voting need not be restricted to the context of public government elections; it can be applied to nearly every segment of the modern world.