Book Description

This report analyzes the securities market and the main groups of institutions operating in the Czech Republic's capital market, namely, investment funds, pension funds, and insurance companies. It also examines corporate governance, based on the performance of publicly traded companies and an analysis of the relevant pieces of legislation; and the area of regulatory framework for banks which is relevant to the analysis of corporate governance. After providing an overview of the current status of capital market reforms, the report identifies the remaining gaps in the regulatory and institutional framework for the securities market, investment funds, the internal and external mechanisms for corporate governance as well as the private pension fund and insurance company sectors. Policy recommendations include restrict the number of publicly tradable companies, integrate the different trading channels, improve regulatory enforcement, manage the opening of investment funds, improve pricing rules, privatize state-controlled banks and utilities, strengthen minority shareholder protection, improve disclosure and the quality of information, improve monitoring of boards by shareholders, enhance the banks' capacity to handle problem debtors, streamline the bankruptcy process, enact measures that would improve pension fund regulation, strengthen the regulatory framework for the insurance sector, and ensure greater compliance with European Union directives.