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The corporate governance implications of globalization for Colombian Companies

The offices of Pinilla, González & Prieto in the heart of Bogotá’s business district was the venue for the Legal 500 round table on corporate governance and OECD norms. Attendees included in-house representatives of industries ranging from insurance (Aon Risk Solutions) and banking (BBVA Colombia), to mining (Inter American Coal), pharmaceuticals (Bayer) and consumer groups such as Unilever and Reckitt Benckiser, as well as service sector companies such as Colombian Business Services. We were also fortunate enough to count on the presence a former senior partner from a global law firm, now active in consultancy, whose experience on both sides of the table was invaluable.

With globalization, cross-border M&A transactions and a fast-developing regulatory framework changing the landscape of Colombia’s corporate governance regime, businesses are facing an increasingly complex scenario requiring the careful balancing of regulatory and disclosure responsibilities, as required by foreign investors while also protecting local shareholders. The vibrant conversation that ensured touched on matters including the rights and equitable treatment of shareholders, operations between linked parties (both intra-group and subsidiary/headquarters), managing conflicts of interest, information disclosure and transparency (in both open and closed corporations) and the fiduciary duties of administrators. And while Chatham House Rules prevent us detailing precisely who said what, Inter-American Coal’s Ana Maria Echeverria and Aon Risk Solutions’ Julian Avila made particularly incisive contributions – as did Gulland Padfield’s James Edberg and firm managing partner Felipe Pinilla.

Indeed, by chance, the roundtable was held at an interesting –and significant—juncture: just days before the referendum on the peace agreement proposed by the administration of President Juan Manuel Santos. This backdrop seemed to inform -or detonate!- the conversation, which saw the emergence of differences not as regard the applicability and value of OECD norms and other corporate governance measures, but rather of the Colombian State’s ability to oversee and effectively enforce such regulatory requirements in a context where immediate local factors can, from one day to the next, overshadow all other concerns.

Scroll down below to see photos from the evening.