ISSN: 2222-6990
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The accelerated growth in international trade and commerce brought by robust technology development commonly referred to as 'globalisation’ has attracted the interest of governments and businesses and legal harmonisation. Harmonisation of law improves legal certainty and predictability. As most corporations in Asia are highly concentrated, it has been acknowledged that the protection of minority shareholders is considerably weak. It is believed that this perception of weakness is caused by a poor corporate disclosure regime, lack of independence in the executive boards, as well as lack of protection of the minority shareholders. One of the initiatives was to harmonise the laws via the ASEAN Disclosure Standards that allows cross-listing offering of financial products and services in ASEAN by removing regulatory barriers and ASEAN members’ restrictive national measures and replacing them with common disclosure standards. This paper discusses the use of model laws as instruments of legal harmonisation by drawing comparisons to the European Union’s Shareholder Rights Amending Directive 2017/828. This paper finds that the ASEAN Disclosure Standards does not incorporate the ex-ante approval process, absence of approval from an independent body such as independent directors and approval by the minority shareholders. This paper makes two recommendations to strengthen the regulatory framework in the ASEAN Disclosure Standards to protect the minority shareholders’ interest in RPTs and ultimately to achieve better corporate governance in the region.
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In-Text Citation: (Razak et al., 2021)
To Cite this Article: Razak, M. U. bin A., Rahmat, N. E., Mahali, M., & Azmi, I. I. (2021). Harmonisation of Related Party Transactions Disclosure Framework Under the Asean Disclosure Standards. International Journal of Academic Research in Business and Social Sciences, 11(11), 1064 – 1075.
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