Corrupt Thai Politicians Subvert Country's Reforms by Phairath Khampha 30 November 2002 Thailand might already have passed the proper legislation to ensure transparency and good corporate governance in the aftermath of the Asian financial crisis, but little actually has been done to transfer the written word into action, according to Michael Backman, an author and analyst of Asian business. While Singapore, Hong Kong, Malaysia and South Korea had recovered well and learned their lessons from the 1997 crisis, successfully establishing a framework of transparency and corporate governance, Thailand was limping along with the Philippines in battling corruption, Mr Backman said. The country continues to be a black hole of corruption continuing to erode social and economic stability. "It is easy to write and pass legislation. It is in the implementation that the problems begin. Thailand hasn't done well. There was a lot of promise and noise from politicians after the crisis, but reform has been subverted by politicians," said Mr Backman, author of several books including Asian Eclipse: Exposing the Dark Side of Business in Asia, published in 1999. Many cultural aspects, including Thai business culture where companies are often "the extension of families", the favouring of loyal staff over productive staff and the kreng jai (respectful of others' feelings even when perhaps one should speak up for the good of society and everyone implicated) and hai kiat (treating others with honour under a patronage system, even when they are corrupt, dishonest and murderers) did not help to foster corporate governance or curb corruption. "Most businesses are owned by families, so it is like an extension of the famil--the firm is not running on corporate principles," he said. Poor wages among Thailand's civil servants, police and journalists also did little to help fight corruption, said Mr Backman, who in November 2002 was in Bangkok to promote his latest book, co-authored with Charlotte Butler, Big in Asia: 25 Strategies for Business Success. Likening Prime Minister Thaksin Shinawatra to Silvio Berlusconi, Italy's extremely corrupt prime minister who also happens to be his country's richest citizen, Mr Backman asked what the repercussions on the business community would be if Mr Thaksin lost the next election. "Thaksin will always be there. The concern is what will happen when he's no longer prime minister. He has close ties to the business community--the conflict of interest is enormous. For investors, it all comes down to perception, and it doesn't look good." Mr Backman said that fighting corruption also called for a well-resourced media that was paid well and that was not threatened by the government, as it is in Thailand. Though Thailand was "falling behind in a relative sense to Malaysia, China and South Korea", Mr Backman said that foreign investors did see value in Thailand as its economy was diversified and had a lot of depth. What would turn the situation around would be the elimination of corruption.