Stronger punishments are needed for malpractice by company directors, according to a recent survey by the Thai Institute of Directors (IoD).
Most directors who responded said penalties were too light for directors and executives found guilty of unfair treatment of shareholders, including insider trading.
The absence of an ethical corporate culture is also seen as a key factor behind the poor conduct of some directors.
The second annual survey of directors reflects their views on issues of immediate concern.
Conducted between March and May, it drew responses from 416 directors. Given the diversity of respondents' experiences and business types, the survey is believed to fairly represent the overall views of directors in Thailand.
In the survey, 65% of directors said penalties were too light for those taking advantage of other investors by insider trading or stock manipulation. Most said punishment should include fines, jail terms and a disqualification from directorship.
Based on data available on the Securities and Exchange Commission website, the IoD found that most directors or executives found guilty of unfair treatment just paid fines but were able to keep their board seats. Some cases were repeat offences. Penalties should therefore be raised to such levels as to discourage such offences, it said.
"The IoD felt that wrongdoings by directors related to asset malpractice are serious offences that cannot be ignored as they undermine both legal and ethical standards," said Bandid Nijathaworn, president and chief executive of the IoD.
"Therefore, boards should thoroughly probe the persons being nominated for directorship to ensure they have no record of convictions under the Securities and Exchange Act."
Respondents said factors causing directors to perform their duties unethically include the lack of an ethical corporate culture (60%), boards weighing profit over ethics (47%) and inefficient internal control (36%).