QIC: Promoting the long-term value of SMEs will become a major focus among foreign investors
Quantum International Corp. (QIC) and the Taiwan Corporate Governance Association jointly hosted an online seminar on September 16 titled “Embracing TWSE’s Corporate Value Enhancement Program: Linking Shareholder Value and ESG,” attracting participation from over 200 listed companies. QIC founder and CEO Alex Lee noted that more than half of the top 20 foreign institutional shareholders in Taiwan’s stock market invest in small- and mid-cap companies. He emphasized that focusing on investor communication and ESG practices to drive SMEs’ long-term value will become a key theme among foreign investors going forward.
The event opened with remarks from Chao-En Hsieh, Deputy Manager of the Corporate Governance Department at the Taiwan Stock Exchange (TWSE). He pointed out that in recent years, most Asian stock markets have underperformed compared to major global markets, as companies’ intrinsic value has not been fully reflected in market valuations. This has led to capital outflows and reduced market liquidity. To strengthen the competitiveness of Taiwan’s capital markets, TWSE launched the Corporate Value Enhancement Program last year, encouraging listed firms to focus on three areas: current-state analysis, policies and plans, and communication and tracking. The program has also been incorporated into this year’s Corporate Governance Evaluation indicators, requiring companies to adopt concrete measures, report to their boards, and disclose progress in a dedicated section of the Market Observation Post System (MOPS).
Lee stated that TWSE’s initiative aligns with QIC’s long-standing focus on creating long-term equity value. To date, 120 listed companies have published their enhancement plans. He highlighted that shareholder value comes not only from revenue and profit, but also from balance sheet management, ESG, investor communication, dividend and buyback policies, and market liquidity. However, he noted that only about 20% of Taiwanese companies currently achieve a return on invested capital (ROIC) above their weighted average cost of capital (WACC), indicating room for improvement in capital efficiency.
Lee further observed that, among the top 20 foreign institutional shareholders in Taiwan, each holds an average of 300 local companies. Yet, there are fewer than 150 mid- and large-cap firms with a market cap above USD 2 billion. This shows that foreign investors also allocate capital to smaller companies. Thus, precisely targeting investors, clearly articulating long-term strategies, and demonstrating shareholder value are critical for companies seeking to enhance investor confidence.
Pak Wing Chung, Director at S&P Global Sustainable1, noted that Taiwanese companies perform impressively in sustainability. In 2025, 69 firms were included in the S&P Global Sustainability Yearbook, ranking Taiwan second worldwide. He emphasized that the CSA’s value lies in its breadth, depth, and comparability, enabling investors to better assess companies’ long-term value.
At the same time, Chung highlighted the importance of supply chain management. Although most companies recognize its significance, only about half have formal supplier codes of conduct, and just 9% exclude non-compliant suppliers. This indicates a gap between assessment and procurement decisions. He stressed that supply chain failures can lead to severe reputational and financial risks, making systematic due diligence and management essential for ensuring long-term value.
Tina Chang, Associate Director of Sustainable Investing at Fidelity International, stated that ESG has become “business as usual” in the investment process. Fidelity uses its proprietary forward-looking ESG rating system to evaluate management’s ability and strategic mindset in addressing material issues. She emphasized that governance (G) is the foundation of ESG and the core of creating long-term shareholder value. Fidelity fulfills its fiduciary duties through engagement and proxy voting, with a focus on governance, climate change, and deforestation. She added that while Taiwanese companies lead the Asia-Pacific region in ESG disclosure, they should focus more on forward-looking strategies and roadmaps, rather than simply reviewing past performance, when engaging with investors.
Overall, Lee concluded that enhancing corporate value has become a global trend. Taiwanese companies should move beyond short-term operational thinking, reassess long-term value from an investor’s perspective, and integrate ESG into core strategies. With transparent and effective communication, they can earn greater recognition and trust on the international stage.
By Reporter Li-Wen Chen (陳俐妏)
Source: https://reurl.cc/vLx7pA