Chile's equity market is fairlylarge and successful. The market capitalization of the 249listed firms represented 89 percent of GDP at year-end,2001. Corporate ownership is concentrated and pyramidstructures are common. Business groups/conglomerates are thepredominant corporate form. Institutional investors,especially pension funds, are active equity investors. TheSecurities Market Law and the Corporation Law form the legalframework governing the capital markets. The securitiesmarket is regulated by the Superintendence of Securities andInsurance (SVS). Overall, Chile scores well on theassessment on compliance with the OECD Principles, scoring"Observed" or "Largely Observed" for 14of 23 Principles; no Principle is deemed "NotObserved." The policy recommendations may be groupedunder three broad categories: legislative reform,institutional strengthening and voluntary/privateinitiatives. The report recommends further amendingCorporation Law and Securities Market Law to increasetransparency for investors; having more transparency in andaccountability of the SVS; increasing resources for the SVSto strengthen its ability to conduct market surveillance;and preparing a road map to improve the general enforcementof investor property rights. Finally, the report proposescreating an Institute of Directors to provide training forsupervisory board members, disseminate best practice, andpromote dialogue between the public and private sectors.
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