Implementation of corporate governance in Ukraine lags behind, rollback seen in some issues – World Bank

KYIV. Sept 13 (Interfax-Ukraine) – The implementation of corporate governance in Ukraine is lagging behind and in some issues a rollback has been seen, World Bank Vice President for Europe and Central Asia Anna Bjerde has said.

In recent years, significant progress has been made in adopting legislation and strengthening systems that regulate the activities of state-owned enterprises. At the same time, the introduction of corporate governance practices is lagging behind, where there has even been a rollback in certain issues, she said in an exclusive interview with Interfax-Ukraine.

Bjerde gave an example: only nine state-owned enterprises have supervisory boards designated under the new regulations.

The right to manage and supervise state-owned enterprises remains dispersed among 96 ministries and departments, which complicates the further implementation of the reform. As a result, state-owned enterprises continue to operate in conditions of excessive political influence, non-competitive practices in choosing key management positions, senior staff and ineffective mechanisms of control and accountability, the vice president of the World Bank added.

She stressed the importance of non-interference in the performance of management functions by supervisory boards of state-owned enterprises and their members. According to her, the improvement of corporate governance in Ukraine requires the adoption of a new law on corporate governance at state-owned enterprises and its implementation in practice.

The World Bank also called on the National Bank of Ukraine to maintain its role as an independent supervisor over the banking sector, Bjerde said.