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World Bank urges Ukraine to adhere to corporate governance procedure when appointing GTSOU head
KYIV. Aug 26 (Interfax-Ukraine) – The World Bank called on the Ukrainian authorities to adhere to the Organisation for Economic Co-operation and Development (OECD) corporate governance procedure when appointing the General Director of the Gas Transmission System Operator of Ukraine (GTSOU).
According to a World Bank letter to the Minister of Energy with a copy to the Ministry of Finance, the text of which is available to Interfax-Ukraine, the OECD principles of good corporate governance suggest that the appointment and selection of the CEO is the sole responsibility of the GTSOU Supervisory Board after its creation.
Therefore, they strongly recommend that all of these activities be carried out by an independent supervisory board of the Ukrainian GTS Operator after it is elected through a transparent and merit-based nomination and appointment procedure, the bank said.
In this regard, the World Bank proposed to organize a meeting of a group of its specialists with representatives of the Ministry of Energy, who are now developing an alternative new charter for the GTSOU, so as not to lose the due independence of the operator’s supervisory board.
This will ensure that the World Bank, as well as other development partners, can provide optimal support to Ukraine in its energy strategy and investments over the coming years, the letter says.
The Bank offered to send a mission to Ukraine for the week of September 4 to further discuss these issues and define its support broadly.
The World Bank recalled that its group has been working with the government of Ukraine for several years to strengthen corporate governance of state-owned enterprises in accordance with the OECD principles. In particular, the developed models for the GTSOU were approved by the Energy Community Secretariat and the European Union.
This approval and effective corporate governance of state-owned enterprises in the energy sector as a whole is fundamental to successful integration with European energy markets and Ukraine’s future energy security, the bank said.
