By the Resolution of the Cabinet of Ministers dated March 29, 2021 No. 166, the Strategy for Management and Reform of Enterprises with State Participation and targets for its implementation in 2021–2025 were approved.
The strategy includes the following main directions:
- further improvement of legislation, providing for the unification of legal regulations for the management and privatization of state property into an act of direct action by means of their optimization, systematization and unification;
- preventing the creation of business entities and state unitary enterprises with a state share of 50% or more in the authorized capital without sufficient grounds, as well as granting them exclusive privileges and advantages over other enterprises;
- limiting state participation in areas where the private sector is successful and competitive, widespread implementation of the “sell or explain” principle;
- ensuring the complete transition of state-owned enterprises to market conditions, full implementation of modern methods of corporate governance in their activities;
- assessment of the performance of the executive body in terms of performance indicators, and the activities of the supervisory board – depending on the degree of implementation of the principles of corporate governance;
- disclosure of information on the activities of enterprises with state participation, ensuring transparency and disclosure of information in the management of enterprises.
First of all, the established rules of the strategy will be applied to large companies included in Appendices No. 1 and No. 2 of Presidential Decree No. UP-6096 dated October 27, 2020 “On measures to accelerate the reform of enterprises with the participation of the state and the privatization of state assets.”
Within the target indicators of the Strategy:
- the number of enterprises with state participation will be reduced by 75 percent:
- shares of at least 20 enterprises with state participation will be offered in primary and secondary placement;
- The number of independent members on the supervisory boards of enterprises with state participation will reach 30 percent by 2025.
From January 1, 2022:
- the special right of the state to participate in the management of individual joint-stock companies in the strategic industry is abolished;
- the powers of the members of the executive body and the supervisory board are extended from 1 year to 3 years;
- The practice of selecting candidates for members of the supervisory council of enterprises with state participation according to the state share is being introduced step by step.
In accordance with the Strategy, the approval with the Cabinet of Ministers of candidates for the management and members of the executive body of enterprises with the participation of the state, as well as the practice of simultaneously holding the positions of the head (member) of the executive body of enterprises with the participation of the state, is canceled.