Ukrzaliznytsia, Ukrposhta, And Boryspil Airport To Have Independent Supervisory Boards For First Time

13 March 2017 16:01

The Cabinet of Ministers has approved the procedures for creating independent supervisory boards for strategic state-owned enterprises, including the Ukrainian Railways public joint-stock company (Ukrzaliznytsia), the Ukrposhta postal company, and the Boryspil international airport.

The government is hoping that this will practically eliminate the possibility of political interference in the operations of state enterprises and significantly reduce the risk of corruption.

Independent supervisory boards will formulate the strategies for development of state-owned companies, appoint their management, evaluate their operations, and select independent auditors to audit them.

“For the first time, we plan to create supervisory boards in Ukrposhta, Ukrgidroenergo, Ukrenergo, the Boryspil airport, and Ukrzaliznytsia,” First Deputy Minister of Economic Development and Trade Maksym Nefedov said.

Independent supervisory boards should be created in state unitary enterprises and companies in which the state owns 50% or more shares (stakes), had assets worth more than UAH 2 billion in the preceding year, and had net revenues of UAH 1.5 billion. In total, 41 state companies meet these criteria.

In other unitary companies and businesses, decisions on creation of supervisory boards will be made by the relevant state management agencies.

Creation of independent supervisory boards is stipulated in the law of Ukraine No. 1405, which was adopted by the parliament on 2 June 2016. This document is one of the main elements of the reform of management of state property.