MOSCOW: Abuse of shareholders by managers and majority owners cripples foreign investment in Russia. No surprise, then, that improving corporate governance and protecting minority shareholders is becoming a concern of the Putin government. Refusing shareholders entry to shareholders meetings, or striking their names off share registers – two popular gimmicks of a few years ago – are rarer nowadays. Some “oligarchs” have undergone Damascene conversions and are trying to improve their image among investors. A few companies, such as the oil giant Yukos, even appoint independent directors from abroad. These private sector improvements, however, are nowhere to be seen among large businesses controlled by Government, even though many of these firms have a substantial minority of private shareholders who need protection from managerial abuse. Management in these firms, indeed, has become more arrogant and inventive in violating shareholder rights. As an independent member of the boards of electricity utility RAO UES and the gas giant Gazprom, I know directly of their waywardness.
MOSCOW: Abuse of shareholders by managers and majority owners cripples foreign investment in Russia. No surprise, then, that improving corporate governance and protecting minority shareholders is becoming a concern of the Putin government. Refusing shareholders entry to shareholders meetings, or striking their names off share registers – two popular gimmicks of a few years ago – are rarer nowadays. Some “oligarchs” have undergone Damascene conversions and are trying to improve their image among investors. A few companies, such as the oil giant Yukos, even appoint independent directors from abroad. These private sector improvements, however, are nowhere to be seen among large businesses controlled by Government, even though many of these firms have a substantial minority of private shareholders who need protection from managerial abuse. Management in these firms, indeed, has become more arrogant and inventive in violating shareholder rights. As an independent member of the boards of electricity utility RAO UES and the gas giant Gazprom, I know directly of their waywardness.