At a time when some Ukrainian businesses are scaling back, Asnova Holding—a closely-held company based in Kiev and supported by an initial $8 million IFC investment—is earning a solid reputation for good corporate governance that is helping it find new investors to expand its activities in wholesale cosmetics and consumer goods.
Asnova started as a small enterprise organized by a group of friends. It is now Ukraine’s biggest distributor of well-known global consumer products, and one of the country’s biggest players in logistics, warehousing, and wholesale cosmetics. Asnova CEO Urfan Guliyev says that adopting good corporate governance practices has improved the company’s operations and heightened its appeal to investors. “It makes the company more understandable to them, and decision-making is clearer,” he says. “As a result, the market value of the company will be higher.”
Companies looking to invest in Asnova say they are motivated by its growing reputation for sound corporate governance. Olena Globa, the corporate secretary, says the training she received from Canada and Switzerland-sponsored IFC Advisory Services on corporate governance has enabled her to clearly define decisions and roles within the company that contribute to its productivity.
With new investments, Asnova is more than tripling the size of its warehouse to handle the huge increase in activities, which is expected to produce many new jobs. Asnova is also better positioned to weather the financial crisis. “Thanks to improved corporate governance, we signed a number of joint ventures with international partners a couple of years ago, and now it’s clear that being in those joint ventures will make it easier for us to cope with this financial crisis,” says Guliyev.
Asnova is now in line to receive an additional $12 million IFC investment.
IFC’s corporate governance advisory services assist clients to adopt sound corporate governance practices, to help strengthen their operations, improve performance, and provide greater access to financing.
