CURRENT PROJECTS
Azerbaijan Corporate Governance Project
Central Asia Corporate Governance Project
Georgia Corporate Governance Project
COMPLETED PROJECTS
Russia Corporate Governance Project
Russia Banking Sector Corporate Governance Project
Ukraine Corporate Governance Project
Ukraine Banking Corporate Governance Project
Ukraine Corporate Development Project
THE CHALLENGE
The countries of Eastern Europe and Central Asia have had different experiences in their transitions to market economies, but all have faced a common challenge: attracting foreign investment.
The low level of corporate governance in most countries in the region is a serious obstacle for potential investors. Many companies operate without sufficient internal controls or external regulation, and an inadequate legal framework means that minority shareholders are poorly protected by the law. In this environment, outside companies have been wary of investing in the region.
THE IFC APPROACH
IFC’s corporate governance projects take a programmatic approach to reform:
with companies: IFC provides in-depth consultations to pilot companies and conducts workshops and public seminars that reach a wider audience. We also create model documents such as charters and bylaws that conform to international standards. More than 600 companies have reported improved operations due to their participation with IFC projects;
with governments: IFC has advised governments on over 50 legislative acts or regulations. Our projects have worked with Securities Commissions and national stock exchanges on corporate governance codes and listing requirements, to enforce greater corporate governance standards from the regulatory level;
with universities, media, and the public: IFC has trained professors and introduced corporate governance topics to the curricula of over 75
universities to educate future managers and policymakers. Projects also provide training for journalists to educate them on proper reporting of the issues.
ACHIEVEMENTS TO DATE as of July 1, 2007
IFC’s corporate governance projects in Eastern Europe and Central Asia have had notable successes:
Increased investment. By working with IFC’s corporate governance projects, companies and banks have been able to access more than $2.5 billion in additional investment that they’ve attributed to their improved corporate governance practices.
Greater transparency. In Ukraine, we helped implement beneficial ownership disclosure in annual reports (the first time this kind of information was disclosed in the country), and assisted partner banks to create the post of an Independent Director on their Supervisory Boards. We’ve developed corporate documents to international standards, including charters and bylaws, which have been adopted by more than 600 banks and companies in the region. IFC has helped the National Securities Commission of Georgia to develop and adopt a set of IFRS-compliant financial forms now used by 87% of joint-stock companies in the country.
Improved legislation. Our projects have helped to pass 29 laws or regulations by working with national governments. We helped the Russian Securities Market Regulator to draft and distribute Russia’s first national corporate governance code as well as the Ukrainian Corporate Governance Principles, a guiding document for corporate governance practices in Ukraine.
Better understanding of corporate governance.
We have provided consultations and trainings to more than 8,300 companies and banks in Eastern Europe and Central Asia, including almost half of all operating joint-stock companies in Georgia. A broad public education campaign has resulted in nearly 1000 media appearances for IFC and more than 305,000 copies of projects’ materials disseminated.
DISSEMINATING THESE EXPERIENCES
Since beginning in Eastern Europe and Central Asia, corporate governance has become a key product of IFC Advisory Services, and is now headed by a joint IFC-World Bank department. With this depth of expertise and experience, IFC is replicating its corporate governance work into new countries and new regions, expanding from Kazakhstan into Kyrgyz Republic and Tajikistan, and has launched new programs in Egypt, Vietnam, and China. Our existing corporate governance projects in this region will begin to focus on more advanced topics, such as internal audit and risk management, ensuring that developing markets will continue to strive to reach international best practices.
CONTACT INFO
IFC Advisory Services in Eastern Europe & Central Asia
Motria Onyschuk-Morozov
Senior Operations Manager,
Corporate Governance
30a Spaska Street
Podil Plaza, Block 2, 6th floor
Kyiv, 04070, Ukraine
Tel: +38 (044) 490-6400
Fax: +38 (044) 490-6420
International Finance Corporation
Corporate Governance and Financial Markets Dept.
Darrin R. Hartzler
Senior Corporate Governance Officer
2121 Pennsylvania Avenue, NW
Washington, DC 20433, USA
Tel: +1 (202) 473-0027
Fax: +1 (202) 522-1604
