Transformation of corporate governance in the Russia’s electric power industry

Abstract

To make Russia' electric power industry more appealing for investors, in the course of its reformation its generating assets were privatized with international corporate governance principles adopted. One of the key reasons that hinder the solution of the above problem is the transformation of corporate governance. The results of the assessment of power generating companies' compliance with the Corporate Governance Code in 2017–2018 are presented. The assessment was conducted using the Bank of Russia methodology. An additional analysis of information on general corporate governance practices as retrieved from the official websites of these companies was performed. We took into account the findings of the research published in this area as carried out at St. Petersburg State University, the New Economic School, the Russian Institute of Directors, the Platforma Center for Social Engineering, the MGIMO University, the Independent Directors Association and the HSE University. The key aspects of corporate governance transformation in the Russia's electric power industry were identified by summarizing the data thus obtained. They were primarily limited to claiming a formal approach adopted by majority owners so as to comply with international corporate governance standards in the process of permanent redistribution of ownership and increasing its concentration.