The conflict over Ukrenergo: who really runs the state energy sector – the Cabinet of Ministers or foreigners?
11 June 13:11
ANALYSIS
Ukrenergo has been without a CEO for almost 9 months. And against the background of the process of appointing a new leader, the question of the broad powers of the company’s Supervisory Board, as defined by the Charter, has arisen. on May 19, the Ministry of Energy changed the Charter of Ukrenergo, which caused a strong reaction from a number of MPs and even threats from the EBRD to stop financing the company. "Komersant Ukrainian" found out why and whether there is a reason to expect a default of the strategic energy company of Ukraine from members of the Energy Committee of the Verkhovna Rada, MPs Oleksiy Kucherenko and Yuriy Kamelchuk.
According to Kucherenko, the problem lies in the corporate governance structure itself, which he considers to be inadequate and artificially imposed on Ukraine in 2016 under the guise of reforms.
“Ukrenergo is a strategic company that is fully owned by the state, and this stake is managed by the Ministry of Energy on behalf of the Cabinet of Ministers,” he emphasized.
MP Oleksiy Kucherenko
Kucherenko also believes that the state should have a decisive vote in appointing the management of such companies. Before the amendments to the Charter were made, he said, “the situation was absurd”: foreigners had a majority in the supervisory board, which could appoint the company’s chairman without the consent of government representatives. He is convinced that the Minister of Energy, as a shareholder, acted legally by demanding that at least one vote in the appointment of the head belong to a state representative.
“Four foreigners on the supervisory board could independently appoint the company’s CEO without any influence from the state, the owner. This is managerial nonsense,” Kucherenko said.
State property should have clear management responsibility, the politician emphasizes. And if the company showed 37 billion in losses last year, then society should know who to ask for such consequences.
Commenting on the EBRD’s statement criticizing the amendments to Ukrenergo’s Charter, Kucherenko added that creditors have no right to manage state infrastructure.
“Foreigners, as representatives of creditors, have every right to control how finances move. It is to control, not to manage,” he emphasized.
In turn, MP Yuriy Kamelchuk of the Verkhovna Rada Energy Committee suggests that the active discussion of changes to Ukrenergo’s charter may be related to the approaching appointment of a new CEO. He adds thatregardless of the position of international partners, Ukraine must maintain control over the management of its own assets.
“I think that the escalation of this topic may be connected with the possible appointment of the head of Ukrenergo. Regarding limiting the influence of international donors, no matter what agreements there are, we are a sovereign country, we have to manage our assets independently,” he said.
Changes to the charters
on May 19, the Ministry of Energy amended the charters of GTSOU and Ukrenergo, which means that four out of five members of the Supervisory Board (three are independent) must vote for the head of GTSOU and five out of seven (four are independent) must vote for the head of Ukrenergo.
On June 6, Minister of Energy of Ukraine Herman Halushchenko explained the amendments to the charters in the Verkhovna Rada as follows:
“I believe that these changes are actually aimed at something else: to ensure the independence of the supervisory board as much as possible and to ensure the possibility of working of the respective managers and board members as much as possible in order to protect them by a majority vote from dismissal or other decisions,” he said.
EBRD and threats of default
The European Bank for Reconstruction and Development, responding to changes in the charters of Ukrainian companies, said it has the right to suspend disbursement of loans and demand early repayment of loans already granted.
“We also note the Bank’s right, as provided for in the relevant Loan Agreements, to suspend disbursements and send the necessary notices for early repayment of loans if the Articles of Association have been amended, suspended, revoked, withdrawn or revoked,” the EBRD said in a statement.
