The Czech Institute of Directors and Deloitte: How to govern state firms professionally
The CIoD and Deloitte have prepared methodological guidelines for the corporate governance of state-owned companies in line with the OECD. The OECD Guidelines on Corporate Governance of State-Owned Enterprises recommend methods of efficient and professional governance of these companies.
Prague, 5 October 2017 – The Czech Institute of Directors (CIoD) and Deloitte have worked together to prepare the expert Czech wording of the OECD Guidelines on Corporate Governance of State-Owned Enterprises. It is a set of rules that can help the state govern its companies more effectively. The document was published by the OECD in 2015 and now it is also available in Czech. This is the seventh language mutation of the publication, which was created based on the experience and comments of the OECD’s member states.
“At the beginning of this year, we managed together with the CIoD to introduce a new version of the G20/OECD Principles of Corporate Governance to the Czech Republic as the undisputable example and role model of corporate governance. The principles represent a basis of recommendations in the area of corporate governance, which is substantially complemented for state-owned entities by these OECD Methodological Guidelines, which the Principles refer to,” says Jan Spáčil, partner in charge of Deloitte Legal.
“For the first time in the Czech Republic, this document shows how to efficiently and professionally govern state-owned companies. It should be a guideline for everyone involved in creating ownership policies, strategies or instructions on how to manage and govern state-owned companies as well as for those who actually manage these companies in their complicated ownership structures. Compliance with these principles is voluntary but we do appeal to the state to require it from its companies,” says Monika Zahálková, CEO of the non-profit company CIoD.
The CIoD and Deloitte have been involved in corporate governance for a long time. They seek to bring an expert perspective on the rules of efficient and professional corporate governance that work in Western European countries. The new document follows the OECD Principles of Corporate Governance, which was presented by the companies in early 2017.
“The guidelines do not give specific instructions but they set goals, which consist in efficient running of state enterprises, their transparency and professionalisation of the state as the owner. It is necessary to ensure that any competition between state and private sector companies is fair and beneficial for the market,” Spáčil adds.
Primary rules of the Methodological Guidelines
- The state should let the administrative bodies of state-owned companies carry out their duties and responsibilities and it should respect their independence. All of this should be done under the condition of a transparent and responsible method of corporate governance with a high level of professionalism and efficiency.
- The employees of the owner entity or experts from other parts of state administration should be elected to the administrative bodies of state-owned companies only if they meet the qualification level required for all members of the administrative body and if they do not serve as intermediaries for political influence exceeding the ownership function.
About the Czech Institute of Directors:
The Czech Institute of Directors has been active in the field of corporate governance in the Czech Republic for almost 20 years and helps companies govern themselves – it helps company owners and shareholders decide who to entrust the company to, who to let govern it, but it also helps those who manage the company on a day-to-day basis, are in charge of generating profit and have legal, social and personal responsibility. More information can be found at www.ciod.cz.