Page 40 - bne_Magazine_October_2017

40 I Eastern Europe bne October 2017
Donors are raising concerns over the government’s commitment to cleaning up corruption in big state-owned enterprises.
Directors resign from board of Ukraine's gas monopoly over derailed reforms
Sergei Kuznetsov in Kyiv
The two surviving independent members of the supervisory board at Ukraine's gas monopoly Naf- togaz - Paul Warwick and Marcus Richards – quit on September 19, citing "the government’s lack of commitment to duly implement the corporate gov- ernance reform", the company said in a statement. The other independent direc- tors have all already quit, raising con- cerns by donors over the government’s commitment to cleaning up corruption in big state-owned enterprises.
According to a letter signed by Warwick and Richards, they made it "very clear" to the Ukrainian government in April that their continuing involvement in this critical reform project was contingent on material progress on corporate governance.
www.bne.eu
"Despite assurances from senior politicians, deadlines have passed and commitments have not been delivered with an environment of government control, not envisaged in the corporate governance action plan," the letter reads. "Increasing political meddling becoming increasingly evident and, unfortunately, the norm. Essentially, no material change has occurred over the last five months despite the assurances we received to the contrary."
In April, the four independent board members – Paul Warwick, Markus Richards, Charles Proctor and
Yulia Kovaliv – sent a letter to the Ukrainian government indicating their concerns over the situation in the company. Without material progress it would be "inappropriate and untenable"
for them to continue as supervisory members, they said in the letter.
Specifically, the independent board members demand the "resolution of issues" related to the electronic decla- rations system of Ukrainian officials. According to recent amendments to Ukrainian legislation, financial disclo- sure obligations have been extended
to existing and potential members of supervisory boards of state-owned com- panies. "It is impossible for foreigners to complete necessary actions with such inaction leading to potential criminal claims against us," the independent board members wrote.
The European Bank for Reconstruc- tion and Development (EBRD), Naf- togaz's main international partner and