The OECD has approved new Guidelines on Corporate Governance of
State-Owned Enterprises (pdf) to give concrete advice to countries on how to
manage more effectively their responsibilities as company owners.
The Guidelines aim to help make state-owned enterprises more competitive, efficient and transparent.
In many OECD countries the state remains an important owner of large
firms operating in key sectors, including energy, utilities and
infrastructure. But a recent OECD study reveals the challenges facing
such firms, including conflicting corporate objectives, unclear board
responsibilities and opaque appointment procedures.
To address these issues, the Guidelines call on governments to:
Ensure a level-playing field for state-owned enterprises competing with the private sector by
Clearly separating the state’s ownership role from its regulatory role
Allowing more flexibility in capital structures while making sure
that state-owned enterprises face competitive access to finance
Become more informed and active shareholders by
Simplifying the chain of accountability through centralising or
more effectively coordinating shareholding responsibilities within the
Reducing political interference in day-to-day management
Introducing a transparent nomination process for boards, based on competence and skills
Empower boards by
Clarifying their mandates and respecting their independence
Separating the role of Chairman and CEO and giving boards the power to appoint CEOs
Systematically monitoring the board’s performance
Improve transparency by
Strengthening internal controls
Carrying out independent, external audits based on international standards
Disclosing any financial assistance from the state
Producing aggregate performance reports
These Guidelines are based on and complementary to the OECD’s Principles of Corporate Governance,
created in 1999 and revised in 2004, that are the benchmark for
national codes of governance in members as well as non-member countries.