2.4.1.
The existing governance model at public sector entities is ineffective, resulting in losses and corruption
General information about the problem
The state ownership policy has not been formalized, and there are no individual ownership policies for state unitary enterprises and business companies in which the state owns 50 percent or more of the shares or equity (hereinafter in problem 2.4.1 – state-owned enterprises). In practice, the functions of the owner, regulator and policy-maker are not segregated at some agencies, which leads to conflicts between these functions.
The criteria for mandatory annual independent audits at state-owned enterprises are not defined, and the criteria for mandatory establishment of independent supervisory boards need to be updated. The legislatively defined principles for the formation and operation of supervisory boards of state-owned enterprises need to be aligned with OECD standards. In practice, there is a nominal independence of supervisory boards of state-owned enterprises from the owner, which makes it more difficult to create a model of transparent and productive management of the public sector of the economy.
OECD corporate governance standards have not been implemented at the vast majority of state-owned enterprises, particularly those of strategic importance for the nation’s economy and security or those with the highest level of corruption risks or enterprises that are the most critical business entities in the defense industry.
At the legislative level, there is a need to clearly define the requirements for the introduction of efficient and effective internal control and risk management systems in the operations of state-owned enterprises, the correlation between internal control and corruption risk management, and the powers of supervisory boards to exercise internal control.
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Implementation of SACP measures within the limits of the problem
The total number of OSR –
6
All measures of the SACP
measures, the implementation of which as of
30.06.2025
is about to begin
to be completed
5| 22.7%3| 13.6%3| 13.6%8| 36.4%3| 13.6%
22
ImplementedPartially implementedIn progressNot implementedNot started
Measures implemented (fully and partially) - 8 (36.4%)
Deadlines for all measures
01.03.2023 -
31.12.2025
Implementation of SACP measures within the scope of the Problem by main main performers
Ministry of Economy, Environment and Agriculture of Ukraine
40%
15
Authorized management bodies
0%
3
State authorities — subjects of management of state-owned objects
0%
2
National Agency on Corruption Prevention
100%
2
Achievement of ESR within the limits of the Problem
The total number of OSR – 6
Qualitative level of achievement of ESR
0.0% High
116.7% Middle
583.3% Low
Average evaluation of achievement of ESR, %:
SUMMARIZED GENERAL INFORMATION ON THE IMPLEMENTATION OF THE PROGRAM MEASURES IN TERMS OF DIRECTIONS, PROBLEMS AND EXPECTED STRATEGIC RESULTS
№
Name of the ESR
Name of the measure
The main implementer
Monitoring results (latest)
Performance note
% виконаних заходів (fully and partially)
ESR achievement level
1.1.
ESR 2.4.1.1 The principles of state ownership policy approved by the Cabinet of Ministers of Ukraine are periodically updated and consistently implemented in practice by entities that perform the functions of the owner of public sector entities
ESR 2.4.1.2 The functions of the owner, the regulator, and the agency shaping the policy applicable to business entities in the public sector of the economy have been segregated
Ministry of Economy, Environment and Agriculture of Ukraine
There is no progress in the implementation of the measure
In progress
3.4.
ESR 2.4.1.3 An annual independent audit of public sector entities of strategic importance for the economy and security of the state was introduced; the criteria for mandatory independent audit and the establishment of supervisory boards in public sector entities, including taking into account the level of corruption risks and the level of corruption in the sector, are periodically reviewed
Ministry of Economy, Environment and Agriculture of Ukraine
Implementation of the measure has started on time
In progress
4.1.
ESR 2.4.1.4 At all business entities for which the establishment of supervisory boards is mandatory, such boards are empowered to control the implementation of internal anticorruption measures. Supervisory boards are formed in a competitive and transparent manner
State authorities — subjects of management of state-owned objects
Implementation of the measure was started late
In progress
5.1.
ESR 2.4.1.5 Corporate governance standards have been introduced at public sector entities that are of strategic importance for the national economy and security or have the highest level of corruption risks, or are among the most important business entities in the defense industry (in particular, the right to terminate the contract with managers who violate anticorruption legislation or rules of ethical conduct has been established)