General information
Code: J7-7229
Period: 1.1.2016 - 31.12.2018
Range on year: 1.07 FTE | 2016
Project leader at FDV: prof.dr. Rado Bohinc
External project leader: UL FDV
Abstract
Slovenia is one of the EU countries most affected by the world financial and economic crisis. An important reason for this is demonstrated by the findings of the research project, entitled “Legal and Economic Aspects of Corporate Governance in the Public and Private Sector as a Tool for Overcoming Economic and Development Crisis” (project leader Prof. Rado Bohinc, PhD), which was conducted from 2011 to 2014, and was financed by the Slovenian Research Agency (ARRS). The project showed that poor corporate governance of state-owned enterprises (SOEs) is an important reason for Slovenia’s poor economic performance over the last years. Moreover, the European Commission in its Communication of 5 March 2014 draws attention to the excessive macroeconomic imbalances in Slovenia, and mentions the high level of state involvement in the economy and weak corporate governance, especially of SOEs, as risk factors. Similarly, the OECD in its reports from 2011, 2013 and 2015 concludes that poor corporate governance of SOEs is one of the main causes for the crisis in Slovenia. Hence, the proposed research project will focus on the contemporary challenges in the corporate governance of SOEs, especially in Slovenia, but also from the EU and OECD perspective.
The first part of the project will focus primarily on an in-depth analysis of the essential weaknesses, at the normative as well as the implementation level of SOE corporate governance activity in Slovenia. Good practices in the EU and OECD countries will be identified and analysed. The central focus will be on the OECD Guidelines on Corporate Governance of SOEs (Guidelines) as in 2014 – based on new findings from the ten years of experience with their (in)application in praxis – a revision procedure has been initiated and a new draft of the Guidelines has already been drawn up. The project will, among others, address the following issues: ensuring an effective legal and regulatory framework for SOEs (including the separation between the state’s regulatory and ownership function); the position and particularities of the state acting as an owner, equitable treatment of shareholders, transparency of business activities and disclosure, and the staffing, position and responsibilities of boards in SOEs.
With regard to the newest findings from the fields of legal and economic sciences, the second part of the project will take a thorough look at the rationales behind state ownership, state ownership policy, including sustainable business and socially responsible corporate governance, and the related social market economy for the 21st century. The demand that everybody can benefit from growth is one of the key emphases of the Commission’s strategy document “Europe 2020”, to which the state as a socially responsible owner can contribute considerably.
The third part of the project will provide concrete institutional solutions and social innovations taking into account the social reality and the specifics of post(transition) Slovenia, based not only on good foreign practices but also on bad local practices in the corporate governance of SOEs. The proposed solutions and innovations will not be based on the simplified and repeatedly ineffective mechanical transfer of legal institutions from one (well-functioning) social system to the Slovene context. In Slovenia and other comparable countries, soft law in the form of codes and recommendations does not have the same effect as in well-managed countries with a rich and successful tradition of the rule of law and market economy. It is significant that the draft of the revised Guidelines strongly emphasises that the same approach and recommendations are neither effective nor applicable in all (social) contexts. In this third part, suggestions will be put forward with respect to the corporate legislation by introducing the most advanced approaches for the corporate governance of companies, especially of SOEs.
The phases of the project and their realization
The first part of the project will focus primarily on an in depth analysis of the essential weaknesses, at the normative as well as the implementation level of SOE corporate governance activity in Slovenia. Good practices in the EU and OECD countries will be identified and analysed. The central focus will be on the OECD Guidelines on Corporate Governance of SOEs (Guidelines) as in 2014 – based on new findings from the ten years of experience with their (in) application in praxis – a revision procedure has been initiated and a new draft of the Guidelines has already been drawn up. The project will, among others, address the following issues: ensuring an effective legal and regulatory framework for SOEs (including the separation between the state’s regulatory and ownership function); the position and particularities of the state acting as an owner, equitable treatment of shareholders, transparency of business activities and disclosure, and the staffing, position and responsibilities of boards in SOEs.
With regard to the newest findings from the fields of legal and economic sciences, the second part of the project will take a thorough look at the rationales behind state ownership, state ownership policy, including sustainable business and socially responsible corporate governance, and the related social market economy for the 21 century. The demand that everybody can benefit from growth is one of the key emphases of the Commission’s strategy document “Europe 2020”, to which the state as a socially responsible owner can contribute considerably.
The third part of the project will provide concrete institutional solutions and social innovations taking into account the social reality and the specifics of post(transition) Slovenia, based not only on good foreign practices but also on bad local practices in the corporate governance of SOEs. The proposed solutions and innovations will not be based on the simplified and repeatedly ineffective mechanical transfer of legal institutions from one (well functioning) social system to the Slovene context. In Slovenia and other comparable countries, soft law in the form of codes and recommendations does not have the same effect as in well managed countries with a rich and successful tradition of the rule of law and market economy. It is significant that the draft of the revised Guidelines strongly emphasises that the same approach and recommendations are neither effective nor applicable in all (social) contexts. In this third part, suggestions will be put forward with respect to the corporate legislation by introducing the most advanced approaches for the corporate governance of companies, especially of SOEs.
Research Organisation
http://www.sicris.si/public/jqm/prj.aspx?lang=eng&opt=2&subopt=403&hits=1&id=9979&search_term=J7-7229
Researchers
http://www.sicris.si/public/jqm/prj.aspx?lang=eng&opt=2&subopt=402&hits=1&id=9979&search_term=J7-7229
Citations for bibliographic records
http://www.sicris.si/public/jqm/prj.aspx?lang=eng&opt=2&subopt=400&hits=1&id=9979&search_term=J7-7229
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