Corporate Governance Initiative Market economy calls for certain changes in the management of recent state owned enterprises. The managers of companies privatized during the first round of mass privatization had to define new governance models coping with the change in ownership structure and protecting shareholder rights. One of the core targets laid down in the economic policy of the government is to improve enterprise management in the process of restructuring, accountability, accountability and control systems. The lack of information and ongoing privatization combined with restructuring requirements became the driving forces behind the Center for the Study of Democracy's decision to institute a long-term program to promote core principles of corporate governance in Bulgaria. Corporate Governance Initiative The Corporate Governance Initiative for Bulgaria (CGI) is a coalition of Bulgarian non-governmental organizations established in 1999 by the following organizations: Association of Industrial Capital, Association of Private Pension Funds, Bulgarian Association of Licensed Investment Intermediaries, Center for Economic Development, Center for the Study of Democracy, Investors’ Union, and the Securities Holders Association. The main objective of the CGI is to facilitate the adoption of relevant corporate governance standards and procedures that would ensure accountability and transparency in business operations in Bulgaria and Central and Eastern Europe.
Building on the achievements of CGI in 1999 the main objective of the activities in 2000 is to develop policy measures and adopt a relevant policy agenda for corporate governance development on a broader regional level in CEE transition context. Through country assessments, policy formulation, and wide dissemination and advocacy the Initiative will:
- Assist the elaboration and the implementation of set of practical and policy instruments that would ensure accountability, transparency and sound business practice in transition economies;
- Promote public awareness of best corporate governance standards and their practical importance for the economic growth and social progress of a country and international trade and investment development.
- Set up a framework for policy dialogue between private and public sector institutions aiming at introducing modern corporate governance structures and procedures in Central and Eastern Europe.
Main CGI activities in 2000
Corporate Governance Assessment Report The Corporate Governance Assessment Report (CGAR) will analyze the development in the following problem areas: Board Structure; Voting Rights; Disclosure and Transparency. In the process of elaborating the set of indicators internationally recognized instruments and documents will serve as starting point. CGI proposes to design a system of indicators that will measure corporate governance developments in Bulgaria and allow for international comparisons across transition economies. Corporate Governance Guidelines for Bulgaria The document to be developed - Corporate Governance Guidelines for Bulgaria - will be based on CGAR and 1999 CGI Policy Recommendation Paper but will further elaborate its most topical action lines: Responsibilities and Motivation of Boards; Role of the Judiciary and Improvement of Judicial Practice; Promotion of Capital Market Development and the Role of Institutional Investors; Residual State Shareholding. Policy Workshop The Policy Workshop will bring together approx. 40 participants at the expert level (government agencies representatives, investment industry experts, business associations and self-regulatory organizations, international donors). It will be the main public event at which the CGAR and CGG will be presented to the broader public. Regional Corporate Governance Forum The Regional Corporate Governance Policy Forum will be the first event in the region to bring together policy makers, governance experts from NGOs, investors and shareholders associations’ representatives as well as several international organizations. The forum will encourage private and public sector efforts to develop corporate governance structures and procedures to manage companies in an accountable and transparent manner, to monitor performance and to attract investment to the region. The purpose of the Regional Policy Forum is to: (a) explore the shifting pattern of corporate ownership and control arrangements in transition economies;
(b) attempt to map these trends as well as corresponding changes in corporate behaviour and analyse them from a comparative corporate governance perspective;
(c) to discuss different policy options for the adoption of modern corporate governance principles as means for transition economies to overcome obstacles on the way to higher competitiveness on the global market.
Organization The Steering Committee provides the coordination of CGI activities and outputs. It meets regularly, approximately every four-to-six weeks. The Committee is formed by the representatives of the CGI founding organizations together with representatives of Bulgarian Stock Exchange-Sofia, Council of Ministers, Ministry of Economy, Securities and Exchange Commission and business community. For the purpose of providing permanent support to the work of the Steering Committee, a CGI Secretariat is being set up at the CSD. The CGI Secretariat provides the day-to-day operational management, logistical support and reporting for the CGI activities. For more information:
Dr.Maria Prohaska
Coordinator, Economic Program
Center for the Study of Democracy
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