Implementation Of International Corporate Governance Standards In Russian Electric Power Industry

Abstract

The paper considers the implementation of international corporate governance standards in Russian power generation companies. The implementation is mainly determined by analyzing whether or not Russian companies comply with Russia’s Corporate Governance Code criteria that are based on these standards. An  in-depth analysis involves additional assessments. These are the assessment of Russian boards of directors by  Spencer Stuart; the Transparency International assessment of corporate reporting transparency in the largest Russian companies; the assessment of the Corporate Governance Index of Russia based on the Good Governance Index and an international methodology adapted to Russian contexts; and the assessment of how the elements of the international “soft law” are introduced. These additional assessments made it possible to consider the criteria that are not included in the Code; to compare corporate practice in the Russian power generation companies with other Russian companies and the largest companies in Europe, the United Kingdom and the United States; and to study independent opinions of professional and expert communities about the quality of corporate governance. The findings revealed that the overwhelming majority of Russian power generation companies do not meet the analyzed criteria that are significant for investors. This situation is indicative of weak implementation of international corporate governance standards in these companies and their low investment attractiveness.