THE MOST IMPORTANT EVENTS IN THE SOE SECTOR IN 2023
Let’s remember and review the most important events of the SOE sector in 2023.
in 2023 January 2 State enterprises Klaipėda State Seaport Directorate (KVJUD), Oro navigacija (ON) and Lithuanian Motorway Directorate (LAKD) were transformed into joint stock companies. The reorganization was carried out by implementing the Government program and the recommendations of the Organization for Economic Cooperation and Development (OECD) to revise, simplify and unify the legal forms of SOEs.
in 2023 January 3 The Agricultural Data Center started its activities, which was established after the reorganization of three state companies – JV Agricultural Information and Rural Business Center, Remote Research and Geoinformatics Center “GIS-Centras” and JV State Land Fund – taking over all rights and responsibilities of these companies .
in 2023 January 11 The government approved the amended plan of measures for the reorganization and centralization of management of SOEs, which provides for the initiation of procedures for the liquidation of UAB “Lietuvos kinas” and the procedures for the transformation of state enterprises – SOE “Valstybinė miško uredija”, SOE “Registrų centras”, SOE “Regitra” into joint stock companies; Reorganization of JV “Indėlių ir investičių draudimas” into a public institution. These transformations continue the implementation of the SOE management centralization plan, which was approved in 2021.
in 2023 February 15 UAB “Investicijų ir verslo garantijos” (“Invega”) has become the only state financial institution that provides business support, including companies that do not receive bank financing. With this action, another stage of the consolidation reform of the National Development Institutions (NDI) has been completed, with the help of which the National Development Fund will help to connect the strategic goals of the ministries, financial sources and financial market participants. According to the government’s decision, “Invega” is the only one with the status of NPI, and its subsidiaries have lost this status. The following is continued in 2022. In October, the Government started the consolidation of national development institutions. Consolidation is carried out by reorganizing UAB Agricultural Loan Guarantee Fund (ŽŪPGF) and UAB Public Investment Development Agency (VIPA) by connecting them to INVEGA and transferring to INVEGA most of the activities of UAB State Investment Management Agency (VIVA).
In 2023, the depoliticization and increase of independence of the collegial management and supervisory bodies of SOEs reached a new level: for the first time, the chairmen of all SOE boards and supervisory boards became independent. Independent and depoliticized SOE collegial bodies are one of the most important elements of efficient and transparent SOE governance. The share of independent members in the elected collegial bodies of SOEs increased to 65 percent. and this is consistent with OECD good governance practices.
in 2023 On June 21, UAB Construction Production Certification Center (SPSC) was handed over to Vilnius Gediminas Technical University (VGTU). Previously, the company was subordinated to the Ministry of Environment, and with this transfer, the last step in the transformation of this company was implemented. The entire SPSC reform process was carried out in accordance with OECD recommendations.
in 2023 the assessment of the implementation of SOE strategies carried out in July showed that the financial indicators to be achieved by every fourth SOE are not sufficiently ambitious. The geopolitical situation, the war in Ukraine, the energy resource price crisis, disruptions in the global supply chain – factors that have had a negative impact on the results of a considerable number of SOEs: only slightly more than half of SOEs – 58 percent. – properly implemented all the main indicators – long-term profitability, optimal capital structure and dividends and profit payments -. In total, 78.1 percent was fulfilled in 2022. financial indicators, non-financial – 85.7 percent.
in 2023 July 31 The government approved the updated plan of measures for the transformation and centralization of management of SOEs. It is planned that after the end of 2024, 31 companies will remain in the portfolio of SOEs – all joint stock companies or closed joint stock companies (there will no longer be companies with the legal status of a state enterprise (SOE).
In January-December 2023, new boards of 6 SOEs and 10 of their subsidiaries were formed.
in 2023 September 1 the state company Lithuanian Airports was transformed into a joint-stock company. This company was the last of the companies regulated by the Ministry of Transport to reorganize into a joint-stock company, so there are no longer any companies with the legal form of a joint-stock company in the field of transport.
October 11, 2023 The SOE Good Governance Index was presented. The most recent assessment conducted by the Management Coordination Center showed that the best management practices are implemented in the category of large companies by AB “Ignitis Grupė”, in the category of medium-sized companies by AB “Smiltynės perkėla”, and in the category of small companies by JV “Indėlių ir investičių draudimas”. When evaluating the achievements of companies in specific areas of good governance, special nominations are given. UAB “Toksika” was recognized as the leader in strategic planning and implementation, AB “Keliu bereža” won the award for the most professional board, and AB Lietuvos ouro uostai was awarded for management progress.
During the months of January – December 2023, 8 new general directors of SOEs were appointed. Current laws provide that the managers of these companies can serve no more than two 5-year terms in a row. The OECD recommends abandoning provisions that set limits on the number of terms of office of managers of state- or municipal-owned companies.
