Эссе на тему: "Discuss the major issues in corporate governance in Russia"

The major issues in Corporate Governance in Russia, the UK and Ireland and ways of their development
Corporate governance in the UK and Ireland has similarities which are manifested in the fact that it is subject to more regulatory acts rather than to the legislation acts. Corporate governance is subjected to the action of codes and not just to the legal norms. Auditors must make a report if they did not record the data, which distort financial reality.
There are such problems in corporate governance in the UK:
shareholders pursue purely their own goals;
directors of the leading companies in the country act in their own interests;
there is a predominance of Executive Directors in companies;
- non - Executive Directors have a weak position and cannot independently make decisions;
- a country has poor accounting standards and inadequate monitoring;
- a stock market does not always work effectively.
Corporate governance in the UK is based on Cadbury, Greenbury, Hampel Reports, the Turnbull Committee Guidance, the Smith Group Guidance and the Higgs Report.
All the UK companies operate under a Combined Code. The Code prescribes that all the directors were elected each year. Assessment of the activities of the Board of Directors should be performed every 3 years. The appointment to the senior positions in the companies has to deal with gender issues. The Board of Directors is responsible for risk appetite.
Until 2010 the Combined code of corporate governance was acted in Ireland. 29 companies in Ireland are listed on the ISE website. The methodology of the corporate governance in Ireland provides for the consideration of the annual reports, a review of websites and interviews with the directors of the companies. The implementation of the corporate governance should rely on the annual reports of the companies, not websites, as the information on them is not so actual.
Corporate governance in Ireland is characterized by the fact that the director acts as a trustee for shareholders and responsible to other stakeholders. The main direction of improving corporate governance in these countries is to improve the disclosure of information and its availability for inspection by independent auditors.
Currently the main issues related to corporate governance in Ireland and in the UK are investigating the situation surrounding Anglo-Irish Bank and to studies of major insolvent companies. The main problems of corporate governance relate to the transactions of directors that violate the terms of the loans. Auditors in these countries do not have the sufficient qualifications. Companies in these countries do not follow the rules of accounting and do not respect the rights of shareholders.
Regulation of corporate governance in Ireland is performed by a specially created Irish Auditing and Accounting Supervisory Authority. The organization aims concerning a support and strengthen a public confidence in profession of an accountant and in financial reporting through the implementation of independent oversight and the promotion of high standards.
All companies in the UK operate on the basis of the Corporate Governance Code. The code establishes the principles of the companies' activities in the field of the corporate governance. All the companies must report in their corporate reports about how they comply with the Code. If for some reason certain provisions of the Code are not met, the company should disclose why it happened. Oversight of the companies is performed by the Financial Reporting Council. The financial crisis of 2008 has forced to reconsider some of the provisions of corporate governance due to the collapse of several banks in the UK. Since 2010 the country has a new Corporate Governance Code.
Corporate governance in the Russian Federation is based on Anglo-Saxon and the European models. Regulation of the corporate governance started in 1995 in the country with the adoption of the Federal law "About joint stock companies". The Federal Commission on securities and stock market has developed a number of corporate governance standards. These standards stipulate the participation of shareholders in decision-making, equality, the role of the Board of Directors in strategic development of the company.
Russia is a country in transition. The company whose shares are traded on exchanges used a mixed continental form of corporate governance. The mechanism of corporate governance is that the whole company is driven on the basis of the relationships. In transition economies which include Russia corporate governance is weak. The disadvantages of corporate governance are its opacity and the insecurity of ownership. The level of corporate governance (under World Bank data) in Russia is at 151 out of 208 presented in the ranking of countries. This is a very weak position.
Underdeveloped support institutions are very weak in Russia. The independent auditing, accounting services, the law and the arbitration are not developed in the country.
The interests of the minority shareholders are not protected. The decision about the investment company takes on the basis of the votes of the decision makers, not on economic analysis of the market.
Russian companies are not interested in improving the corporate governance because of discrediting the idea of public offering of shares. In the Russian companies there is a risk of excessive external borrowing amounts and accumulation of external debt. It has affected a minority of shareholders, which was deprived of payments due to non-compliant of their rights of property distribution. The main shareholders withdrew from participation in the management, so the use of the internal control mechanisms of corporate governance became unnecessary. The Russian company will receive the key to the confrontation of crises if they pay more attention to enterprise risk management. The most stable source of development in these conditions is to attract foreign direct investment. This will contribute to the internationalization of Russian companies. Foreign direct investment will be available only to those companies which conduct their activities transparently, when they will be open to the public and will ready for international audit.
All the companies are exposed to the risks up to this point cannot be prevented. All the companies are risk of loss of income due to the crises and to the internal fraud. The overall approach to the improvement of corporate governance should be the principles of the world's Corporate Ethics that would be respected by the world leading companies. The company which does not respect these principles will be deemed to have lost his reputation. The creation of a common website for reporting of all the companies needed who wish to join the global Corporate Code of ethics.