Publicization of Corporate Governance Principles and Problems Identified

Because of the publicity and advantages of corporate governance principles, the annual Corporate Governance Conference held in Armenia for the fourth consecutive year to make business more viable. May 17, in partnership with the Corporate Governance Center and the U.S. Department of Commerce's Commercial Law Development Program and the International Private Enterprise Center.

This Year's Emphasis

"We organized the conference with another logic this year if in previous years we emphasized only the state of Armenia's corporate governance, talking about problems, seeking solutions together, this time we tried to communicate with our public with the experience of countries in advanced and compatible stages," said Narine Melissa, director of the Corporate Governance Center, in an interview with Banks.am, that partners in Central Asia and Eastern Europe who attended the conference also shared their experience.

He said the conference also contributed significantly to the conference by prominent international experts invited from CLDP, IFC, CIPE, ecoDa, INSEAD, and members of the board of local and foreign companies.

With countries in Eastern Europe and Central Asia, Armenia has almost the same problems and challenges, to inform businesses of the same topics that mainly lead to environmental, social, proper governance issues. Today these are trends, which is a concern that companies are not trying to change corporate culture or business thinking by taking care of their management system, but chasing fashion to emphasize that three Our approach is to manage environmental and social risks and opportunities by adopting the principles of proper governance as well." said Nerine Melissa.

According to the director of the facility, it is a major challenge to invite an annual conference in Armenia because there are not so many events in the corporate governance environment. "We try to hunt down the most significant problems in terms of ensuring the viability of the business community and present not only our experimental view but also global developments and ideas. Key topics of this year's conference are business welfare and corporate ethics, the promotion of principles of diversity and inclusivity in corporate relationships, and their advantages, and the role of the board of directors to lead cultural change. The business community's interest in the conference is growing year by year "Every year, new organizations participate in the conference, we host new speakers, there is a growing interest in our Center and its initiatives, especially the Business Welfare Club, and therefore expands our army of employees as well."

Addressing Problems Within a Year

Our Center deals with this issue throughout its work. The center has translated this year and presented the revised principles of G20/PEF corporate governance in 2023 in a separate conference. By the way, principles in two official languages (English, In general, the problems we have been dealing with and that have been eliminated by the participants of the Business Welfare Club need to be publicized at a certain time. "The conference aims to present the most substantial problems of corporate governance identified within a year to the broader public, including the business community," said the director of the Corporate Governance Center.

According to Constantine Saroyan, moderator of the Conference on the Secretary-General of the Euro-Asian Fund Banking Union, collective governance issues are present in many countries, of course, in Armenia as well.

After the collapse of the Soviet Union, market relations were formed, in the 1990s, somehow enriched people set up enterprises and began to manage them. But that phase has passed, we've now entered a more civilized phase of activity where stable governance is needed with a long-term cut. We need to develop principles of proper governance in companies and government institutions. "On the basis of contradictions when decisions are not made individually, because such decisions lead to long-term problems," said Constantine Saroyan.

The purpose of the conference, he said, is to focus on these problems and solutions that can be achieved in sustainable development, both in private companies and in the general economy.

"In our newly formed, emerging market economy, we often look at the development of any company or sector in terms of special governance. for example, if we take large companies, they're all likened to one person. When anti-crisis management or the stage of development when a company has just been created, perhaps that's acceptable, but when it reaches another stage where long-term sustainable development is to be provided, there needs to be collegial governance.

We have to bring the idea to the business community, "The biggest problem with us now is that they think about it, but they're afraid or don't know how to do it," said Constantine Saroyan.

Investing in business ethics principles

Luisa Ayvazyan, head of Armenia's office at the International Private Enterprise Center (CIPE), noted that their organization's main objective is to support democracy and strengthen the private sector.

Years ago, with our assistance, the Center established a business welfare club with more than 30 members. This is the first collective initiative of the business community in Armenia to promote the unified actions of Armenian businessmen on corporate governance issues. "The members of the club here receive professional support to improve their own administration, to introduce principles of anti-corruption compliance and well-being."

As for the changes that took place in this regard compared with last year, Luisa Ayvazyan noted: "The Anti-Corruption Strategy adopted by the Ministry of Justice and the 2023-2026 strategy adopted by the Ministry of Justice. The action plan, which has a special place in the private and business sector, contributes to modern solutions to full corporate governance compliance and the definition of rules of transparency for business in the country. Among the planned actions is the adoption of a corporate governance charter in Armenia."

Arpie Gilavian