Minister of Industry and Trade Tran Tuan Anh speaks at the session (Source: VNA) Hanoi (VNA) - Lawmakers stressed the need to clearly define State management andcorporate governance in businesses during the ongoing fifth session of the 14th-tenure National Assembly on May 28.
The discussion session focused on the implementation ofpolicies and laws on State capital and asset management and use in State-owned enterprises(SOEs) and equitisation of SOEs in the 2011-2016 period.
Accordingto NA deputies, ministries are still slow in separating State ownerrepresentative function and State management function, while inspection,examination and supervision of SOEs remains ineffective,leading to violations in the management and use of State property.
Some argued that ministries and sectors do not want to leave businesses thatare considered their "backyards", stating that this is amanifestation of group interests or a cause that leads to interest groups.
Statemanagement agencies at the same time perform the two functions so thatconflicts of interest may arise between policy assurance and implementation andsupervision, they said, adding that the method of monitoring and evaluation ismainly based on statistic reports of SOEs rather than those on the performanceof owners' objectives.
Ministerof Industry and Trade Tran Tuan Anh in his explanations on State management andownership over SOEs in recent times pointed out that the process has divided intotwo phases.
Accordingly, in 2011-2012, the implementation of State ownership and managementfor SOEs was governed by the 2003 Law on SOEs, the 2005 Law on Enterprises anda number of subordinate documents. Therefore, the supervision of financialperformance of SOEs, representatives of the State-owned capital of businesses wasthe responsibility of the Ministry of Finance.
The2013-2016 period witnessed changes in the institution, he said, noting that theLaw on Enterprises in 2014, the Law on State capital management and use forinvesting in production and business in SOEs and other documents stipulated themanagement of SOEs and the performance of ownership function in SOEs.
Heaffirmed that in the past time, in recent times,SOEs, including enterprises of the industry and trade sector, have contributedto ensuring assigned objectives and political tasks.
Agreeing with the NA’s supervision report, he said there have remainedshortcomings in the management of State capital and State capital ownership representativesin SOEs, including both objective and subjective factors.
He mentioned the fact that conflicts in the institutional system and legaldocuments have made SOEs’ operation more difficult, adding that the overlap betweenthe State management function and corporate governance role has made SOEs lessactive and caused the responsibility dodge among business leaders.
Theoverlapping management also causes deliberate wrongdoings and violations in implementinginvestment projects.
Among12 loss-making and ineffective projects reported by the industry and trade sector to the NA recently, many reflect thereal situation of capital management and corporate governance, he noted,stressing that not only heads of these enterprises but also managers of relevantministries and agencies must be responsible for those, including criminalliability.
Expressing his sympathy with solutions stated in the NA’s monitoring report, hesaid it is necessary to accelerate the completion of institution and legalframework for the State Capital Management Committee.
Inthe coming time, the industry and trade sector will continue to closelycoordinate with ministries and sectors to implement the State's directions,especially in improving the management mechanism and clearly defining the Statemanagement and corporate governance; bettering the legal framework to ensuresustainable economic development, and promoting integration so that State-ownedand private businesses can take advantage of market opportunities, the ministeraffirmed.-VNA
The discussion session focused on the implementation ofpolicies and laws on State capital and asset management and use in State-owned enterprises(SOEs) and equitisation of SOEs in the 2011-2016 period.
Accordingto NA deputies, ministries are still slow in separating State ownerrepresentative function and State management function, while inspection,examination and supervision of SOEs remains ineffective,leading to violations in the management and use of State property.
Some argued that ministries and sectors do not want to leave businesses thatare considered their "backyards", stating that this is amanifestation of group interests or a cause that leads to interest groups.
Statemanagement agencies at the same time perform the two functions so thatconflicts of interest may arise between policy assurance and implementation andsupervision, they said, adding that the method of monitoring and evaluation ismainly based on statistic reports of SOEs rather than those on the performanceof owners' objectives.
Ministerof Industry and Trade Tran Tuan Anh in his explanations on State management andownership over SOEs in recent times pointed out that the process has divided intotwo phases.
Accordingly, in 2011-2012, the implementation of State ownership and managementfor SOEs was governed by the 2003 Law on SOEs, the 2005 Law on Enterprises anda number of subordinate documents. Therefore, the supervision of financialperformance of SOEs, representatives of the State-owned capital of businesses wasthe responsibility of the Ministry of Finance.
The2013-2016 period witnessed changes in the institution, he said, noting that theLaw on Enterprises in 2014, the Law on State capital management and use forinvesting in production and business in SOEs and other documents stipulated themanagement of SOEs and the performance of ownership function in SOEs.
Heaffirmed that in the past time, in recent times,SOEs, including enterprises of the industry and trade sector, have contributedto ensuring assigned objectives and political tasks.
Agreeing with the NA’s supervision report, he said there have remainedshortcomings in the management of State capital and State capital ownership representativesin SOEs, including both objective and subjective factors.
He mentioned the fact that conflicts in the institutional system and legaldocuments have made SOEs’ operation more difficult, adding that the overlap betweenthe State management function and corporate governance role has made SOEs lessactive and caused the responsibility dodge among business leaders.
Theoverlapping management also causes deliberate wrongdoings and violations in implementinginvestment projects.
Among12 loss-making and ineffective projects reported by the industry and trade sector to the NA recently, many reflect thereal situation of capital management and corporate governance, he noted,stressing that not only heads of these enterprises but also managers of relevantministries and agencies must be responsible for those, including criminalliability.
Expressing his sympathy with solutions stated in the NA’s monitoring report, hesaid it is necessary to accelerate the completion of institution and legalframework for the State Capital Management Committee.
Inthe coming time, the industry and trade sector will continue to closelycoordinate with ministries and sectors to implement the State's directions,especially in improving the management mechanism and clearly defining the Statemanagement and corporate governance; bettering the legal framework to ensuresustainable economic development, and promoting integration so that State-ownedand private businesses can take advantage of market opportunities, the ministeraffirmed.-VNA
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