State-owned enterprises (SOEs) are significant players in many countries around the world, providing sizeable contributions to GDP, creating jobs, and supplying essential services to citizens, such as light and power, healthcare, water, transportation and education. As a result, the performance of SOEs has a direct impact on the social, political, and economic development of a country and on people’s everyday lives. Economies with inadequate governance and low accountability of SOEs tend to face poor delivery of essential public services, stifled competitiveness and restricted economic growth, as well increased opportunities for political patronage and corruption. One of the key challenges that countries are facing in building effective state ownership is to ensure proper governance and transparency of SOEs.
Transparency and disclosure are vital to holding SOEs accountable for their performance, an important issue for the public and the private sector: SOEs can deliver on their mandates while contributing to the economy via dividends and taxes when they perform well. Reliable financial information is essential for establishing the accountability mechanisms, allowing well-informed decision making on the part of management, board of directors, government acting as shareholder, potential and current investors and lenders, as well as civil society and citizens, as ultimate owners of SOEs.
CFRR team is working with the client-governments in implementing robust frameworks for accounting, reporting, and auditing of SOEs - as well as an oversight mechanism for these – to progress towards well-governed, transparent, and accountable SOEs, contributing in a positive way to the economy and society.