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OECD Guidelines: Which Should Come First?
As I noted in a Discussion at the beginning of the year, the Organisation for Economic Co-operation and Development (OECD) is in the process of updating its Guidelines on Corporate Governance of State-Owned Enterprises.
Over the last eight months, things have gone quickly for the State-Owned Enterprise (SOE) Guidelines. Not only did the OECD create a project website for this revision, it also already put out a draft text of the revised guidelines for public comments.
IFAC actively participates in the revision of these guidelines through our membership on the Business and Industry Advisory Committee to the OECD, where we provide input on projects. Our feedback included noting that since the SOE Guidelines were developed as a complement to the OECD Principles of Corporate Governance, on which the SOE Guidelines are based, the revision of the SOE Guidelines should not get ahead of the update of the Corporate Governance Principles. The revised Guidelines should be cognizant of changes in the Principles (a project that is also currently taking place; see my earlier Discussion as well as the OECD project web page). We feel it is important not to walk too far ahead of the revision of the Corporate Governance Principles since they provide a base. Something the OECD nevertheless did with this new draft for the SOE Guidelines…
One of the our more fundamental issues with the SOE Guidelines is that they are not primarily focused on SOEs themselves but rather on the state as their owner. For this reason, IFAC recommended a slight tweak of the title—OECD Guidelines on the Enablement of Corporate Governance of State-Owned Enterprises. In addition, IFAC has submitted four pages of detailed recommendations.
Naturally, many of our comments are inspired by the recent publication of our International Framework: Good Governance in the Public Sector, which seeks to improve and encourage effective public sector governance.
You can have a say in the revision of the SOE Guidelines too! Either direct through the OECD comment page (by September 8, 2014) or through your comments on this page as we would be happy to consider your recommendations while finalizing our response to this first draft text.
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July 24, 2014 - Chartered Institute of Management Accountants, St Paul’s Institute
July 2, 2014 - IFAC, Chartered Institute of Public Finance and Accountancy
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