The main prerequisite for increasing the role of corporate governance in the Republic of Uzbekistan supports the acute shortage of investment resources needed to upgrade various aspects of corporate enterprises linked with an increase in the level of their competitiveness and enhance their export potential. Another important prerequisite for the implementation of corporate governance has been striving to improve the competitiveness of domestic producers and raise middle-class owners of real production. The President of the Republic of Uzbekistan Islam writings Karimov has repeatedly emphasized that: «The transfer of ownership in the hands of the present owners, providing them with opportunities for business and is the main point of economic reforms». In order to promote the accelerated development of the private sector, dramatically increasing its role and importance in the economy, a radical improvement of the system of corporate governance of privatized enterprises by the Decree of the President of the Republic of Uzbekistan № 4720 from May 25, 2015 «On measures to radically increase the proportion and significance of private sector in the Uzbekistan's economy «is recognized inexpedient the preservation of the state share in the authorized capital of joint stock companies in the amount of 25 percent or less, and instructed to carry out its implementation mainly in private ownership.
In order to improve the system of training, retraining and advanced training of the managerial personnel of companies, increasing business management efficiency in terms of corporate governance at the Higher School of Business under the Cabinet of Ministers set up Research and Education of corporate governance center, which will be education and training of members of the supervisory councils, members of executive bodies of companies, members of audit committees, employees trust managers of investment assets and state attorneys, specialists of state bodies of economic regulation, the shareholders and owners of private enterprises.
Timely study and implementation of the best international corporate governance experience in the practice of the best enterprises of the republic should allow:
‒ To ensure the formation of long-term strategies for the development of enterprises, aimed at the high end of the economic entity;
‒ Implement effective management structures that would allow the unity of rights and responsibilities of all the functional and structural units of the final results of the joint-stock company;
‒ Form codes of conduct, providing incentives for the development of corporate relations and designed to be a decisive factor in resolving corporate conflicts and harmonize the interests of all participants in the corporate community;
‒ Increase the level of transparency of joint stock companies through a combination of internal and external audit work of the JSC, as well as strict adherence to the norms and rules of corporate behavior;
‒ Implement democratic style of management software based on the accountability of executive bodies Management SA;
‒ Improve the effectiveness of labor incentives of managers and staff of joint stock companies through the introduction of a system of key performance indicators of JSC;
‒ To form a flexible dividend policy of joint-stock enterprises, taking into account the real needs of the company and all members of the corporate community.
Among the priority measures of the state, economic agencies and financial institutions to facilitate the implementation of the best international corporate governance experience in the practice of joint-stock companies of Uzbekistan, should include such of them as:
‒ Promoting the systematization and implementation of better corporate governance excellence in the practice of joint-stock enterprises of the republic;
‒ Formation of a new state support for the concept of corporate governance at the level of joint-stock enterprises;
‒ Modernization of the regulatory framework governing the relationship members of the corporate community;
‒ Expansion of the range and scale of state involvement in the financial support program of innovative development of corporate enterprises;
‒ Ensure institutional strengthening and further functional development of the secondary securities market of Uzbekistan;
‒ Improving the effectiveness of monitoring the effectiveness of the dividend policy of joint-stock enterprises with foreign founders;
‒ Organization of regular training the most promising managers of large corporate enterprises on the basis of leading international corporations.
One important area of reform programs and structural reforms to diversify the economy in the years 2015–2019 is to ensure the reliable protection of private entrepreneurship and small business interests, increasing the role of private ownership and the progressive reduction of state presence in the economy.
In this context, the importance of acquiring the introduction of modern corporate governance practices to help improve the efficiency of joint-stock companies in the country and the deepening of the privatization processes. In principle, an important step in improving corporate governance became Decree of the President of Uzbekistan «On measures for the introduction of modern methods of corporate governance in joint stock companies» dated April 24, 2015 Resolution «On additional measures to attract foreign investors in joint-stock companies» dated December 21, 2015. These documents define the main tasks for optimizing the latest activities.
It should be noted that today in Uzbekistan has carried out significant work in this direction. In particular, it formed legal corporate governance framework for all joint-stock companies set up corporate governance bodies are functioning organizations that provide consulting services, approved the relevant decision of the Government to accelerate the process of implementation of quality management systems in enterprises.
On the basis of the above documents in 2015 carried out a complete inventory of all the activities of joint-stock companies of the republic. At the same time it developed and approved a new standard structure of AB. Eliminated the old and new units and positions introduced. Measures to appointment to senior positions of young, well-educated local and foreign experts, with skills in practice of modern management and marketing.
Particular attention is paid to attracting business entities in foreign investors, creating favorable conditions for their active participation in corporate governance, modernization, technical and technological re-equipment of production. For this purpose, put the order in which the authorized capital of JSC share of foreign shareholders shall be not less than 15 %.
The importance of the reform process have training issues for the sector. In this context it should be noted the activities of the Research and Education Center of Corporate Governance, which in a short period with the participation of leading international experts was organized training about 160 heads of stock, banks and enterprises of Uzbekistan. More than half of them have been trained in the best corporations in Europe for a close study of international experience in this field.
During the introduction of innovative methods of business process management studied the experience of developed countries, in particular Germany. In 2015, together with the German company Indecon Consulting developed a draft Code of Corporate Governance, which was approved by 16 February 2016.
Adoption of the Code is intended to serve as a set of recommendations for all joint-stock companies in the process of implementation of international standards of transparent operations, increase the responsibility of the directors, to strengthen the role of minority shareholders in the management of enterprises.
"- An effective tool for the implementation of the corporate governance standards of the Corporate Governance Code» On the occasion of the adoption of the Code on February 23 this year, an international conference on the subject was held in Tashkent. The main objectives of the conference were the explanation and discussion of current trends in the sphere of improvement of the country and foreign countries, the key areas and the provisions of the Code, aimed at improving the joint-management, tasks and practical recommendations to accelerate the implementation of activities in the stock of relevant international standards and norms.
In the event, along with national experts and managers of joint stock companies and joint ventures was attended by representatives of international financial institutions like the World Bank, Asian Development Bank, International Finance Corporation, the United Nations Development Programme, as well as the diplomatic corps in Uzbekistan and foreign experts.
According to participants of the conference, developed by the Corporate Governance Code summarizes the best international practices, adapted for use in the Joint Stock Companies of the Republic, and its successful implementation will contribute to the implementation and further improvement in companies and firms of Uzbekistan the basic principles of corporate management, transparency of activity of JSC and JV Protection rights and legitimate interests of shareholders.
As a result of the presentations and discussions at the International Conference for the speedy implementation of the recommendations of the document in order to achieve a balance of interests of the management bodies of JSC were adopted, shareholders and the workforce. In addition, there was the need to define as strategic objectives of the company to maintain financial stability, increase in labor productivity, growth in production and export performance, energy efficiency achievement, the implementation of modernization, technical and technological renovation of production facilities.
Thus, taken in Uzbekistan, measures for the implementation of effective forms of management are consistent and well thought-out steps aimed at further liberalization of the market economy through reform, structural transformation and diversification of the economy. Undoubtedly, they will enhance the entrepreneurial activity, attract foreign investment and further economic growth.
The impressive economic growth of Uzbekistan and large-scale structural transformations performed during the years of Independence attract the attention of international organizations, largest companies, investment funds and agencies. Therefore, it is natural that the unprecedented privatization programs of the state-owned property and implementation of the large-scale investment projects started during the current year in Uzbekistan, caused enormous interest on part of the international business community.
Investment is time, energy, or matter spent in the hope of future benefits actualized within a specified date or time frame. In finance, investment is buying or creating an asset with the expectation of capital appreciation, dividends (profit), interest earnings, rents, or some combination of these returns. This may or may not be backed by research and analysis. Most or all forms of investment involve some form of risk, such as investment in equities, property, and even fixed interest securities which are subject, among other things, to inflation risk. It is indispensable for project investors to identify and manage the risks related to the investment.
The Government of the Republic of Uzbekistan is pleased to announce that it will host an International Investment Forum on November 5–6, 2015 in Tashkent city. The main objective of the event is to present the leading enterprises of the Republic of Uzbekistan, included in the state program of privatization, and to sell them to strategic foreign investors capable of ensuring modernization and technological renewal of production, manufacturing of goods competitive in both domestic and external markets, as well as introduction of modern corporate governance practices.
560 foreign participants including heads and managers of over 300 foreign companies, European Community, Governments of Korea, Germany, Poland, Japan, Kuwait and other states, large companies, banks, investment funds, agencies, analytical centers, representatives of financial and business circles from 33 countries of the world, as well as international financial institutions, such as the Asian Development Bank, the World Bank, the International Finance Corporation and others — participated in the work of the International Investment Forum held in Tashkent on November 5–6, 2015.In course of the first plenary session, the Forum’s participants got familiar in detail with the strategy and the results of the economic reforms, having been implemented in our country during the years of Independence under the leadership of the President Mr. Islam Karimov, based on the five main principles of reforming and development of Uzbekistan, which got wide recognition in the world as the “Uzbek model” of reforms. Special attention of the Forum’s attendants was attracted by the prospective guidelines of Uzbekistan’s development, determined by the Program of further reforming, deepening of structural transformations and diversification of the economy for the period of 2015–2019, aimed at the achievement of the following key targets:
‒ continuation and deepening the economy’s reformation;
‒ further implementation of structural transformations, modernization and diversification of the industry, construction of the modern enterprises and output of products with the high added value on basis of the richest resources of Uzbekistan and attraction of the highest technologies from Korea, Germany, Japan, USA, Switzerland, France and other countries;
Timely and high-quality implementation of best practices of good corporate governance organization in the practice of joint-stock enterprises of the republic will not only improve the efficiency of their work and to attract foreign capital for the needs of their innovation development, but to raise the investment attractiveness of the whole of the emerging stock market in Uzbekistan.