Title page 1

Contents 6

Preface 4

Foreword 5

Abbreviations and acronyms 8

Executive summary 9

1. Recommendations and roadmap 11

1.1. Rationales for state ownership 13

1.2. The state's role as an owner 14

1.3. State-owned enterprises in the marketplace 15

1.4. Equitable treatment of shareholders and other investors 15

1.5. Disclosure, transparency and accountability 16

1.6. Composition and responsibilities of the boards of state-owned enterprises 16

1.7. State-owned enterprises and sustainability 17

Notes 20

2. Overview of Ukraine's state-owned enterprise corporate governance landscape 21

2.1. Overview of the economic and political context in Ukraine 22

2.1.1. Government 23

2.1.2. Legal and judicial system 23

2.1.3. Economic development 24

2.1.4. Fiscal developments and market sentiment indicators 25

2.1.5. Banking sector 25

2.1.6. Capital markets 27

2.2. Size, structure and economic significance of Ukraine's state-owned enterprise sector 28

2.2.1. Number and type of SOEs 28

2.2.2. Operational performance 28

2.2.3. Sectoral distribution of SOEs 28

2.2.4. Privatisation 29

2.3. Legal and regulatory environment for state-owned enterprises 32

2.3.1. New and amended legislation bearing on corporate governance of state-owned enterprises 32

2.3.2. Law on the Improvement of SOE Corporate Governance - New "SOE law" 34

2.3.3. Other legislative initiatives 35

2.4. State-owned enterprise corporate governance during martial law 36

2.4.1. Special obligations imposed on state-owned enterprises 37

2.4.2. CEO appointment 38

2.4.3. Supervisory boards 39

References 41

Notes 43

3. Assessment of Ukraine against OECD Guidelines on Corporate Governance of SOEs 45

3.1. Rationales for state ownership 46

3.1.1. Articulating the rationales for state ownership 46

3.1.2. Ownership policy 48

3.1.3. Ownership policy accountability, disclosure and review 49

3.1.4. Defining state-owned enterprise objectives 50

3.2. The state's role as an owner 53

3.2.1. Simplification of operational practices and legal form 54

3.2.2. Ownership expectations and operational autonomy 56

3.2.3. Independence of boards 57

3.2.4. Centralisation of the ownership function 59

3.2.5. Accountability of the ownership entity 61

3.2.6. The state's exercise of ownership rights 62

3.3. State-owned enterprises in the marketplace 70

3.3.1. Separation of functions 70

3.3.2. Stakeholder rights 71

3.3.3. Identifying the costs of public policy objectives 72

3.3.4. Funding of public policy objectives 74

3.3.5. General application of laws and regulations 75

3.3.6. Market consistent financing conditions 76

3.3.7. Public procurement procedures 77

3.3.8. Commercial considerations 79

3.4. Equitable treatment of shareholders and other investors 80

3.4.1. Ensuring equitable treatment of shareholders 81

3.4.2. Adherence to the corporate governance code 85

3.4.3. Disclosure of public policy objectives 86

3.4.4. Joint ventures and public private partnerships 87

3.5. Disclosure, transparency and accountability 88

3.5.1. Disclosure standards and practices 89

3.5.2. External audit of financial statements 97

3.5.3. Aggregate annual reporting 98

3.6. Composition and responsibilities of the boards of state-owned enterprises 99

3.6.1. Board mandate and responsibility for enterprise performance 100

3.6.2. Setting strategy and supervising management 102

3.6.3. Board composition and exercise of objective and independent judgement 103

3.6.4. Independent board members 105

3.6.5. Mechanisms to prevent conflicts of interest 106

3.6.6. Role and responsibilities of the chair 108

3.6.7. Board employee representation 108

3.6.8. Board committees 109

3.6.9. Annual performance evaluation 109

3.6.10. Risk management and internal controls 110

3.7. State-owned enterprises and sustainability 111

3.7.1. Setting sustainability goals 112

3.7.2. Boards and sustainability 113

3.7.3. Disclosure and transparency of sustainability-related practices 115

3.7.4. Responsible business conduct 116

References 119

Annex 3.A. Corporate governance and disclosure practices 122

Notes 125

Annex A. Draft gap analysis 127

Annex B. Description of key Ukrainian SOEs and SOBs 135

References 145

Notes 146

Annex C. Key 33 SOEs in detail 147

Table 1.1. Summary of short- and medium-term reform roadmap for policymakers 18

Table 2.1. Selected economic indicators for Ukraine 22

Table 2.2. Ukraine's banking sector 26

Table 2.3. State-owned banks in Ukraine 27

Table 2.4. Distribution of centrally-owned state-owned enterprises across sectors 29

Table 2.5. Triage results (2024) 31

Table 2.6. Small-scale privatisation 31

Table 2.7. Large-scale privatisation 31

Table 2.8. Key changes to be introduced through Law No. 4196-IX 36

Table 2.9. Martial law measures imposed on selected SOEs 37

Table 3.1. Recommendations on rationales for state ownership 46

Table 3.2. Targets and indicators in Ukraine's state ownership policy 51

Table 3.3. Recommendations on the state's role as an owner 53

Table 3.4. Overview of legal forms of SOEs in Ukraine 54

Table 3.5. State ownership in Ukraine: updated institutional framework 59

Table 3.6. Overview of ownership entities 60

Table 3.7. SOE reporting instruments, responsible institutions and information disclosed 67

Table 3.8. Recommendations on state-owned enterprises in the marketplace 70

Table 3.9. Complaints on state-owned enterprises as procurement entities 78

Table 3.10. Recommendations on equitable treatment of shareholders and other investors 80

Table 3.11. Parties responsible for granting consent based on the value of goods and services of transactions 82

Table 3.12. Financial and PSO reporting requirements by state-owned enterprise type 87

Table 3.13. Recommendations on disclosure, transparency and accountability 88

Table 3.14. Disclosure requirements in Ukrainian SOEs 90

Table 3.15. Summary of financial reporting requirements in state-owned enterprises by type 91

Table 3.16. Overview of SOE objectives 92

Table 3.17. Recommendations on the composition and responsibilities of state-owned enterprises 100

Table 3.18. Supervisory board duties 101

Table 3.19. Recommendations on state-owned enterprises and sustainability 111

Table 3.20. Overview of key sustainability reporting practices by selected Ukrainian SOEs 116

Table 3.21. Selected NABU SOE cases 118

Boxes 49

Box 3.1. General objectives and rationale under the State Ownership Policy 49

Box 3.2. Letters of expectations for selected SOEs in 2025 52

Box 3.3. Governance Challenges at Ukrenergo 58

Box 3.4. Nomination committee in strategically or economically important SOEs 64

Box 3.5. Examples of funding arrangements 74

Box 3.6. Selected cases of violations in procurement procedures by SOEs 78

Box 3.7. Provisions regarding interested party transactions 85

Box 3.8. Audit standards in Ukraine 97

Box 3.9. Energoatom Under Wartime Conditions 104

Annex Table 3.A.1. Selected 10 non-financial SOEs: Corporate governance and disclosure practices (as of December 2025) 122

Table A A.1. Draft gap analysis - Near-term priorities 127

Table A A.2. Draft gap analysis - Long-term priorities 133

Table A B.1. Reform plans in 33 key SOEs 135

Table A C.1. Key 33 SOEs (2024) 147