The next government must make a series of decisions to promote economic development and the growth of private companies. The most urgent aspect of Corporate Governance in Argentina to improve is the recovery of total freedom in decision-making by the management bodies of companies, without threats or influences from the national government. It is essential to understand that the flip side of a political environment of high discretion in favor of the government is low investment and unattractiveness of the private sector, which leads to poor development of companies and the value of the salary of the entire economy. This is the cause of the current scenario and that must be corrected.
The company directors of Argentina fervently defend the development of private companies, the basis of the economy, integration and healthy growth of Argentine society. We are convinced that improvements in corporate governance, both in the public and private sectors, are only achieved with the presence and freedom of action of professional and independent directors, with permanent training in certified programs, selected using transparent criteria to form diverse and balanced boards.
That is why, in view of the runoff, the company directors associated with the Institute of Business and Public Governance (IGEP), a civil association formed by company directors interested in the dissemination and improvement of corporate governance in Argentina, propose a Basic Agenda on Corporate Governance issues for the period 2024-2027. This Agenda emerged from the deliberations carried out by our community of directors at the XII Annual Convention of the IGEP held recently at the Stock Exchange.
What should the next government do.
Whoever wins on Sunday must end the limitations on the free establishment of prices, limitations on the hiring or dismissal of workers beyond current laws, salary increases by DNU, limitations on the management of financial resources and the distribution of dividends, restrictions exchange rates, foreign trade restrictions, expropriation attempts and excessive operating prohibitions during crises.
Public enterprises.
The new government must work on the correction of the wide scope of the companies with shares in the hands of the State, both state-owned companies and companies in which the ANSeS Sustainability Guarantee Fund has shares. Following the OECD principles is a more than sufficient guide in this great chapter: the strict and professionalized regulation of the operation of the Sustainability Guarantee Fund of the Pay-as-You-Go Pension System, to avoid distortion of the domestic capital market, the elimination of the special for the representative directors of the ANSeS in listed companies (Decree 1278/12) and professionalization and transparency in the appointment and exercise of state directors in private companies.
Clarification of the role of the State as a shareholder and the financial assistance permitted is necessary. transparent recruitment of members of collective bodies of state or parastatal companies, requirement of training in certified programs for members of collective bodies of companies or state or parastatal entities, in-depth review and improvement of the corporate governance of state companies and joint-stock companies of the State, to deepen the regimes of compliance and the accountability of its officials and the separation of public limited companies with State participation from the financial administration regime of the public sector, with full force of the general corporate law (LGS).
Reconstruction of the Capital Market.
Once the economy has been stabilized and the currency, solvency and private banking credit have been recovered – conditions without which no corporate governance or economic measures in general make any real sense – work must be done to reconstruction of the capital marketto get companies to join it – instead of delisting, as is currently the case – since the capital markets are a main ally of Corporate Governance.
Reintegration into the International Financial Market.
It is essential to reinsert the Argentina in the international financial market, the normalization of relations with international financial organizations, the freedom of international financial movements, in the medium and long term, the reconstruction of private savings vehicles, including the creation of Voluntary Private Pension Funds and Life Insurance with tax incentives, the sanitation of the regulations that affect the exchange market and the mutual fund sector, insurance companies and banks.
The author is an economist, president and founder of the Institute of Company Directors of Argentina (IGEP), with global representation (GNDI)
Source: Ambito
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