Rollback of corporate reform of distribution network system will complicate attracting financing for infrastructure, - Energy Club appeal to Shmyhal
The opaque formation of new supervisory boards at distribution system operators that are part of JSC Ukrainian Distribution Networks (URM) (which manages state-owned stakes in regional energy companies) sends an extremely negative signal to the market and may significantly complicate the attraction of financing for the restoration of energy infrastructure.
According to Censor.NET, this is stated in an appeal from the Energy Club NGO to First Deputy Prime Minister and Minister of Energy of Ukraine Denys Shmyhal.
As stated in the appeal, on February 27, 2026, most distribution system operators whose share packages have been transferred to the authorized capital of JSC "URM" are scheduled to hold extraordinary shareholders' meetings. Analyzing the preparations for these meetings, Energy Club notes serious deviations from the course of corporate reform declared by the government.
"The most concerning issue is the non-transparent formation of new supervisory boards of OSRs without the use of public competitive procedures. However, the most critical violation is the deliberate rejection of the institution of independent members of supervisory boards," according to a publication on the NGO's website.
"This approach completely negates the very essence of the supervisory board as an independent control body. It is a direct violation of current Ukrainian legislation and OECD guidelines, and also contradicts best European practices. Today, our international partners and investors pay close attention to the transparency of state asset management. The rollback of corporate reform sends an extremely negative signal to the market and could significantly complicate the attraction of financing for the restoration of energy infrastructure," Andriy Kostrytsya emphasized.
In order to prevent the destruction of corporate governance principles in the energy sector, Energy Club officially appealed to the leadership of the relevant ministry.
In particular, the CSOs demand to initiate the suspension or cancellation of the decisions of the extraordinary shareholders' meeting at OSR, scheduled for February 27, until the procedures are brought into line with corporate governance standards, to ensure an open and transparent competitive selection process for members of OSR supervisory boards, guarantee unconditional compliance with the quota for independent members on supervisory boards, as required by law, and guarantee a transparent and understandable method of forming the executive bodies of the OSRs, which will be in line with the Government's policy on the management of state-owned enterprises.
"Energy Club continues to consistently advocate for transparent rules of the game in Ukraine's energy market and emphasizes that only compliance with European management standards will attract the necessary investments for the reconstruction and development of the industry," the publication says.
