BOFIT Discussion Papers, Institute for Economies in Transition, Bank of Finland
No 12/2002:
Federal state shareholdings in Russian companies: Origin, forms and consequences for enterprise perfomance
Alexander Muravyev ()
Abstract: This paper studies the impact of federal state
shareholdings on the performance of Russian companies. It differs from most
similar studies in two respects. Firstly, it focuses on mixed ownership
companies rather than conventional state enterprises. Secondly, it
distinguishes between several types of federal state shareholdings, namely
elected blocks, residual blocks (which may be held by two bodies with
different functions – the Ministry for State Property and the Russian Fund
for Federal Property) and golden shares. The paper describes the origin of
federal state shareholdings and discusses their possible implications for
company performance. Econometric analysis shows that companies with state
ownership generally perform worse than the average firm in terms of labour
productivity and profitability. However, there are remarkable differences
in the performance of companies with different types of state
shareholdings. Companies with residual blocks held by the Property Fund are
the worst performers, followed by companies with residual blocks held by
the Ministry for State Property. Companies with elected shareholdings as
well as with golden shares do not differ from the average enterprises in
the respective industries. These differences in performance are explained
by the different degrees of control the federal state has over enterprises
with various types of shareholdings – greater control is associated with
better performance. The paper concludes that the government should avoid
keeping equity stakes in companies unless there is a good reason to retain
them. If the state wants to keep an ownership stake in a company, reliable
control structures must be created. Finally, the issue of golden shares in
strategically important companies seems to be a reasonable alternative to
retaining some control over them through equity ownership.
Keywords: corporate governance; state ownership; firm performance; Russia; (follow links to similar papers)
37 pages, October 1, 2002
Before downloading any of the electronic versions below
you should read our statement on
copyright.
Download GhostScript
for viewing Postscript files and the
Acrobat Reader for viewing and printing pdf files.
Full text versions of the paper:
dp1202.pdf 
Download Statistics
Questions (including download problems) about the papers in this series should be directed to Päivi Määttä ()
Report other problems with accessing this service to Sune Karlsson ()
or Helena Lundin ().
Programing by
Design by Joachim Ekebom
