Teksts
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Last week witnessed two quite extraordinary events in Riga,
which can only demonstrate to outside observers that getting normal
business done in Latvia, a proud member of the EU, is impossible
and the business practices of its “leaders” have no place in a
Western democracy.
Firstly there was the continuing postponement of LK’s extraordinary
shareholders meeting, due to have been held on October 8th. No LK
shareholder meeting has taken place since April 2009. The urgent
need for the meeting, the agenda items and the potential re-shaping
of the Supervisory Council (with no change in the number of members
nor the representation on the Council, including the representation
of the State Social Insurance Agency) have all been fully covered
in the last press release issued by VN. Yet again, these points are
re-confirmed by VN. No change in the numbers, no change in the
representation of the State Social Insurance Agency. What is needed
is change in the cost of the Council, a change in the system of
governance and a return to normal business practice at what was
once a proud Latvian company that has now fallen into disrepute.
Shareholders are the legitimate owners of public companies and
public companies have responsibilities to engage with their
owners.
Secondly the public witnessed the fortification of the office.
Again, hardly the action or behaviour that one would expect from a
public company, owned by its shareholders, which has yet to file a
set of Annual Accounts for 2009.
It is also a shocking signal that Latvia, an EU member, cannot
guarantee the safety of investments and that investor rights are
threatened. This is hardly the backdrop against which external
investors would consider selecting Latvia as a place to invest
their capital.
VN management yet again stresses that it is unacceptable for a
public company, owned by its shareholders, to fail to meet with its
shareholders on a regular basis, to review and discuss all aspects
of business and strategy. As a 49.9% shareholder, VN has legitimate
rights to engage with the management and has insisted on convening
shareholders meetings since the beginning of 2010. Despite multiple
attempts for this to take place, LK management has gone out of its
way to prevent any discussion or engagement, blatantly abusing the
laws of corporate governance in Latvia. What is it that they have
to hide?
The performance, costs, attitude and behaviour of the management of
LK are outside acceptable business practice in any public company
within the EU. As previously stated, the LK Supervisory Council
have paid themselves 5 million lats in the last 3 years, an
appalling misuse of shareholder funds for the personal enrichment
of the Supervisory Council members. This at a time when all the
indications are that the company is on the verge of financial
collapse and is incapable of producing proper audited accounts. To
declare that Supervisory Council member salaries are “confidential”
makes an absurdity of the concept of transparency and public
accountability. Perhaps we could remind the Supervisory Board
members of who actually pays their salaries All of this in the
third largest public company within Latvia. A shame on Latvia.
Ventspils nafta
Zane Bojāre
JSC „Ventspils nafta” PR Manager
E-mail: zane.bojare@vnafta.lv
Phone.: 67821691; 29706733
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