Public transparency

Minister of Planning explained that in the case of some companies, adoption of the new standards reach 80%

The Minister of Planning, Development and Management, Dyogo Oliveira, said on Thursday (29) that some of the main Brazilian state-owned companies are already at an advanced stage in implementing the new governance rules. One of the first measures of the Michel Temer government, the State Law was passed in June by the National Congress and regulated yesterday (28).

In the minister's calculations, the largest state-owned enterprises have made rapid progress in implementing these standards. "We already have the National Bank for Economic and Social Development (BNDES), Banco do Brasil, Caixa Econômica Federal, Eletrobras and Petrobras already in an advanced stage of implementation. In some cases, more than 80% of the requirements have been met, "he explained.

In practice, the Statute of State Companies establishes stricter rules for appointments in management positions and in biddings. The document also contains specific rules for smaller companies and details of mechanisms and structures for transparency and governance.

More transparency

The rules apply to all federal state-owned companies: public companies, mixed-capital companies and their subsidiaries, and any company whose majority of the voting capital belongs directly or indirectly to the Union.

Check out the main rules:

Audit Committee
The subsidiaries can share structure with the holding. It will have three to five members and should meet at least twice a month. Or, in the case of public and financial institutions, at least four times. All members must be independent except for smaller companies where this requirement applies only to the majority of members.

Area of risk management and compliance

The subsidiaries may share structure with the holding company. There is no minimum number of positions for the area, which does not have to be an executive board. This is an important mechanism for fighting corruption.

Code of Conduct and Integrity

It should contain ethical principles and sanctions for noncompliance. The Code of Senior Management should provide for a rule on disclosure of information related to matters affecting state enterprises.

Eligibility committee

Will check requirements and fences (valid since 07/17/2016) for the indications made by the supervisory ministries. It also has the additional attribution of assisting the Board of Directors in evaluating the performance of the officers.

Mechanism of control for the appointments of directors and advisors

Detailed evaluation, with double checking, done by the supervisor ministry and by the company itself through the Eligibility Committee.

Administrative Council

It should subscribe to the Annual Letter of justification of the public mission, in compliance with the recommendation of the Organization for Economic Cooperation and Development (OECD), whose model will be published on the website of the Ministry of Planning. It will have at least 25% of independent members appointed by the supervising ministry, except smaller companies with gross operating revenues of less than R $ 90 million.

Creation of the General Assembly

This mechanism will strengthen governance, transparency and social control in state-owned enterprises.

Reinstatement limits for directors and advisors

Its objective is the oxygenation of the administration and the management committed with results.

Disclosure of the remuneration of managers and directors in a detailed and individual way

Transparency mechanism active on the Internet, in compliance with the recommendations of the OECD and the Brazilian Securities and Exchange Commission (CVM).

Creation of variable portion in the compensation of the directors, linked to the accomplishment of objective goals

It brings state management closer to the private paradigms of efficiency and commitment of top management with measurable results.

Disclosure of quarterly financial statements

The information shall be disclosed and audited by an independent auditor. Promotes transparency and accuracy of information.

Source: Portal Brazil, with information from the Ministry of Planning, Development and Management