Russian Central Bank says negative practices in disclosing info, corporate governance restraining capital market, need to eliminate them

MOSCOW. Oct 4 (Interfax) - The Central Bank of Russia is concerned about the negative trends in information disclosure and corporate governance, namely in the relations of companies with minority shareholders, and both regulators and market participants need to correct the situation, Central Bank First Deputy Governor Vladimir Chistyukhin said.

"Unfortunately, we are seeing a negative trend. It is well known to everyone when corporations, under the guise of needing to protect themselves from sanctions, begin to restrict all possible information, oppose minority shareholders, and carry out some actions that worsen the position of minority shareholders. Of course, we will not build a trusting environment in the capital market on this," Chistyukhin said during the discussion on the Main Directions for Developing the Russian Financial Market in 2025-2027 at the Forum analytical center.

Chistyukhin said that unlike retail investors, this is a key issue for institutional investors when taking investment decisions.

"Understanding what practices exist, it would not go anywhere to invest, in any shares. Here, I believe, we as a state, not only the Central Bank, but also the government - we will not raise the issue without the government - have enormous potential for development. Just as the Central Bank must make maximum efforts, so market participants must, excuse the term, lobby the issue at all levels and try to explain rationally why it is extremely important to ensure correct corporate practices, to disclose information," Chistyukhin said.

Galina Morozova, chairperson of the board of directors of Future Non-state Pension Fund, who participated in the discussions, supported Chistyukhin.

"It is extremely important for non-state pension funds to have a history of strict, clear, and transparent corporate governance of a company. I understand that this corporate culture for all issuers is as if the Central Bank has resolved the underlying cause with some additional restrictions. However, for investors who invest other people's money for the long term, it is extremely important for us to understand how this issuer behaves in relations with minority shareholders. Despite the volumes, we are minority shareholders," Morozova said.

What policy a company pursues regarding the disclosure of information, strategy, and dividends, including the fulfillment of obligations to pay them, is important for institutions Morozova said. "Namely, it is necessary not only to promise, but also to show repeatedly that we are fulfilling this," she said.