Экономические науки/14.Экономическая теория

Cand. of Sc., docent Koryagina T., Cand. of Sc., docent Osatska Iu.

Dnipropetrovsk State Financial Academy

The Institutional Environment of the Corporate Sector Development in Ukraine

Development of the economy of Ukraine significantly depends exactly on productivity and effectiveness of the functioning of its corporate sector, which plays the leading role in the national economy. At the same time, the financial and economic crisis in the global economy resulted in the increase of unprofitability of activity of the corporate sector enterprises.

The important factor of the low effectiveness of activity of the corporate sector entities in Ukraine is the imperfection of the institutional support of the corporate sector development. This is why the issue of improvement of the institutional environment of the corporate sector becomes especially urgent today.

The institutions embrace all kinds of limitations that coordinate interaction between the agents of the economic life, which, in our opinion, include both the formal limitations – e.g., laws and regulatory documents, and the informal limitations – e.g., traditions, customs and codes of conduct, which essentially complement the official rules and regulations. The formal and informal regulations, the manner and effectiveness of their observation by all participants of the economic life form the character and conditions for the economic growth in the country [1, p. 12].

The institutional environment of the corporate sector development in Ukraine comprises the valid and effective regulatory and legal framework, governmental and non-market non-governmental institutions of self-organization and self-regulation of the economic activity, the branched market infrastructure. It provides for creation of the progressive ownership structure, the banking system and stock market development, maintaining an attractive investment climate.

The factors reducing effectiveness of the institutional environment of the corporate sector are as follows:

- vulnerability of the property rights;

- variability of the legal framework;

- non-uniformity of development of the market infrastructure institutions;

- cycling of the economy development.

The issue of the property rights protection demands, in the first place, solution of the problem of balancing the rights of major and minor stockholders. When such balance is reached, reduction of losses caused by corporate conflicts and the general increase in the corporate sector efficiency will become possible.

The institutional and legal solution is required by the processes of the corporate control and management in such areas of the corporate relations like:

- merger and acquisition;

- interaction with affiliated structures;

- control over large-scale agreements;

- bankruptcy and many others [2].

The institutional support of the corporate sector development needs modernization of the capital markets in Ukraine in order to provide for their competitive strength through reformation of the capital markets in all its constituents. It is important to create such conditions of the financial and economic relations, which will ensure unobstructed movement and servicing of free monetary funds, their conversion into the investment capital that yields profit, provides for development of the entire economy, primarily through its innovative development.

Modernization of the capital markets shall be based on solution of the following tasks at the legislative, institutional and technological level:

˗ The institutional reform of the capital market, which implies creation of new powerful financial institutions (investment companies and investment banks), strengthening the role of the collective investment institutions, pension funds and insurance companies for accumulation of savings;

˗ Provision of development of financial instruments as the objects of investment resources placement, including through development of the market of derivative financial instruments, legislative improvement of conditions of rating activity;

˗ Provision of tax incentives for the capital markets.

The effective professional activity of the institutional investors on the capital market needs:

˗ Adoption of the Laws of Ukraine “On Investment Banks”, “On Investment Companies” in order to stimulate the investment-innovative activity.

˗ Amending the Laws of Ukraine “On Collective Investment Institutions” – in terms of extension of investment standards, improvement of the procedure for registration of emission of securities issued by the collective investment institutions, “On Non-State Pension Provision” - regarding the expansion of the list of objects and norms of the pension funds investment, improvement of the procedure for the investment profit distribution.

Adoption of the above laws will enable creation of the effective investment structure and attractive environment for implementation of investment projects in the corporate sector of Ukraine.

Solving tasks of facilitating the development and effectiveness of the corporate sector in the Ukrainian economy demands the active regulation by the government, aimed at creation of the common institutional and legal framework for corporate relationship development.

References

1. Норт Д. Інституції, інституційна зміна та функціонування економіки / Д. Норт / Пер. З англ.. І.Дзюб. – Київ: Основи, 2000. – 198 с.

2. Гафиятов И.З. Институциональная природа корпораций в современной российской экономике / И.З. Гафиятов // Российское предпринимательство. — 2007. — № 11 Вып. 2 (102). — c. 42-46. — http://www.creativeconomy.ru/articles/12267/