During today’s Government meeting chaired by Prime Minister Bakytzhan Sagintayev, Minister of Healthcare Yelzhan Birtanov reported on the implementation of measures on developing corporate governance and management in medical organizations.

Within the framework of implementing the 81 step of the Plan of the Nation “100 Concrete Steps”, as well as the Densaulyk Healthcare Development State Program for 2016-2019, the Ministry of Healthcare is working on introducing principles of corporate governance and management in medical organizations.

In addition, in his Address to the People of Kazakhstan of 2014, the Head of State instructed to implement OECD standards and principles in order for Kazakhstan to join the 30 most developed countries of the world.

Thus, with regards to improving the competitiveness and the efficiency of Kazakhstan’s companies, implementation of the OECD Principles of Corporate Governance is a topical issue.

To date, the majority of Kazakhstan’s medical organizations are already transformed into legal forms that facilitate the introduction of corporate governance elements, such as enterprises on the right of economic management with supervisory boards (RSE on REM with SB), JSC and LLP. Out of 42 subordinate healthcare organizations, the number of those transformed into JSC is 10, RSE on REM with SB - 25, RNE - 3, SA - 3, LLP – 1.

In pilot medical organizations, the Ministry carried out a rating of the effectiveness of their activities. As such, it was found out that medical organizations that implemented the principles of corporate governance have higher efficiency than organizations that did not implement these principles.

To date, the total number of public health organizations is 840, of which 750 are to be reformed into SEs on REM. By the end of 2017, the number of organizations reformed to REM amounted to 618 or 82%. The remaining 132 organizations are to be reformed into SEs on REM in 2018. Thus, by the end of 2018, 100% of organizations will operate on REM.

As Yelzhan Birtanov noted, active work is carried out to provide organizational and methodological support to organizations at the regional level. Standard corporate documents are being developed and implemented for JSCs, SEs on REM, which are implemented in all subordinate JSCs of the Ministry of Healthcare and partially in regional organizations. In addition, work is carried out to ensure the transparency of the activities of MOs by creating a section on "Corporate Governance" on their official websites.

The regions are working on the creation of collegiate management bodies - supervisory boards. In 2017, their number in SEs on REM amounted to 352. Active work is carried out to update the composition of collegiate management bodies in order to include representatives of the public and business in subordinate organization of the Ministry.

A rating of regions on the implementation of the Corporate Governance Principles was drawn up in 2017, taking into account the creation and full operation of supervisory boards.

“We see that Astana, Almaty, West Kazakhstan and Karaganda regions show high results,” – the Minister of Healthcare said.

Within the framework of improving leadership and professional management, the issue of training professional managers in the healthcare sector remains urgent.

The industry employs about 3000 top managers. However, 60% of heads of medical organizations have higher medical education without professional education in management. And only 13.5% of the first leaders have a master's degree.

Yelzhan Birtanov emphasized that medical organizations should be headed by professional managers. To this end, a new master's program “Health Management” was introduced; training programs have been developed, as well as a standard curriculum for the training of masters; the professional standard is under approval; independent certification is introduced.

One of the main indicators of the effectiveness of management is the salary of a doctor. According to the Statistics Committee, the average monthly salary of a doctor in Kazakhstan is 159 307 tenge, and the nominal wage of an employee 147 988 tenge, the ratio as a whole for the country is 1.1.

In accordance with the Densaulyk Healthcare Development State Program for 2016-2019, the target for 2017 - 0.9, 2018 - 0.9, 2019 - 1.1. In the context of the regions, there are instances of overfulfilment of the State program – in some the ratio reaches 1.5: 1.

In conclusion, Yelzhan Birtanov assured that work on the development of corporate governance and management will continue. For effective corporate governance and management in medical organizations, it is planned to legislatively consolidate the Principles and concepts of corporate governance, in accordance with the OECD Guidelines.

IFC expert, representative of the World Bank Adalyat Abdupanapova also took part in the consideration of the issue. According to her, to date, corporate governance at macro and microeconomic levels is one of the decisive factors for the successful development of the national economy of any country. Within the framework of her presentation, Adalyat Abdupanapova highlighted two points that underline the importance of corporate governance in Kazakhstan.

“First, based on our experience as an international investor, we came to the conclusion that the successful development of business and attracting investments directly depends on the availability of proper corporate governance practices,” – the representative of the World Bank said.

Adalyat Abdupanapova expressed her opinion that progressive work is being done in Kazakhstan to improve the system of corporate governance, as traditionally the health sector is one of the most attractive for investment.

“The second issue I would like to dwell on is that traditionally, historically, the concept of corporate governance has evolved as a tool for private corporations, but in the last few years, focus has shifted to companies with state participation. It is expected that these companies are able and even responsible to create a positive example, which local companies will follow,” – Adalyat Abdupanapova said.


Published: 06 February 2018


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