Challenges of Public Enterprises in Kosovo on Corporate Governance

Abstract

Corporate governance has historically changed depending on the level of development of society, the economy and businesses. In terms of governance theoretical notion has undergone changes but today increasingly it is being understood as policies and monitoring implementation is done by the members of the governing body. In Kosovo with the entry into force of the Law on Companies No. 02 / L-123 in 2007 were established legal frameworks, for registration and operation of commercial companies in order to meet the practices and requirements of the European Union. Whereaswith the Law on Public Enterprises no. 03 / L-087it is set the legal framework for corporate governance of enterprises in accordance with internationally recognized principles of corporate governance of public enterprises. The problem of corporate governance in developed countries is widely researched but this problem in the case of public enterprise in Kosovo is less studied. Therefore, objective study includes the analysis of factors that affect the quality governance of public enterprises in Kosovo. The functioning of the board of directors as decision making factorin public enterprises is associated with various problems such as inexperience in policy making, political interference, and conflicts of interest. The paper aims to prove the hypothesis that corporate governance will improve the quality of governance. The paper is based on primary data published by the Policy and Monitoring Unit of Public Enterprises, and Public Enterprises. The paper also exposes some of the challenges that public enterprises face during the implementation of corporate governance. Thus, we will provide recommendations for improving corporate governance in public enterprises.

DOI: 10.5901/ajis.2015.v4n1s2p57