Improving the Role of Eximbanks/ECAs in the OIC Member States
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4.4.2. Governance
Sound governance arrangements are vital to the success of the ECA. Similar to its financial
relations, an entity’s relationship with the government in the governance sphere is influenced by
the shareholding status of the government.
A government’s role in these entities varies depending on the entity’s corporate form and its
shareholding status. In the case of fully and partially government-owned ECAs, governments are
typically represented on the entity’s Board of Directors and play a significant role in governance
and, sometimes, in the general management of the entity.
Mixed state/private companies, corporations and variations of these entities may have direct or
indirect government ownership, as well as Board membership and a substantive role in the
governance of the entity. The degree of government influence, however, may vary. In the case of
Jordan’s JLGC, the Central Bank of Jordan is only able to appoint two members to the board
(including the Chairman) as long as its capital contributions remain above 45 percent. Malaysia’s
MEXIM, a public limited liability company, only has one nominee of the Ministry of Finance
Incorporated among its Board members, the majority of whom are independent individuals with
no government affiliations.
The majority of state-owned corporations are governed by Boards that are entirely made up of
representatives from government agencies as in the case of UAE’s ECIE, whose governance is
overseen by the prime minister of UAE and the Ruler of Dubai. Others may include Board
members from the private sector. Nigeria’s NEXIM has one representative from the private
sector, while Turk Eximbank, Indonesia’s EXIMBANK and Bangladesh’s SBC have several
independent members sitting on their respective Boards.
There are some ECAs that operate as programs and funds under a specific government agency
and, as a result, the agency’s management oversees its governance. These agencies may, in some
cases, include representatives from the private sector to sit on the Board of these entities, as in
the case of Saudi Arabia’s SEP which fall under the Saudi Fund for Development and Albania’s
ECGF which has been managed by Albania Investment Development Agency.
In terms of governance structures, some ECAs are under the banking or insurance supervision of
their countries, requiring them to be compliant with capital adequacy and solvency
requirements as any commercial bank or insurer. EDBI of Iran and EDBE of Egypt, as both
deposit-taking organizations, are under the supervision of their Central Banks, while ECIE of the
UAE and KazExportGuarantee are under the supervision of the insurance authority.
A key element of sound governance is a requirement for the ECA the publication of annual
reports and financial accounts on a timely basis. While the privately held companies may not
publish their accounts, there is mixed experience amongst the government backed ECAs. Some
simply have no information available on their performance, while others maintain regular
quarterly updates, such as Malaysia EXIM. By contrast, Nigeria EXIM has not updated its
information since 2010. Sudan’s NAIFE has a sound governance model but scant information
available to assess the impact of this on the business.
4.4.3. Policy
Governments create ECAs for public policy purposes and may wish to exercise direct and
indirect influence over the policy decisions and operations of their ECA. The policy relationships