When business is politics
As Western governments become owners of large banking companies, here's a reminder of how politics and governance can affect corporate governance. And when it comes to mixing politics and business, don't forget the jailed Russian businessman Mikhail Khodorkovsky, the most famous of several jailed oligarchs.Aeroflot Faces a Politically Connected Rival
"Aeroflot, the national airline of the Soviet Union and now Russia... has suddenly fallen from first place among Russian state-owned airlines, at least as measured by the number of aircraft in its fleet...
"A series of bankruptcies of regional airlines brought the change... In response, the government of Prime Minister Vladimir V. Putin orchestrated a merger of 11 regional carriers...
Both Aeroflot and the new company are majority-owned by the state but appear to be backed by different factions in the government...
"Aeroflot... is closely associated with the out-of-favor administration of former President Boris N. Yeltsin; the chief executive, Valery Okulov, is a son-in-law of Mr. Yeltsin, and a 25 percent shareholder. The tycoon Aleksandr Y. Lebedev [right], who owns 30 percent of Aeroflot, has a prickly relationship with the current government. "Not surprisingly, the new company has powerful backers.
"It is 50 percent owned by the city of Moscow and 50 percent by one of the heavyweights of the new blend of state and private business that emerged under Mr. Putin, Sergei V. Chemezov [lower right], a former K.G.B. colleague of Mr. Putin...
"And in a sign of the new owners’ influence... Yuri M. Luzhkov, the mayor of Moscow, and Mr. Chemezov have asked state regulators to halt fees of $300 million a year paid to Aeroflot... contending the fees provide the flag carrier an unfair advantage."The rivalry is also personal; Mr. Lebedev, a critic of Mr. Luzhkov’s management of Moscow, has run against Mr. Luzhkov for mayor..."
Labels: economics, political culture, politics, Russia
posted by Ken Wedding @ 6:03 AM
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