Association of Supervisors: Nomination of the Vice-Chairman of the NSI as a director of the Stock Exchange is bad practice

The Slovenian Association of Supervisors has raised concerns over the recent appointment of NSi vice-president Peter Žmak as director of Borzen, stating it represents poor practice and violates the code of conduct set by the State Holding Company (SDH). The association warned that the move contradicts established guidelines meant to ensure integrity and prevent conflicts of interest within state-owned enterprises. The controversy stems from the direct transition of a political figure into a leadership role within a public enterprise without observing the six-month cooling-off period required after leaving political office. This practice, according to the supervisors' association, undermines the autonomy of oversight bodies and compromises the impartiality of decision-making processes. The association emphasized that such appointments should adhere strictly to the OECD’s recommendations aimed at preventing corruption and ensuring transparency in publicly owned entities. In October 2020, the association had already issued a statement regarding similar practices, highlighting the need for strict adherence to the six-month cooling-off rule for candidates with political affiliations. It called for greater scrutiny of individuals who hold positions in political parties before they are considered for roles in state-run organizations. The association argued that these measures were essential to maintaining the independence and effectiveness of supervisory boards. Following this, the association shared its findings with the SDH in March 2021, urging the organization to update its management regulations to reflect these principles. The current SDH Code of Conduct, which came into effect on January 1, 2024, includes provisions that prohibit the nomination of candidates who have held positions in political parties within the past six months. However, the association noted that the newly appointed members of Borzen's supervisory board failed to follow this guideline when they named Žmak as director. The government recently reshaped the supervisory board of Borzen during its first session in early June, appointing new members including Andrej Vizjak, a former minister under Janez Janša; Silva Soka, president of the NSi supervisory board; and Damjan Stank, a former Borzen director and member of the coalition party Democracy. These new supervisors promptly removed Mojca Kert from her position as director and announced the search for a new five-year term director. On the same day, the new board appointed Žmak as director for a two-year term, despite his recent political activity. The decision was made without adhering to the SDH code, which explicitly prohibits the appointment of individuals who have held political roles within the preceding six months. The association pointed out that this breach of protocol could set a dangerous precedent for future appointments in state-owned enterprises.