Corporate governance
The corporate governance system is increasingly becoming one of the key factors that plays a decisive role for companies in achieving their strategic goals. This approach serves to uphold not only business goals, but also values such as social responsibility, environmental sustainability and transparency.
As AZCON, our goal is to upgrade the performance of state-owned enterprises, create long-term value by ensuring the efficient management of state-owned enterprises to improve their economic efficiency and generate more revenues for the state budget, and to establish a sustainable development model based on the principles of transparency and accountability in management. Our systematic and integrated approach to corporate governance enables state-owned enterprises to operate more effectively and in line with national development priorities.
The legal and institutional framework set up by the AZCON Charter approved by the Decree No. 286 of the President of the Republic of Azerbaijan dated January 15, 2025, allows for systematic and targeted support for addressing the main challenges faced by the state-owned enterprises under the Holding.
AZCON's main corporate governance priorities
Development of state-owned enterprises and oversight of their activities:
- Operation and management of state-owned enterprises in accordance with national priorities, including the creation of opportunities for mutual synergy;
- Oversight of the state-owned enterprises’ activities and sustainable development;
- Allocation of resources and funds across state-owned enterprises.
Application of common governance principles:
- Effective management system upgrade;
- Development of incentive mechanisms for governing bodies;
- Implementation of internal control mechanisms and audits.
Human resources management:
- Establishment and improvement of human resources potential in state-owned enterprises;
- Creation of competence centers.
Partnerships and funding:
- Establishment of joint ventures and partnerships;
- Attracting external funding at the state-owned enterprise and Holding level.
Prepare state-owned enterprises for privatization:
- Creation of transparent and attractive environment for potential investors;
- Adaptation of the legal and institutional framework to privatization requirements.
AZCON's development and financial priorities
Focus on development
AZCON's main strategy is to ensure the long-term development of the state-owned enterprises under its management. This approach also includes the implementation of investment and development plans in line with the national economic priorities.
Focus on profitability
At the same time, AZCON implements commercial strategies in line with the relevant sector and market requirements to ensure sustainable financial profitability of state-owned enterprises. This is accompanied by both the efficient use of internal resources and increased access to new markets.
Sustainability and accountability in governance
Transparency, accountability, and ethical behavior are adopted as basic principles in AZCON's activities. The Holding’s corporate governance model ensures effective interaction between supervisory boards and executive bodies, enabling decisions to be made on a flexible and strategic basis.
The corporate governance model formed by AZCON is aimed at ensuring the efficient and responsible management of state-owned enterprises, as well as increasing long-term national economic value and ensuring sustainable development.
Risk management at AZCON
Risk management is of particular importance in AZCON's operations. Holding’s organizational risk management framework and policy ensure a unified, structured, proactive and consistent approach to managing all types of risks, based on international best practices and standards. The main goal of effective risk management in AZCON is to create long-term value by implementing advanced corporate governance standards, ensuring resilience to uncertainties, increasing stakeholder trust, and promoting informed decision-making. The following principles lie at the heart of our organizational risk management framework and policy:
Compliance with a unified strategy
Risk assessment results are considered at all stages of strategy and decision-making.
Healthy risk culture
A healthy environment is promoted where risk management responsibilities are clearly understood, and every employee contributes to risk management.
Being proactive
Using advanced methodologies, tools, and technologies, risks are identified and assessed in a timely manner, appropriate response strategies are developed and regularly monitored.
Sustainability
The ability to be resilient to negative and unexpected events, to restore operations as quickly as possible, and to adapt to changing conditions is increased. Systematic approaches are applied to manage and adequately respond to crisis situations, and comprehensive plans are developed to continue critical operations in the event of a crisis.
Communication and transparency
All potential risks are communicated to relevant stakeholders of the enterprise in a timely, complete and transparent manner to enable effective, informed decision-making.
Integrative and centralized risk management
The risk management model is built with a unified approach across all businesses and processes. All functions across the enterprise perform the stages of risk identification, assessment, and management based on the same method and framework. The organization of risk management is based on a centralized management model. This model ensures that the risk management process is carried out in a unified manner at all levels of the enterprise by developing a framework, policies, standards, and methods for the organizational risk management function.