Only a few months away from presidential elections in late March, the panel on the morning of Jan. 22 at the Ukraine House Davos in Davos, Switzerland, entitled “Character in Leadership,” could have been mistaken for a discussion about candidates for president.
Instead, the topic was how businesses and individuals can influence best business practices and adopt good governance to fuel economic growth in Ukraine.
According to the panelists, there is no doubt that Ukraine has made tremendous progress over the past two decades, even though the general consensus inside of the country is that little has changed.
Jaroslawa Johnson, president of the Western NIS Enterprise fund, explained the paradox: “I’ve been in Ukraine for 25 years, and people always say that nothing has changed because they don’t feel it in their own pockets, or personally – but society has changed a lot.”
Sophia Opatska, the chair of Lviv Business School’s supervisory board, agreed, noting that there have been major changes at Ukrainian companies who “understood that they needed to update their management standards,” and as Johnson chipped in, “make these companies more Western in style.”
And all four panelists agreed that while this eagerness to move forward and catch up with the world is a positive sign, it will still require a major change of mentality within the psyche of Ukrainian businesses and society as a whole.
They also said a shift must be made from focusing on short-term goals and views to long-term visions, which in turn would force all actors to focus more on the substance rather than on the form, or to put it another way – concentrate on product quality, rather than on the packaging.
And that would inevitably entail addressing the elephant in the room: corruption.
Former U.S. Ambassador to Ukraine John Herbst, moderating the panel, attempted to show Ukraine in a good light and soften the corruption factor by citing the good country index designed by panelist Simon Anholt.
According to the index, Ukraine has jumped from 99 to 54 in the world.
Herbst was, however, immediately corrected by Anholt, who said that “what the good country index ranking does not show is anything to do with the business environment within Ukraine.”
“All It shows is that Ukraine is somehow managing to give more to the world outside of its borders than it did before, which is even more important in my opinion, it is a better member of the international community.”
The numbers from Transparency International’s Corruption Index for Ukraine for the last three years – 130, 131, and 130 again out of 180 countries – tell a different story. While the public frequently cites corruption as being a major concern, progress on fighting it appears to have stalled.
Nevertheless, Opatska sounded hopeful in her analysis of the situation, noting changes “after EuroMaidan, (with) people (coming to the school) starting to think more in longer terms.”
Johnson, whose fund has been working in Ukraine since 1995 and invested$187 million into the country, was also cautiously optimistic.
“People in Ukraine are much more sophisticated (now) and have traveled abroad, made contacts with investors of all kinds. The changes have been enormous, (but) of course there still is a long way to go.”
The Ukraine House Davos, which opened on Jan. 21, runs until Jan. 25, at 62 Promenade in Davos, Switzerland. The event was organized by the Ukrainian Venture Capital and Private Equity Association, the Western NIS Enterprise Fund, the Victor Pinchuk Foundation, and Horizon Capital.
