Conflicts of Interest in State-Owned Corporations: Assessing Eletrobrás and Sabesp

Abstract

Recognizing that corporate governance currently dominates the debate over conflicts of interest in companies, this paper evaluates how the corporate governance debate extends to mixed corporations. The paper undertakes case studies to appraise state-owned companies’ particular dilemmas. Cases studied were the water crisis faced by Sabesp and the renegotiation of public concessions held by the Federal Government through Eletrobras. The cases suggest how the corporate governance of mixed corporations works in action, compared to the hypotheses of the literature. Then, we use our findings to propose a typology of conflicts to explain these cases and other conflicts which may arise in similar state-owned corporations.

Keywords:
Corporate governance; State-owned corporations; Conflicts of interest; Public policy