FOR IMMEDIATE RELEASE
February 2004

Russian Ministry of State Properties Seeks Chicago Firm’s Advice on Top Management Supervision

With over two million employees under its supervision, the Russian Ministry of State Properties in Moscow retains a controlling interest in a range of key Russian "blue chip" companies, including the National Electric Utility, as well as the National Rail Corporation. Because of its significant financial and political stake in these corporations, the Ministry recently brought in the Chicago Process Management Group (CPMG), a U.S. based expert on work process management, to identify ways to monitor as well as manage top management in their key utility and transportation sectors.

Russia has long recognized the need for trained business leaders to manage key corporations, including those companies managing the national utilities grid. In 1992 the country’s former Minister of the Economy, Eugeny Yassin, established a new university, the Higher School of Economics, focused on the development and training of Russian business leaders. As a result, the university’s Graduate Management School has developed a Russian management system -- relying on the US’s CPMG as its exclusive process management partner. The school’s graduates have now taken the lead in directing the country’s emergence as a leader in the global market economy.

However, a critical issue has become the process, as well as criteria that Russian Boards of Directors in these companies should use in assessing and evaluating the performance of their top managers.

At a recent roundtable meeting in Moscow of key government and university officials as well as leading Russian utility managers, CPMG provided the forum with the most effective methods not only of management and Board of Director interaction, but with specific indicators of performance, or "Operational Key Process Indicators" that are of board-level relevance.

"Having an informed and engaged Board of Directors is fundamental to corporate success," said Bruce Marshall, CPMG Managing Partner. "Our goal is to support the Ministry, as well as the Higher School in final development of a Russian standardized system, one in which board members will know what criteria to look at, as well as the forum they need to establish in order to evaluate performance."

Dr. Gennady Konstantinov, head of the Corporate Governance Center of the Higher School of Economics, commented, "For any Board of Directors to be truly in charge of a company they need to see and understand the core reality of how the company operates. That’s why we brought in CPMG -- because they know the process of getting work done better than any other firm we know. And they have invaluable experience of working in the very complex Russian environment."

A follow-up meeting will be held with the Ministry and CPMG to discuss development of a standardized Board of Director training for Russian companies.

In the U.S., the focus of CPMG has been to evaluate existing work process infrastructures and then to deliver high-value outcomes for limited effort, using an ROI of 5:1 as their approach basis. Key to the company’s success is their combination of work process experts and unique database improvement results from over 250 "FORTUNE 500" companies.

For more information contact: Mary Stibal, VP Business Development and Communications, 617.794.6200