The majority of SOEs also publish their audited accounts. Eighty percent of the companies that publish their audited accounts use their website and other means such as newspapers and other printed publications. Only 10 companies out of our total sample do not publish their audited accounts.

_Composition of the Board:_ Only 7 percent of the Boards have a member withdrawn from these sectors. Moreover, in a very small percentage (15 percent) of the cases, Board members are either appointed through the intervention of the Parliament or by the private sector (i.e. professional and experts).

_Mechanisms to select the company’s staff:_ We also considered the selection and appointment of the staff of the enterprise. Selection mechanisms show three main approaches: i) external competition; ii) internal selection process; and iii) discretional appointment. External competition is more frequent in the selection of skilled workers and less common in managers, unskilled labor, and non-operational workers.

# **COMPONENT 5: PERFORMANCE ORIENTATION**

This component addresses the existence of mechanisms to evaluate the performance of SOEs. We intend to identify those arrangements that allow for a performance-based management of the enterprise. In other words, a management that is oriented towards the fulfillment, and achievement, of objectives and goals. We believe this is one, among many, of the ways of increasing state companies’ accountability, particularly because of its orientation towards results. A performance oriented management, if properly implemented, would facilitate the identification of objectives and, consequently the efficiency of the company. This is particularly the case in SOEs, where incentives for performance are difficult to create.

We asked companies about mechanisms to evaluate: i) the performance of the enterprise; ii) the performance of the members of the Board; iii) the performance of the CEO; and iv) the performance of the rest of the management. The Performance Index reflects the mechanisms that exist at these four levels. We structure our analysis of performance orientation in SOEs through three dimensions. The first dimension is related to the process of setting objectives. The second dimension is related to the instruments used to set objectives and its enforcement. The third dimension is related to the authority that conducts these assessments.

_Objective setting:_ The answers from the SOEs were not sufficiently clear about the ways performance objectives are established. The majority of responses focused on the instruments through which evaluation takes place. A few, though, were explicit about targets and the process of identification and establishment.

State companies in the Dominican Republic are under the authority of the DR Corporation of Electricity Companies, a holding responsible for the ownership of public companies in the electricity sector. ELECTROSUR, one of DR state corporations, agrees on different objectives depending on the government unit. For instance, it discusses objectives related to coverage and quality of service with the government, efficiency and revenues issues with the holding company, and within the company issues related to work-related accidents, environment protection, etc.

Colombia presents a different approach to objectives’ setting. The control agency (Superintendencia de Servicios Públicos Domiciliarios) requires utilities to prepare different plans (finance, strategic, action) based on pre-selected criteria and indicators. The evaluation of 13