Employee health and mental well-being, as well as attracting and retaining top talent, have risen from third to second and from sixth to fourth place in the list of key challenges facing companies over the past six months, according to a survey of its members by the American Chamber of Commerce (AmCham) in Ukraine.
According to the survey, 70% of respondents mentioned health and psychological issues, up from 65% six months ago, and 56% of top employees, up from 43%.
Employee safety and security remains a key challenge, but its “rating” has dropped from 91% to 85%, while Russia’s missile attacks on critical infrastructure and business assets have dropped from 66% to 61%, moving it to third place.
The challenge of economic and consumer recession has also dropped to fifth from fourth, but 54% of respondents mentioned it, compared to 45% six months ago.
While in early fall, the top five expected problems were access to electricity, water and heat supply, and mobile communications with a 44% share, now it is not even among the top 11.
At the same time, logistics and transportation problems have become a concern for 43% of respondents, up from 30% six months ago, regulatory challenges – 39% instead of 23%, and pressure on business from government agencies – 28% instead of 23%.
Among the top three priority steps that businesses would like to see the government take, the top three are real and effective judicial reform (22%), ensuring a clear and transparent booking procedure (22%), and strengthening national security and defense and de-mining of Ukraine (21%).
Less frequently, company representatives chose to ensure predictability and stability of tax legislation (14%), protect supply chains by addressing the situation with border logistics and maritime transportation (7%), ease currency restrictions on repatriation of dividends and/or payment of interest on foreign loans (6%), and expand insurance coverage of political risks (3%).
According to the survey, 86% of companies are fully operational, 12% of the surveyed companies continue to operate partially, and 2% do not operate at all, while 84% were fully operational six months ago.
58% of all respondents had no damage to their property during the two years of Russia’s full-scale invasion of Ukraine, 7% had their assets occupied, and 30% had their companies’ plants/factories/ facilities/warehouses/offices damaged: 75% of them have minor damage, 25% have irreparable damage.
According to the survey, 84% of AmCham member companies in Ukraine have employees in the Armed Forces of Ukraine. In 31% of companies, employees were wounded, 29% were killed in action, and 2% were missing.
“Despite the difficulties, the business community, inspired by brave defenders, continues to work and believe in Ukraine, supporting the economy, paying taxes and creating jobs for Ukrainians. 86% of member companies are fully operational after two years of full-scale war in Russia. Security and judicial reform are the highest priorities for business,” commented AmCham President Andy Hunder.
The survey, conducted from February 12-22, 2024, involved 125 CEOs and top managers of AmCham member companies.
Implementing rule of law, securing investment and property rights, and establishing a level playing field are among the 10 Priorities for Ukraine’s Post-War Economic Recovery developed by the experts of the American Chamber of Commerce in Ukraine (AmCham Ukraine).
Protection of investors’ rights is at the top of AmCham Ukraine’s agenda, particularly since the onset of the full-fledged invasion when business continuity, economic security, high-quality job creation, and furthering Ukraine’s ongoing resilience is truly a national security priority. This is important now to achieve victory, as well as to set the stage for the biggest economic opportunity since WWII. This will only increase and gain momentum in the months and years ahead thanks to the companies that believe in Ukraine, continue to operate and invest despite Russia’s full-scale war.
Since May 2020, AmCham has provided steadfast support for the establishment of the Office for Protection of Investors’ Rights, led by Oleksiy Boniuk, within the Office of the Prosecutor General (PGO) of Ukraine, spearheaded by Dmytro Verbytskyi, Deputy Prosecutor General. It is imperative that during this period of reform, investors committed to Ukraine may be assured of the country’s commitment to fairness, transparency, a level playing field, and protection of investor rights. Alongside AmCham President Andy Hunder’s efforts, AmCham Ukraine leadership – Chair of AmCham Ukraine Board of Directors, Lenna Koszarny, AmCham Vice President Tetyana Prokopchuk, and AmCham members met with representatives of the Prosecutor General’s Office to review the results achieved since the launch of joint work and identify key priorities for 2024 regarding the protection of investors’ rights.
The key metrics since the beginning of AmCham’s cooperation with the Office for the Protection of Investors’ Rights within the PGO are the following:
“We are determined to take concrete steps and actions so that business in Ukraine works at full capacity, contributes to Ukraine’s ongoing resilience and development, and provides resources for the country’s brave defenders to continue their heroic defense of Ukraine. We are ready to continue to provide a fair, transparent and professional platform to address cases raised by companies committed to openness, transparency, and rule of law, in the format of constructive discussion and evaluation of underlying facts,” stated Dmytro Verbytskyi, Deputy Prosecutor General.
“Ukraine continues on its path of transformation in rule of law, fairness, transparency, and level playing field, ascending twelve places in the 2023 edition of Transparency International’s annual Corruption Perceptions Index – one of the best achievements globally. In addition, in March 2023, for the first time since modern-day Ukraine’s independence in 1991, the country was removed from the list of states where structural changes are taking place that destroy anti-corruption or those where the state of anti-corruption is deemed «globally unsatisfactory» by The Council of Europe Anti-Corruption Body, the Group of States against Corruption (GRECO). Throughout this crucial process of reform, it is imperative that the country’s law-abiding top taxpayers – many of whom are among our 600+ members who have invested over $50 billion in Ukraine – have a platform to turn to in instances where they believe protection of their rights as investors is at issue. We appreciate the cooperation with Mr. Verbytskyi, Mr. Boniuk, and their teams, and the strong results achieved”, said Lenna Koszarny, Chair, AmCham Ukraine Board of Directors.
“After the Department for Investment Protection of the Office of the Prosecutor General began to lead the pre-trial investigation in the criminal case regarding the ACP complaint, there has been a marked improvement in the prospect of bringing to criminal responsibility the beneficial owners of GNT, who illegally dissipated $200 million of assets from the group that borrowed $100 million from US creditors. This department is key to demonstrating Ukraine’s ability to protect investors’ rights”, commented John Patton, Managing Director of London Office, Argentem Creek Partners.
A notable and very successful example of the cooperation of AmCham’s member companies and experts with the Prosecutor General’s Office is the joint work to reduce the scope, nature, and extent of businesses operating in the shadow economy. Specifically, success has been achieved in the field of prevention and the fight against the falsification of medicines in Ukraine. Since 2019 and until today, the Prosecutor General’s Office, in cooperation with the AmCham, has been effectively coordinating the efforts of pre-trial investigation agencies aimed at identifying, investigating, and submitting to the court case materials related to the sale to patients in Ukraine and abroad of falsified oncological, antiviral drugs, drugs for the treatment of rare diseases. At this time, the materials of 2 massive pre-trial investigations have been submitted to the court, according to which those accused of falsification face life imprisonment. Currently, pre-trial investigation is underway in 4 other cases.
AmCham Ukraine values strong cooperation and ongoing dialogue with the PGO and the Office for the Protection of Investors’ Rights and is in the process of expanding this dialogue to other enforcement agencies in Ukraine.
According to the AmCham survey, investors see business expansion as Ukraine’s greatest post-war investment opportunity, but security and rule of law are key.
About the American Chamber of Commerce in Ukraine:
The American Chamber of Commerce is Ukraine’s leading international business association that has been serving 600+ members in Ukraine since 1992, delivering the shared voice of best-in-class US, international, and Ukrainian companies, who invested over $50 billion in Ukraine and remain committed to the country.
The American Chamber of Commerce in Ukraine today announced that Lenna Koszarny, Founding Partner and Chief Executive Officer of Horizon Capital, has been elected Chair of the Board of Directors. The newly elected Vice-Chairs are Alexander McWhorter, Managing Director, Citibank, and Matteo Patrone, Managing Director, Eastern Europe and the Caucasus, EBRD. Iryna Kozlova, General Manager, PepsiCo Ukraine, was elected Treasurer and Serhiy Chorny, Managing Partner, Baker McKenzie, will serve as Secretary & Legal Advisor. This is the first time in AmCham Ukraine’s 26-year history that a female CEO has been elected Chair.
The American Chamber of Commerce in Ukraine represents over 600 members and affiliated parties. Since 1992, the Chamber has been serving investors, multinationals and companies operating in Ukraine. It continues standing up for business, driving actionable dialogue between business and government, continuously creating opportunities for business to business partnerships, and promoting Ukraine internationally as an attractive investment destination.
The AmCham Board of Directors plays a key role in identifying the strategy and the vision of the Chamber based on Members’ priorities and needs. The Directors are actively involved in policy activities, bringing professional expertise and advocating for ease of doing business in Ukraine.
Andy Hunder, President of the American Chamber in Ukraine, runs the executive operations of the Chamber with his team, who report to the Board of Directors.
“I wish to congratulate Lenna and the Executive Committee on this election. This is indeed good news for our members, 74% of whom plan to expand their business in Ukraine in 2019. I look forward to working together with Lenna, the newly-elected Executive Committee and the entire Board throughout an exciting year, serving the members”, commented Andy Hunder, President of the American Chamber of Commerce in Ukraine.
“On behalf of the AmCham Ukraine Board of Directors, I would like to thank Grzegorz Chmielarski, Managing Director of McDonald’s Ukraine, for his leadership as Chair of our Board beginning in 2017. Serving on the Board these past three years, alongside such esteemed members of our community, has been very rewarding. I am humbled and delighted to be elected as Chair and look forward to working together with our Board and President to amplify the country’s success and that of its members, as well as focusing on issues that matter to our members during this crucial year ahead”, said Lenna Koszarny, Chair of the Board of Directors.
Lenna Koszarny, Founding Partner and Chief Executive Officer of Horizon Capital, manages four funds focused on Ukraine and the near region, with over $800 million under management. Born in Canada, Lenna has lived and worked in Ukraine for 25 years. She is a CPA and received her HBA at the Ivey Business School.
