ÖBAG turned five years old this year. Is that a reason to celebrate?
Looking at the results, you can certainly be quite proud. Since our inception, we have paid approximately EUR 5,7 billion in dividends to the budget and increased the value of our portfolio to more than EUR 32 billion.*
And the structure of ÖBAG? Does it deliver what it promised five years ago?
From my perspective, yes, absolutely. ÖBAG has the right structure in place for the here and now. With our small team of experts, we can fully fulfill our statutory mandate. We pursue an active participation approach and contribute to the ongoing development of the companies. Especially in the last two years, we have been able to demonstrate that we have represented Austria's interests very well in our portfolio companies – in the interests of taxpayers, in the interests of the business location, and also in the interests of the Republic's investments.
Where would you like to see ÖBAG in five years?
I am committed to positioning ÖBAG as a stable, essential part of the economic ecosystem and would be delighted if this role of ÖBAG is even more firmly anchored in people's minds in five years.
In your opinion, what are the biggest problems facing the portfolio companies?
I find the question somewhat misleading, because no company has any "construction sites." What they all have in common: They are facing strategic decisions. For some, these were triggered by exogenous factors, such as energy prices following the outbreak of the horrific war in Ukraine. For others, it's changes in the underlying conditions, some of which can be traced back to the COVID-19 pandemic, or to changes in the legal framework, such as the licensing of casinos. But I don't see any construction sites.
When you took office, you held the flag high for corporate governance. What has happened in this area so far?
I think that's a lot. However, this often falls below the threshold of public discussion—at least as long as everything goes well. On the one hand, we've begun to network with our co-investors, the major funds, and the voting proxies. In this way, we also take significant developments in corporate governance at the international level into account and incorporate them into our work. And on the other hand, we have extended or filled a total of 57 supervisory board positions since 2022 without much public discussion. The appointments or extensions of 15 management board mandates also went through without fanfare last year. I see this as a sign that we've done some things right.
How do these occupations work?
The basis for every personnel decision is a qualification matrix that we establish for each supervisory board. Based on this, we – together with a headhunter – search for subject matter experts. It is important to us that they not only contribute the necessary expertise, but also understand that, thanks to a core state shareholder, ÖBAG's portfolio companies pursue more than just profit maximization. The responsibility of this role also makes it attractive to many national and international personalities.
In the interests of Austria as a business location, we are committed to ensuring that our leading companies play a pioneering role in the field of climate and the environment in the country.
Edith Hlawati
And what about the goal of increasing the number of female executives on board – what progress has been made in this regard?
When I look at the ÖBAG portfolio companies, we have 53% female supervisory board members, which is significantly above the Austrian average and far above the statutory quota. I see this as a good basis for further steps. Unfortunately, the situation is still different with executive boards in general, and also with our companies. But there are positive changes here too, as can be seen at OMV, APK, and VERBUND. The executive board is significantly smaller than a supervisory board, and executive board contracts run for significantly longer in this country. Therefore, this will still take time. First and foremost, it's always about the qualifications of the candidates for the positions. What we really want to achieve is a mind shift. This issue should be addressed as a matter of course. That's my goal, and I'm committed to it.
What efforts is ÖBAG making in the area of climate and the environment?
In the interests of Austria as a business location, we are committed to ensuring that our leading companies play a pioneering role in climate and environmental protection within the country. We are devoting significant resources to setting new strategic directions in this area. ÖBAG has been operating a highly detailed CO2 tracking system for several years. This enables us to measure progress across our portfolio and identify areas for action. Between 2019 and 2023, for example, emissions in ÖBAG's investment portfolio fell by 34%.** Compared to the rest of Austria, the ÖBAG portfolio is therefore well positioned in terms of emissions reduction and is making a significant contribution to achieving our climate goals. We have also achieved ESG-specific management compensation that all companies now include environmental and/or social criteria in their short-term and, in some cases, long-term variable compensation. This was not a given until now, but it is an effective lever for initiating and supporting transformations within companies.
ÖBAG is part of the domestic ecosystem at the interface between politics and business. How does that feel?
There's always a lot of outside interpretation. The collaboration between the state owner's representative and us is very professional. I don't sense any interference in the strategic issues of the portfolio companies or in personnel decisions. Of course, I inform my owner about important pending issues. After all, it's the property of the Republic.
How do you assess the performance of ÖBAG’s investments?
All portfolio companies performed well last year – despite challenging conditions. This is also reflected in the very high dividend of approximately EUR 1,67 billion that ÖBAG is paying to the Republic. Therefore, I cannot single out any one company in particular, but would only like to congratulate all the companies in ÖBAG's portfolio, and especially the employees, teams, and management boards behind them, on their performance.
You started with a changed leadership structure and introduced an expanded executive board. Has this proven successful?
In my opinion, the decision-making process within ÖBAG works extremely well. We have an excellent team both at the top management level and at the investment manager level. Through the investment managers and the Supervisory Board, we can contribute our strategic ideas in a targeted manner.
Her appointment was accompanied by criticism that she was an administrator and not a designer.
I think we've been quite active and have made more industrial and location-related policy decisions in the last two years than in the previous three. Extending a syndicate agreement for ten years, spinning off the radio towers into a separate company—also with a ten-year syndicate agreement—and taking the company public are milestones we at ÖBAG are rightly proud of. We shape things through the supervisory boards, because that's where the strategic decisions for our investments are made. And one thing is important for me to say: I speak out publicly, especially when important decisions need to be communicated.
Many thanks for the interview!
The interview with Edith Hlawati appeared in ÖBAG Annual Report 2023.
* ÖBAG dividend to be paid out in 2024
(EUR 930 million and VERBUND dividend in the amount
of EUR 735,31 million).
** 34% refers to Scope 1 and 2 emissions;
Between 2021 and 2022, emissions in the portfolio
decreased by 12,3%, see total emissions
According to the Federal Environment Agency for 2022: -5,9% in Austria.
