Arnis Sainajs, Chairman of the board of Latvian Post, as well as other board members – Ilze Bagatska, Arnis Gulbis and Egons Strazdins – have submitted their resignations, as confirmed by LP public relations department Gita Valtenberga.
Latvian Transport Ministry has confirmed that Salnajs’ resignation has been received. The ministry refused to comment the reasons behind Salnajs’ decision to leave his post. Nevertheless, the ministry mentioned that a shareholders meeting is planned to take place in the afternoon to decide whether or not to accept the resignation.
Over the course of the past ten years, LP has had seven chairmen.
The current LP board was originally approved on 20 January 2012.
Transport Ministry had appointed Salnajs as acting head of LP’s board in May 2013, after the previous chairman – Maris Kleinbergs – submitted his resignation.
In August 2013, Salnajs was approved in the post of Chairman of the board of LP.
Salnajs’ previous work experience was mostly related to the provision of legal services – he worked in Sorainen and Alfenus legal firms and practised law in Pinsent Curtis Biddle office in the UK.
In 2014, Latvian Post worked with turnover of EUR 61.4 million and revenue of EUR 1.7 million. The company’s financial results for 2015 are currently not available.
Multiple state companies, including LP, have been ordered to form councils before the end of May. Candidate assessment process currently continues in LP.
As it is known, a large number of violations, examples of poor economic management have surfaced recently. All of those problems point to the period of time LP was being managed by Arnis Salnajs.
Among the discovered problems and violations, the inspecting committee found the following: procurements worth up to EUR 15,000 were carried out in a non-transparent way and do not provide signs that goods or services were procured for the best possible price; the management board demonstrated a general lack of commitment to make decisions necessary to ensure uninterrupted economic activity; information passed by the chairman and members of the board verbally to the committee demonstrated significant problems in personnel management matters. In addition, actions and decision of the board further prove that there are serious problems with economic activities and are generally non-transparent and unjustified, as reported by Pietiek.
Explanations provided by board members also demonstrate problems with the organization of work within the management board, lack of competence in managing important matters and structural units. The board has failed to provide a control mechanism for signed contracts. On top of that, members of the board could not even prepare a justified final opinion, which points to a clearly chaotic management of the entire company. This leads to two possible conclusions: a) this approach is beneficial to the board to reduce the possibility of third parties gaining access to contents and progress of decision-making processes; b) the board lacks the competence and professionalism to carry out its duties, the portal writes.
‘The committee believes that the board, in its current composition, is incapable to providing Latvian Post with competent and professional management, make justified decisions and behave as a caring and knowledgeable manager should,’ – the inspecting committee concluded.
Two development options have been identified for this situation – either carry out an in-depth evaluation of each individual member of the board or dismiss the current management board and elect a new one.
At the shareholders meeting it was decided to elect a temporary management board to ensure the uninterrupted management of the company. Marcis Vilcans, Kristaps Krumins and Ilze Aleksandrova will serve as acting members of the board starting from 22 April.
At the same time, Transport Ministry has announced an open personnel selection process to find appropriate replacements for the management board of Latvian Post. More information can be found on Transport Ministry’s website.
According to results of the inspection carried out by TM, the board of LP did not take into account recommendations provided by the State Audit: failed to sort out the payment system for post and calculate the necessary number of service vehicles or their rent.
In addition, the management board’s established work model and decision-making process has created risks for the company’s continued function. Decisions made in relation to procurements were not properly controlled and monitored. In addition, no information about procurement projects was published on the company’s website. The last known entry in relation to procurements was made in 2014, notes the ministry.