The CMB ceased the duties of Mehmet Bulent Ergin, Tero Kivisaari and Oleg Malis and replaced them by three independent board members of its discretion due to Turkcell’s failure to comply with the corporate governance regulations.
The independent board members appointed by the CMB are Ahmet Akca, Atilla Koc and Mehmet Hilmi Guler. The term of duty of the CMB appointees is until Turkcell duly appoints its own set of independent board members as described under the CMB regulations. The CMB also instructed Turkcell to change its articles of association to comply with the new regulations.
The CMB has repeatedly requested that Turkcell should increase the number of independent directors on the board and has also implemented regulations, applicable to all Turkish listed companies, to that effect. These requests have been clearly supported by TeliaSonera. For years, TeliaSonera argued that the number of independent board members has to increase in order to improve corporate governance and follow requirements by the CMB and the US Securities and Exchange Commission.
However, any attempts to increase the number of independent directors have been effectively blocked by Cukurova exercising its veto right through Cukurova Telekom Holding, a structure put in place to enable a minority shareholder to block majority decisions.
An international company like Turkcell, listed in both Istanbul and New York, has to adhere to international standards of corporate governance and transparency to be an attractive target of international investments, TeliaSonera stated.
