Financial and industrial groups: Russian experience

Financial and industrial groups are a number of enterprises, united by a common management structure and a source of lending, in the role of which the bank usually acts. Companies that are part of FIGs do not necessarily represent the interests of a particular industry. They can perform various functions on the market, producing non-conventional products. However, all investments are made from a single source. In addition, FIGs are concerns, sometimes a group of concerns, most of whose shares belong to one individual who determines the development strategy of all enterprises of the association.

Visible autonomy and structure

Formally, from a legal point of view, such enterprises operate autonomously from each other. At the same time, having external management and financing, they form what we used to call "financial-industrial groups". What is typical, despite all apparent autonomy, the companies are oriented towards the fulfillment of a certain task, which may not be directly related to the requirements of growth of economic income. Financial capitalization often occurs due to the concentration of completely different resources.

Financial and industrial groups integrate the efforts of legal, insurance, financial companies, several alternative media resources and, of course, technological production. What can unite them, in addition to the banal desire of the owner to earn a little? Obviously, politics. It's just that certain business development requires not so much judicial and legal as political and instrumental guarantees to preserve the inviolability of accumulated capital. And this is possible only in the case of the transformation of industrial, financial, banking and other types of capital into political capital, that is, into power. Strictly speaking, the activity of any FIG is aimed at solving this problem.

Forms of financial and industrial groups

• Industrial FIGs are industrial associations operating on the principle of a concern. A rare case when such groups include the advantages of an enterprise in one branch of the economy.
• Classical financial and industrial groups - associations created on a contractual basis and as a basic link created a management company. All structural units of FIGs retain their former legal status.

Financial and industrial groups in Russia

In principle, the FIG is a purely Russian phenomenon, which appeared due to the corresponding decree of the RF President in the second half of 1993. Initially, it was assumed that by creating such groups, the state would be able to quickly get rid of a series of unmanageable and by and large loss-making post-Soviet enterprises, and somehow order unhealthy, wild competition by nature. However, the mechanism of creating a FIG did not imply the formation of mechanisms for "friendly integration", which provoked the emergence of super-players, who took a dominant position in various market niches. Thus, instead of a controlled competitive environment, total monopolies were created that controlled entire industries and sectors of the economy. And this, in turn, led to an equally strong dependence of companies on the activities of state structures. It was through the creation of their own political projects that they began to create "necessary" lobbying political and managerial decisions. This was how the monopoly economy was born.