Ljubljana - The Slovenian Directors' Association has joined calls for the withdrawal of the government-sponsored bill that would bring the bulk of state assets onto a new national demographic fund as a means to shore up the pensions system.

The association, which brings together members of supervisory boards, directors, and other corporate governance stakeholders, believes the bill, if passed, would be a major step back in corporate governance.

The association says the bill does not plan for the creation of a demographic fund as an independent autonomous reserve fund, but creates the basis for a new, centralised manager of state equity stakes, transformed from Slovenian Sovereign Holding and by folding in other state asset managers.

This is why the association believes the bill should aim for at least corporate governance standards that apply for banks and insurance companies the fund would manage.

Instead, it says the bill proposes to abandon key established institutes of transparent and effective governance such as vetting procedures and criteria for the appointment of members of the supervisory boards of the demographic fund and of the companies under its control and in the integrity area.

The association argues that key mechanisms of corporate governance of companies managed by the fund should be clearly determined in the bill itself rather than in its articles of governance. "This would be the only way to ensure the fund manages companies in accordance with pre-determined and clear rules."

A call for the bill's withdrawal has also been made by the Pergam association of trade unions, and unions protested that social partners would debate the bill simultaneously with the National Assembly, while issues have also been raised by the country's anti-graft watchdog.

In response Prime Minister Janez Janša promised for the government to consider all good proposals in the creation of the demographic fund, including some of the ideas in a rival bill submitted by the opposition Social Democrats (SD) and Alenka Bratušek Party (SAB).