Petrobras initiates board changes with weakened governance

Just over two months after taking office, Petrobras president Caio Paes de Andrade began changes to the board, with a governance system more aligned with the federal government at the helm, which should reduce resistance to his nominees.

The first change will be in the Digital Transformation and Innovation board, with a name that was already expected by the market: Paulo Palaia, who has already held this role at Gol. The executive, who will replace Juliano Dantas, is appointed as an indication by the President of the Republic, Jair Bolsonaro (PL).

His appointment still depends on the analysis of the internal committee responsible for evaluating CVs and any restrictions imposed by the State-Owned Companies Law for holders of positions in the company’s senior management. This committee, however, was weakened by the change in the company’s board of directors.

A focus of resistance to previous appointments, when it was chaired by representatives of minority shareholders, the People’s Committee is now made up mostly of federal government appointees, all of whom hold public office.

In the vacancies reserved for councilors, there are National Treasury attorney Iêda Cagni, the president of CEB (Companhia Energética de Brasília), Edison Garcia, and the president of Serpro, Gileno Gurjão Barreto, who also heads the state-owned company’s board.

They replace Ruy Flacks Schneider and Luiz Henrique Caroli, who left the board of directors, and the lawyer Francisco Petros, elected by minority shareholders and one of the main dissenting voices in the company’s top management.

The two external committee members, Tales Bronzato and Ana Silvia Corso Matte, remain. Matte was already nominated by the government to compose the company’s board of directors in 2021, when Bolsonaro’s lists had more independent names, but she ended up not being elected.

The new composition of the People Committee is seen internally as part of the strategy to undermine resistance to political appointments in the company, after a series of opinions and votes against those appointed by the government.

In the last election to the board, for example, the committee decided that potential conflicts of interest prevented the appointments of the executive secretary of the Civil House, Jonathas Assunção, and the attorney general of the National Treasury, Ricardo Soriano.

The assessment was corroborated by the company’s board of directors, which removed the two names from the list of candidates, but disregarded by the government. The two ended up being elected with the votes of the Union in assembly on August 19.

The very name of Paes de Andrade was resisted by the committee, as the executive did not have the experience required by the State-owned Companies Law in companies in the same sector or same size as Petrobras.

His first nomination to the board has. Having worked at companies such as Gol, Webjet, Dasa and CVC, Palaia has a degree in data processing from Universidade Braz Cubas and has a degree in Strategic Management of IT (Information Technology) from University of Berkeley, California.

According to sources close to the company, Paes de Andrade plans to make a complete renovation of the board, with changes also in management positions. He has the backing of Bolsonaro, who has publicly defended broader changes at the helm of Petrobras.

Some of the names circulating as likely new directors are already in advisory positions at the company. Fernando Moura, advisor to the company’s presidency since Paes de Andrade took office, for example, is listed for the Governance board.

Internal resistance to political appointments also became the target of the center: in April, after appearing against the appointment of consultant Adriano Pires to the company’s command, the mayor, Arthur Lira (PP-AL), came to propose changes in the Law on state.