Government Takes First Step in State-Owned Enterprise Reform

Mongolia has taken its first concrete step towards reforming the governance of its state-owned enterprises (SOEs), signing a Memorandum of Understanding (MoU) on strategic cooperation with Franklin Templeton, one of the world's leading investment management firms. The agreement forms part of a broader reform programme under which the Government aims to consolidate SOEs under the National Investment Fund and list them on domestic and international capital markets by 2027.

The MoU was signed by B. Enkhbayar, Head of the Cabinet Secretariat, and Manraj Sekhon, Chief Executive Officer of Templeton Asset Management and Chief Investment Officer of Templeton Global Investments. 

Franklin Templeton was selected from a wider candidates. The Government sent cooperation proposals to 12 leading global investment management institutions, and Franklin Templeton emerged as the partner of choice after responding with strong interest. The MoU would identify potential areas of collaboration and establish a phased implementation roadmap.

The state-owned sector in numbers

The reform agenda covers a substantial portion of the Mongolian economy. A total of 108 state-owned companies currently operate in Mongolia, employing 60,700 people, with total assets reaching MNT 60 trillion. While some of these companies are of strategic importance and others compete directly in the open market, overall performance remains insufficient in terms of governance, profitability, return on assets, and readiness for international investment.

Governance first, listings second

The Government has made clear that it would not pursue rushed privatisation. Under the reform framework, SOEs would first be evaluated using international methodologies. Only after enhancing their governance, financial standing, and operational readiness would work proceed towards listing them on domestic and global capital markets. In short, the Government intends to bring its companies up to international standards first, and bring them to investors.

Why Franklin Templeton

Franklin Templeton is a global investment management firm with a 75-year history operating in over 30 countries, managing USD 1.78 trillion in assets as of May 2026. The firm brings extensive experience in enhancing SOE governance, preparing companies for capital markets, and attracting international investment, with track records in Romania and the Republic of Uzbekistan. For Mongolia, that experience offers a tested template: both markets saw state-linked assets brought to international investors through structured governance reform.

Watch: Franklin Templeton at the Mongolia Investment Forum

Franklin Templeton's engagement with Mongolia is not new. Marius Dan, Chief Executive Officer for Central Asia at Templeton Global Investments, took the stage at the Mongolia Investment Forum: New York 2026, where he presented on the National Investment Fund. His speech offers an early look at the thinking now formalised in this MoU, and is available here.