Chapter 2 shows that the Russian reforms established a small number of oligarchs and concentrated enormous riches in the hands of a few. However, it did not contribute to effective management of business and did not make the enterprises attractive to investors. The chapter reveals that the largest private owners and their financial-industrial groups control enterprises in a number of strategic sectors. The process of accumulation is often dependent upon stock market growth, commodity price inflation and leverage. The chapter discloses that oligarch business is unsustainable because it is

not backed by investment in the modernisation of production, labour productivity growth or development of small and medium-sized businesses. The government implements nationalisation only when the owners are not included in its ‘favourites’ group or when they have inappropriate behaviour. The Russian authority does everything for preserving and strengthening the oligarchs’ ownership structure.