The ManicaPost
Nathaniel Mlambo Business Zone
This week on the business zone I would like to tackle the issue of good corporate governance.
I will quote from investopedia “Corporate governance is the system of rules, practices and processes by which a company is directed and controlled. Corporate governance essentially involves balancing the interests of a company’s many stakeholders, such as shareholders, management, customers, suppliers, financiers, government and the community”.
My topic stems from a discussion I had last week on radio with the Acting chairman of the Parliamentary Portfolio Committee on Public Accounts and Finance Honourable Tose Sansole who says most parastatals and Government departments need to improve their corporate governance practice.
This follows the committee’s visit to Manicaland to hear oral evidence from local authorities.
Mr Sansole added that some Government departments and parastatals have not been fully audited for the past three to five years.
He said most audit reports from the auditor general reveal a margin of poor management of public funds by some executives while some governing boards have overstayed beyond their mandate.
He also highlighted the situation in some municipalities of Manicaland saying they are of concern and the committee will be making recommendations for “corrective measures”.
What’s my take
Accountability in any business is key to its own existence, as failure to account will lead to death. We are witnessing this in many parastatals and local authorities. The flag must be raised when an organisation goes for 3 or 5 years without a full audit.
Some organisations will say it’s a waste of money to carry out audits but the main reason in my view is that executives will be dodging accountability.
We know of recent specific audits at City of Mutare which revealed questionable expenditure patterns at the local authority. If the audit had not been carried out, how would the executive been held accountable to the principal?
Internal Audits help organisations to red flag corruption, fraud and flouting of contracts. While all this is not new to any one of us, what disturbs normal sense is the fact that these business principles are not being adhered to and the question I would ask is why?
The answer is simple, executives would like to dodge accountability.
The Public Finance Management Amendment Act, seeks to enhance accountability in the public sector, with financial statements to be submitted every quarter.
The Act also requires accounting officers to explain expenditures and comply with recommendations from the auditor general’s office.
The instruments have been provided generally for corporate governance within and outside of the public sector frame work. Do we lack capacity? Certainly not. Do we lack expertise? Far from it!
The big deal!
The big challenge in my view relates to culture, yes business culture. The business culture we have displayed is against us as Zimbabweans. For our governance to change, we have to alter our mind sets to see value in accountability to our own systems and people.
Executives and leaders have to stop self- enrichment practices through high perks and questionable expenditures or tenders.
This can be achieved by building positive ideas about accountability, Creflo Dollar says: Negative ideas = negative thoughts — negative decisions — negative actions! So we have to mould our systems to encourage thoughts on accountability and we can in-turn push the practise.
That’s all from my desk readers;
Nathaniel Mlambo is a journalist with interest in socio-economic development issues and a producer in training content material.
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