Monday 20 November 2017

Parastatals need complete overhaul

Parastatals need complete overhaul
(News Day 09/12/17)

In response to Mugabe to blame for parastatal mess: ZCTU: Your report that the Zimbabwe Congress of Trade Unions (ZCTU) blames President Robert Mugabe for the collapse of State-owned companies is spot-on.

Mugabe has been the chief executive officer (CEO) of the country for the past 37 years during which time the rot has sunk in.

But the ZCTU should not entirely escape blame. They have been quiet on corporate governance issues at the workplaces, including State enterprises, to this day.

I hope the unions are going over the Corporate Governance Bill before it is passed into law.

They should insist on 12-person boards of directors of which three non-executive directors are appointed by workers, one of whom should be a seasoned lawyer and another a chartered accountant.

The latter should chair the finance and audit committee of the board.

In addition, there should be three executive directors – the general manager/CEO, the finance director and the operations or technical director.

The minister may appoint six directors, with the board itself electing the board chair and deputy from within its non-executive director ranks by way of a secret ballot, provided if the chair is a ministerial appointee, the deputy is a workers’ appointee or vice versa.

This process will reduce corruption and nepotism in board appointments.

Ministers have to date wrecked the economy and parastatals. Boards of directors should not be dissolved willy-nilly, but renewed every three years with the retirement of at least two to four of the non-executive board members to be replaced by new blood.

Board terms should be limited to not more than three-year terms, while the CEO should have one 12-year term, with a three-year probation period.

There is more that needs to be done to stop the rot in parastatals that is short of a complete overhaul.

Justice Takesure

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