The Institute of Directors (IoD) Ghana has proposed to government that it no longer appoint Chief Executive Officers (CEOs) of State Owned Enterprises.
It is proposing that instead, the position of CEO in a public enterprise should be advertised, and recruitment done through open and competitive process with the enterprise’s duly constituted Board of Directors empowered to execute the process and ultimately select a competent person for the job
According to the Institute, the current procedure which allows government through the President to appoint CEOs of SOE’s or appoint such people in acting capacities before the Boards of Directors are constituted to confirm their appointment is bad corporate governance practice, which is inimical to the successful management and operations of such enterprises.
IoD has stated that this proposed new appointment procedure, if followed, would contribute immensely to turning state enterprises into better performing, more sustainable entities. The Institute points to the ongoing imbroglio between the Chairman and the CEO of the Ghana National Petroleum Corporation as one unsavory result of such presidential appointments because the CEO would not feel subordinate to his Board, having derived his position from elsewhere.
The Institute as part of its ongoing effort to promote good corporate governance practices across all sectors of the economy yesterday organized a media engagement in Accra. The engagement was meant to establish the role the media should play to promote good corporate governance.
Media representatives from the Goldstreet Business, Ghana Television, Multimedia Group, and New Times Corporation all made commitments to partner IoD in promoting good corporate governance practices.
The representatives all agreed that the media in Ghana has not devoted much attention to the issue and noted that the media also lacks knowledge of good governance practices and appreciation of the benefits of good corporate governance.
During his presentation, Prof. John Bright Ahetor, a former lecturer of University of Ghana Legon said there was the need for Boards of Directors to have basic working knowledge of the elements and functions of their respective organisations.
“There is the need to ensure evaluation in terms of the CEOs, committees of the Board and members”, he reiterated.
In March 2019, the Institute is set to launch Corporate Governance Index (CGI) as a tool to measure compliance of companies and institutions in ensuring best corporate practices. The index will be looking at how stakeholders respond to corporate governance issues in four thematic areas namely ethical culture, good performance, effective controls and legitimacy.
By Dundas Whigham