SOEs must adhere to highest corporate governance standards
State-owned Enterprises (SOEs) have been advised to adhere to the highest standards of corporate governance by operating efficiently and continually striving for improvement.
This is because corporate governance is not a mere obligation but a strategic asset, thus, SOEs should ensure transparency, accountability and fairness in management and decision-making.
Additionally, that would help instil investor and public confidence, attract investment and ensure that the whole nation benefited.
The Attorney-General and Minister of Justice, Godfred Yeboah Dame, who gave the advice, was speaking at the second edition of the Public Enterprises League Table (PELT) Awards which was held in Accra yesterday.
The awards was organised by the State Interests and Governance Authority (SIGA), in collaboration with the Public Enterprises Secretariat (PES) and the Ministry of Finance (MoF).
Held on the theme: "Developing the Economic Superhighway through Enhanced Corporate Governance of Specified Entities,” the awards ceremony recognised the most outstanding specified entities based on the evaluation of the Annual Performance Contract they signed with the government.
The Food and Drugs Authority (FDA) took home the ultimate award as the Entity of the Year
It also won the SOE of the Year and Most Innovative SOE of the Year.
Other awardees were the Civil Aviation Authority (SOE of the Year), the Ghana Metrological Agency (Most Efficient SOE of the Year); the Ghana Airports Company Ltd (Most Profitable SOE of the Year) and the Ghana National Petroleum Corporation (Most Compliant SOE of the Year).
The rest are the Northern Electricity Development Company Ltd (Best SOE in Dynamic Effect); the Ghana Irrigation Development Authority (Most Compliant SOE) and the Gaming Commission of Ghana (Most Financially Sustainable SOE).
Mr Dame further urged the entities to recognise the importance of working within the confines of the Public Financial Management Regulation 2019 (L.I. 2378) which brings clarity to processes and functions outlined in the Public Financial Management Act, 2016 (Act 921).
He said those laws set a high standard for accountability and performance measurement in the public sector.
Also, he explained that they provided a framework that ensured prudent financial management, transparency and the efficient use of public resources.
“Therefore, it is imperative for Specified Entities to operate within the confines of the laws to be able to demonstrate good corporate governance culture.
Godfred Yeboah Dame, Attorney General and Minister of Justice, addressing the ceremony
“The boards of specified entities bear the responsibility of ensuring that the mandates of their entities are fulfilled.
By so doing, there is assurance that as fiduciaries, the interest of their principals, which are the people of Ghana, are held and promoted, “Mr Dame stressed.
Collaboration with SIGA
The Attorney-General also emphasised his resolve to work closely with the State Interests and Governance Authority (SIGA) to fulfil its vital mandate since the latter played a crucial role in overseeing and coordinating the government's interests in SOEs.
Through the collaboration with SIGA, he said they would create an environment where Specified Entities could thrive, make substantial contributions to the economy and uphold the principles of good corporate governance.
He further gave an assurance that his ministry would continue to strengthen the legal and regulatory framework governing those entities to ensure that they operated with integrity, transparency and accountability.
Improved performance of SOEs
The Director-General of SIGA, Edward Boateng, said since the launch of the awards last year, a notable transformation had occurred in the discourse surrounding state entities.
He said the discussions were rapidly shifting from concerns about non-performance to accounts of improved performance and efficiency.
He said the shift was not merely anecdotal but was substantiated by empirical evidence, indicating that there was a substantial rise in average scores between the 2020 and 2021 Performance Contract evaluations.
Mr Boateng said on the 5-point scoring system used to gauge the performance of SOEs, 64 enterprises achieved an overall average performance index score of 2.737 during the 2021 Performance Contract Evaluation.
Although the performance is still below average on the 5-point scoring scale, he said it represented a marginal improvement of some 6.65 per cent compared to the preceding fiscal year's average score of 2.566, involving 50 SOEs.