Adhere to corporate governance code: Gadzikwa

0
1431
Eve Gadzikwa

STANDARDS Association of Zimbabwe director-general, Eve Gadzikwa has challenged the public and private sector to adhere to the corporate governance code, as it is key to economy growth.

BY TARISAI MANDIZHA

The National Code on Corporate Governance of Zimbabwe (NCCG) was launched in April this year. It seeks to provide mechanisms for both private and public sectors of the economy to be governed.

Speaking at the Institute of Chartered Accountants of Zimbabwe chief finance officers (CFO) forum in Harare last week, Gadzikwa said the events of past five years have brought corporate leadership into the spotlight, both private and public sector, and there is need to instill discipline within private and public sectors.

Dr Eve Gadzikwa - Pictures by Kudakwashe Hunda
Dr Eve Gadzikwa – Pictures by Kudakwashe Hunda

“Corporate governance is concerned with holding the balance between economic and social goals and between individual and communal goals. The governance framework is there to encourage the efficient use of resources and equally requires accountability for the stewardship of those resources,” she said.

“The aim is to align as nearly as possible the interests of individuals, corporations and society.”

Gadzikwa encouraged corporates to take advantage of the National Code on Corporate Governance of Zimbabwe (NCCG) saying it complements existing statutes.

She said the Zimbabwe Stock Exchange pressed for governance codes to enhance the reputation of markets and member companies to attract capital.

Gadzikwa said the separation of ownership and control was, therefore, the hallmark of the modern co-operation as it would be impossible for dispersed owners of public companies to manage the company’s business and affairs.

“Good governance benefits companies, both small and large. Shareholders can expect as much accountability from a board of a small company as they can from a large company.

“The board relationship with management in both large and small companies is critical for healthy governance. What is required is common understanding of each other’s roles and mutual respect for each party to carry out their responsibilities,” she said, adding that continued open dialogue and strong leadership within the board was key to company performance and economic growth
Independent board members, Gadzikwa said, must have the capacity to fulfil their duties independent of management, delegate authority to management and monitor progress. Management must be free to manage without interference, she said.