Business Reporter THE Institute of Directors Zimbabwe (IoDZ) has said that corporate governance in the private sector needs to be improved to raise the quality and standard of directorship in order to guard against mediocre leadership.
Addressing delegates at the recent launch of IoDZ’s inaugural State of Corporate Governance Survey in Zimbabwe in Harare, IoDZ chairperson Mike Juru called for policy reforms which he said were critical to remould governance, sharpen and clean-up directorship while restoring sanity in the corporate world.
Juru noted the positive developments in the sector as well as the need for policy reforms.
He said it was critical that corporate governance reforms bring about a consistent framework to deal with directorship, noting that the current setup was fragmented.
“The government has its corporate governance Unit supported by the Public Entities Corporate Governance Act and Companies Act over and above sectoral regulators,” Juru noted .
“The private sector on the other hand, outside the Companies Act and the sectoral regulators, there is no (regulatory) body checking governance observations or omissions.”
Juru decried the absence of regulatory systems such as those monitoring accumulation of personal wealth which he said aided corruption and outright theft.
“The government system takes critical director disclosure expectations to another level as it consistently requires directors to declare their assets, upon appointment, annually and at end of term. It would be good if the same is done in the private sector to address corruption and unjust wealth accumulation,” Juru said.
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He said the composition of boards needed to consider key issues such as age, gender, skills and board experience.
Board succession and term limits need robust and open discussion with set policies being observed religiously, he added
“It is common to see a board easily being an old boys club with same age members with similar qualifications and experiences on the same board,” Juru said.
He added that the virtual absence of recognised acceptable standards of director competency was regrettable as this compromised board leadership competency.
There was a need, he said, to drive policy towards accommodating these quality monitoring measures.
“The pensions sector should be applauded for insisting that any pension fund board member (Trustee) is required to hold a minimum of a Certificate of Proficiency which is examinable with a pass mark of 70%. That requires it to be made standard across all sectors,” Juru said.
The event, which was sponsored by Old Mutual and MMCZ, was attended by a host of directors from both the private and public sector .
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