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Dr Sibanda

Business Reporter
The Attorney General’s office has started drafting regulations that will facilitate implementation of the Public Entities Corporate Governance Act, whose Bill is currently before Parliament. The regulations are designed to end a culture of impunity, abuse of resources and mismanagement of State entities. Chief Secretary to the President and Cabinet, Dr Misheck Sibanda, recently said that the Public Entities Corporate Governance Bill is expected to be passed by the end of the current Parliamentary session and this has raised hope within Government and private sector that legislation will improve performance of public entities.

“The Bill itself is very detailed; it will be accompanied by a set of implementation regulations currently being drafted by the Attorney General’s Office. In this regard, I have already encouraged and advised heads of ministries, board chairpersons CEOs to familiarise with contents of this impending regulation. This is meant to facilitate and enhance oversight and more effective compliance with requirements of the Bill,” he said. Already, Government has developed implementation guidelines on board effectiveness and performance management for State enterprises and parastatals.

Dr Sibanda said the manuals, derived from the Bill, reflected international practices and are designed to assist line ministries and entities in the implementation of key components of good corporate governance. The poor performance of State entities, which Dr Sibanda attributed to weak or absence of good corporate Governance practices, had seen their contribution, which previously stood at 40 percent of gross domestic product, plummeting to 2 percent while they continued to rely on Treasury for funding. About 70 percent of 93 surveyed state entities were technically insolvent. Thirty eight of the entities surveyed ran losses totalling $270 million in 2016.

Meanwhile, most public entities had continued to operate without enough skilled manpower, recommended board committees, or the boards themselves, while the entities management had no performance targets or appraisals. The Public Entities Corporate Governance Bill requires the State entities to adhere to prescribed reporting requirements time-frames and a host of accountability obligations in addressing the malaise obtaining State owned entities. The Bill will foster transparency, accountability and more disclosures, requiring management to report correctly and regularly the activities of state entities.