Political will key to governance code

via Political will key to governance code – The Zimbabwe Independent June 6, 2014 by Herbert Moyo

LAST week’s media reports that government had joined hands with the private sector to craft the National Code of Corporate Governance aimed at providing a “holistic solution to corporate failure and poor corporate governance” will not necessarily be sweet music to ordinary Zimbabweans now accustomed to their government’s propensity for rhetoric at the expense of action.

Zimbabwe has a well-documented history of crafting well-intentioned policy documents including the ruling party Zanu PF’s leadership code of 1984 (which banned party members from owning businesses and property), and more recently the Corporate Governance Framework launched during the tenure of the unity government comprising Zanu PF and the MDC formations from 2009 to 2013.

“Party officials shall not own a business, a share or an interest in a business organised for profit; provided that this shall not be interpreted as prohibiting such petty side-line activities as chicken runs, small plots and gardens on one’s residential property,” reads part of the Zanu PF code of the heady early years of Independence when socialism was still en vogue.

Other prohibitions in the code included receiving more than one salary and owning more than 50 acres of land.

While these were highly ambitious and difficult to sustain they at least demonstrate a Zanu PF whose ethos and ideology is in stark contrast to the rapacity of the present-day party where multiple farm ownership, including by the first family, are the order of the day.

This is in flagrant disregard of the party’s one man, one farm policy.

The Zanu PF government seemed so serious about fighting corruption that then party heavyweights like the late Maurice Nyagumbo, Frederick Shava, Callistus Ndlovu and the late Enos Nkala were hauled before a commission of inquiry led by then judge president Wilson Sandura and subsequently lost their ministerial posts.

The ministers were fingered in abuse of their offices in the buying of cars from Willowvale car assembly before re-selling them at exorbitant prices for profit.

This, and subsequent documents including the latest code, have all identified corruption and personal enrichment as the key impediments to getting parastatals and state enterprises (SEPs) to start contributing substantially to economic and social development in the country, instead of haemorrhaging the fiscus.

Given this scenario the question is: what exactly is new in this governance code glowingly described as the “first of its kind” by the state media?

Even if, as expected, it is launched by President Robert Mugabe — what will it do which the code launched by former State Enterprises and Parastatals minister Gorden Moyo failed to do?

Moyo launched the Corporate Governance Framework (CGF) in 2010 for adoption by line ministries in an attempt to turn around the operations of SEPs. The CGF provides step-by-step procedures, including consultations and consensus among key stakeholders in the appointments of board members, culminating in cabinet approval.

To its credit, the code also acknowledges that appointments to public office must be made primarily on merit and measures should be taken to expose, combat and eradicate corruption and abuse of office.

But as analysts point out, it can only work when implemented and for that to happen there must be political will which has generally been absent in government.

The code came to naught perhaps because as political commentator Godwin Phiri observed, “It was launched amid political bickering in the inclusive government where Zanu PF and its MDC coalition partners sought to undermine each other’s efforts.”

“The proof of the pudding will be in the eating but the code may well lead to concrete action because it has been crafted by a Zanu PF government which has also been very vocal against its own in exposing corruption,” said Phiri.

“We need to give the government the benefit of doubt this time around. The economy is bleeding from various causes chief of which is the scourge of corruption in the parastatals and civil service. The Zanu PF government does not want the economy to totally collapse and ruin Mugabe’s legacy.”

But does the government have the will or the spine to enforce some of the code’s key recommendations including meritocracy in the appointment of public officials and parastatal bosses, given Mugabe has widely been accused of using a patronage system to maintain his stranglehold on the party and country.

Military personnel currently sit on many parastatals boards; in fact, the Zanu PF party’s central committee report to its 14th annual people’s conference held in Chinhoyi last December contains proposals to staff key parastatals like the National Indigenisation and Economic Empowerment Board with “people with the relevant political will”.

Exasperated by what he believed to be the partisan appointments of military officials, Moyo claimed his ministry had even prepared what he called a data base of competent Zimbabwean professionals for consideration by line ministers for appointment to executive and parastatals boards.

But beyond crafting a sound code, government will have to take it a step further through legislation to give it legal force.

Zimbabwe Environmental Lawyers Association director Mutuso Dhliwayo said the new code should only be seen as nothing more than “a statement of intent”, which is not legally binding.

“Hopefully the government will proceed to have it legislated so that it can have full legal effect,” he said.

SEPs, which have the potential to contribute 40% to the country’s Gross Domestic Product (GDP), can only make a meaningful contribution when run professionally and not the current shadowy approach where appointments are made on partisan grounds, and bosses are paid outrageous salaries when their entities are broke and constantly bailed out by the fiscus.