adminMorris Mpala MOB-Capital (Pvt) Ltd
WE strongly feel board representations in private, public or NGOs sectors should only be limited to two boards only for any Zimbabwean. No persons should be allowed to sit on more than two boards as doing so is the source of corporate governance headaches. It leads to corporate incest, coordinated corporate cannibalism and vulture’s syndrome for self aggrandisement at the expense of owners of capital invested.
We have enough talent to take us to the “Promised Land”, so this monopolistic board representation has to come to an end. We need to be bold in corporate governance issues and send a bold message that we mean business in getting things to work. The need to be sincere in our approach to corporate governance issues must be emphasised. The timid approach won’t help anyone anywhere, anyhow anytime soon.
Limiting board representations is a way of increasing capacity of organisation oversight by allowing so many persons to get involved without monopolising such posts. We have more than three million adults who are capable. Let others get the chance to exhibit unparalleled scholarly skills in the business management arena.
The more people get into boards the more we get fresher and newer ideas as opposed to just parroting the same ideas from one board to the next board meeting without shame and just collecting attendance fees.
Yes, career board membership was once lucrative but these are different times. Simply put, these are hard times, let’s get everyone involved and share the cake of molding firms or drink from many fountains of knowledge.
With board members that can’t embrace technology by employing video conferences as opposed to physical attendances we are in serious trouble as expenses balloon.
It’s the reason why all companies look the same, sound the same tired corporate colours, same strategic plans, perform the same and aspire on the same wavelengths yet we expect dynamism. Isn’t that ironic?
You see or interact with one company you have seen all there is. How do our children learn about business if we have limited business approach by virtue of less board member representation?
It’s too much to ask for one to be on more than two boards from value addition to the time constraints perspective while losing many hours on their respective companies.
I wonder how the late Erich Bloch managed to handle all those board responsibilities. Does one even get to rest at all?
Limiting board representatives also gives income to a wider geographical area thus increasing financial freedom and could lead to wider emancipation and empowerment.
It’s just a numbers game as it dilutes the power/influence in the hands of the limited. As we know too much power and influence vested in a few is very dangerous.
This culture of limited board members has crafted cartels, elitism, monopolies, cronyism, collusions, and anti-trade tendencies to the detriment of the entire population.
Whichever way we look at Cost Benefit Analysis (CBA) no one can sit on more than two boards and do justice to their companies and the boards they represent.
Let’s analyse this current general scenario.
1. In the NGOs sector we have 10 influential directors.
2. In government we have 10 dominating board members.
3. In quasi government boards we have 15 domineering board members.
4. On the stock market we have five major shareholders, which gives rise to under 10 influential directors in the entire public listed companies.
5.Private companies do as they please, let’s just say we have 200 influential directors.
6. Assuming most companies are getting capital from without the company that means the influence is also outside these companies.Their strategies are dotted to the financiers the same way will apply to power/influence. So you will be parroting outside ideas with not much thought from the respective companies.
7. Given that those in public domain double up as private directors in their private lives, decision making becomes biased towards personal interests more than anything else.
The scenario above means the economy is being run by less than 100 people. The challenge comes if these people are not talented enough yet wield so much influence. They will run the economy down. The other downside is knowledge concentration risk. If anything is to happen to these people the economy will be left knowledge bankrupt.
Thus, the need to limit board reps and bring in as many people as possible in decision making during this transformational leadership guidance stage of our communities is critical.
This increases checks and balances besides widening the strategic scope of boards.
Let’s walk the talk and do a bit of sacrifices, meditation to meet our corporate governance targets as business.
We at times blame the government for being anti-business but the government copies and perfects such traits from private companies.
We are not in any way exonerating the government on some of its shortcomings but we’re saying let’s put the blame fair and square where it lies.
No one has a monopoly to impart knowledge to others, let’s limit board representations to help grow our economy.
If other people are afraid to venture into these board rooms thinking it’s reserved for the few the good news is we now have schools offering training in board management.
Morris Mpala is managing director MoB Capital (Pvt) Limited, a microfinance institution offering loans, micro-insurance and advisory services to small to medium enterprises as well as individuals.
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