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Panganai Kahuni
Many analysts have observed sickening unethical business practices in parastatals which they say are responsible for gross mismanagement. Morality bids everyone to do business in an ethical way.
Ethical business leadership makes every business executive, whether in a public or private corporate, examine him/herself on the conduct of sound business management.
No business unit can survive any form of competition and score huge profit margins when the whole gamut of its management practices are based on unethical business leadership.
Yes, the rot is high in Government institutions such as parastatals and local authorities. Many in the private sector with the same unethical business practices may have found sanctuary in a beehive at a time the bees are busy fighting those harvesting honey without protective clothing.
Whatever the case may be, the rot must be viewed as the highest form of economic sabotage; worse than treason. Its perpetrators should be severely punished. Unethical business leadership practice is a cancerous disease that has engulfed our great nation.
Everyone should be responsible and brave in fighting this scourge.
In Government there are three key business layers that need serious attention, that is the CEOs, the board and the appointing authority, in this case the minister.
Much has been said about the CEOs and indeed, rightly so, because they are the layer that must exercise both ethical and professional business leadership.
The CEOs are responsible for briefing the Board of Directors (BoD) on the state of any business entity they run.
Most corporate CEOs chair the strategic business committee that sets out the business trajectory of the corporate. This layer must not only be excited with the huge perks they get but must also be challenged on productivity levels.
It is therefore important that CEOs critically examine the business viability of their corporations and recommend to the BoDs how operations should be improved or enhanced.
The critical thing to be done here is for the CEOs to carry out an honest assessment of the business environment and judging by that assessment, correctly say where the business stands in that environment then make a detailed honest report.
It is important to note that on the basis of the CEO’s report the BoD, through its various committees, critically analyses it instead of just rubber-stamping it. The BoD must ask critical questions of the CEO.
The questions must be based on the report, focusing on how the CEO is planning to either improve the position of the corporate if it is loss-making and how he or she intends to enhance the corporate if it is profit-making.
What the people are reading in the media is the shocking practice where BoD are awarding CEOs huge perks and deliberately extending their tenure under an unending loss-making scenario.
Fellow Zimbabweans, how does the BoD extend the CEO’s tenure when quarterly reports were not presented to them and when even audited accounts were never availed?
These are simple corporate governance issues that are being deliberately ignored for what can be assumed as corporate cover-ups.
As the second layer in corporate governance, the BoDs must exercise ethical business leadership by doing what they are appointed to do: oversee the running of the business and not act as bureaucratic elements that are a cost to the business.
The third and most critical layer is the BoD appointing authority.
In government the appointing authority is the minister of the line ministry under which the parastatal falls.
In appointing the BoD the appointing authority must appoint people of integrity who should be prepared to protect national interests. The majority of the BoDs that have been involved in the current huge salary scandals do not have national interest and national progress at heart. These are boards that have allowed the practice of unethical business leadership to destroy the productive fabric of parastatals.
Such personalities tarnish the image of the appointing authority.
In a normal situation the chairperson of the BoD must regularly report to the appointing authority on the operational state of the business entity he oversees. The question is: What role did the appointing authority as a shareholder representative and the permanent secretary as the accounting officer responsible for the efficient management of these entities do to stop these unethical leadership practices?
Ironically, what we see is a chain of cosmetic measures being taken against non-productive CEOs and the boards awarding golden handshakes to non-performing corrupt CEO such as in the Cashbert (Cuthbert) Dube or Happison Muchechetere’s cases.
It must be noted that awarding non-performers golden handshakes is a recipe for disaster where those to be later appointed will deliberately walk the same route in order to be retired with a huge lump sum, making them rather filthy rich on top of running down strategic national institutions.
In the same vein, non-performing boards must be made to account for their failure.
It should be the appointing authority that demands explanations on why the boards do not practise their oversight role. In some cases giving unlimited benefits such as fuel to a CEO is officialising corruption. Once such unlimited benefits are given they become difficult to monitor and persecute as they become a contractual right.
It is therefore my humble submission that the appointing authority should from time to time send members of his/her ministry staff to check on his/her behalf the goings-on in parastatals that fall under the ministry. The objective here is to limit the CEO and the board working in cahoots as can easily be seen in the ZBC and PSMAS saga.
Accordingly, our laws must be crafted in a manner that curbs the current salary scandals. It is time Parliament and Government moved in to amend laws that seem to favour corruption where a corrupt individual benefits twice as we hear on the current salary scandals.
The law must make it extremely difficult for corrupt non-performing individuals to claim huge benefits. This must apply across the board in both private and public institutions.
Corruption has become endemic and its perpetrators get away with such malpractice using weak contractual laws that are easily being manipulated by looters of state coffers and shareholder funds. It is not true that parastatals are non-profit business institutions.
It is the personalities in the above layers of corporate Governance who are manipulating the loopholes in our laws as they loot public funds.
Some of the personalities in the layers are working in cahoots to sabotage the economy through greed and insatiable appetite for leisure that is driven by selfishness. I therefore urge our lawmakers to craft laws that make it a punishable offence for any layer of corporate Governance found practising unethical business leadership as in the current salary scandals.
That law must not be discriminatory and selective but apply effectively across the layers for the good of our nation.
Panganai Kahuni is a political socio-economic commentator.
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