Mr Alan John Kwadwo Kyerematen, Minister of Trade and Industry, says Good Corporate Governance practices are necessary for the promotion of Ghana’s socio-economic transformation.
He said it was in the interest of government and the country to promote best practices in corporate governance nationally to help build strong institutions, industries, and an even stronger, inclusive, and more sustainable economy.
Mr Kyerematen said this in a speech read on his behalf by the Deputy Minister of Trade and Industry, Nana Ama Dokua Asiamah Adjei, at a sensitisation forum on the “African Principles and Guidelines on Corporate Governance – Building a Framework for Competitiveness and Growth for the Private Sector in Ghana,” organised by the African Peer Review Mechanism (APRM).
He said the financial reforms in Ghana undertaken by the Bank of Ghana, the Global Financial crises in 2007 and the 2008 was due from corporate failures and poor corporate governance.
Therefore, he said good Corporate Governance was important in building not only strong institutions, but communities, and economies and consequently helped to avoid the collapse of businesses.
He stated that as the country emerged from the current COVID-19 pandemic, it required new emphasis on strengthening governance and sound management of corporate Ghana and public sector institutions to deliver the desired outcomes for all stakeholder groups.
Corporate governance standards continue to evolve globally with increasing emphasis on effective risk governance, promoting sustainable and social development goals, board effectiveness, strong internal controls, and incentive structures that support prudent management.
Mr Kyerematen said the new Companies Act of 2019 (Act 992) had elevated governance standards for companies while, similarly, the provisions of the Public Financial Management Act of 2016 (Act 921), the State Interests and Governance Authority Act of 2019 (Act 990) were serving as guides.
All of those, he indicated, had raised the bar for the governance of public sector institutions, including State-Owned Enterprises to help promote transparency, accountability, and prudence in the management of State resources for the benefit of Ghanaians.
Mr Rockson Kwesi Dogbegah, President, Institute of Directors-Ghana (IoD-Gh) said the key components of a functional democracy – efficient institutions, responsible government policies, and a strong rule of law – were the same factors that contributed to a competitive economy.
He said the drivers of good corporate governance were laws, rules and institutions that provided a competitive playing field and disciplined the behavior of stakeholders.
Mr Dogbegah also the Chair of the African Corporate Governance Network (ACGN), noted that experience in developed market economies showed that good governance was anchored on the availability and application of the appropriate legal framework, national codes and its strict enforcement coupled with the appropriate behavioral and cultural considerations that promoted sustainable socio-economic development.
“There is now increasing momentum locally and internationally towards implementing more laws and government regulations that impose obligations on companies, their directors and officers, to adopt, implement and comply with good corporate governance principles,” he stated.
Failure to do so, the IoD-Gh President said, may lead to legal and criminal sanctions being imposed on the company, its directors, and officers.
He said the ACGN considered the framework appropriate but highly recommended that, countries should bring their cultural orientation to bear on its use and stakeholders should ensure the development of an increased appetite for the implementation of the codes when developed.
Professor Edward Maloka, Chief Executive Officer, APRM, said “good Corporate Governance is good for Africa,” adding that the practice of good corporate governance was universal.
He said since its establishment in 2003, the APRM had conducted 25 reviews among 42 of its member states with Ghana being the first, adding that the adoption of the Principles and Guidelines of Good Corporate Governance would accelerate economic development in Africa.