No linked challenges.
No linked visions.
Improvement of the Corporate Governance Structure of Africa Nations
Corporate Governance is about the prevention of expropriation and theft............
According to Adrian C. (2000), “Corporate Governance is concerned with achieving a balance between economic and social goals and between individual and communal goals. The corporate governance framework is there to encourage the efficient use of resources and equally to require accountability for the stewardship of those resources. The aim is to align as nearly as possible the interests of individuals, corporations and society" (Sir Adrian Cadbury in 'Global Corporate Governance Forum', World Bank, 2000). In a simple language, Corporate Governance is about the prevention of financial impropriety through protection of shareholders and investors from direct exploitation from governments, minor shareholders, internal employees, and other external stakeholders of an organisation.
Africa as we all know is made up of as many as 54 countries with different governmental systems, policies, customs and practices. Some of the countries are inclined to common law practices, whilst others are to civil law practices, and other Anglo-American influences. In regards to the corporate governance system of the African continent, many are the researches that have been conducted. Among these researchers were Nganga S, Vimal J, and Artivor M. 2003, McKinsey & Co in 2002, World Economic Forum Researchers, just a mention of few.
Based on the findings of these researchers, the visual outlook proves to be very much more encouraging than many might have thought. Corporate governance practices in Africa are as good as other developed countries and even better than comparable emerging markets in Eastern Europe, Asia and Latin America. In the study conducted by (Nganga S, Vimal J, and Artivor M. 2003, 2), the researcher studied countries, including Kenya, Nigeria, Ghana, Egypt and Botswana and found out that the legal protection for shareholders is comparable to that in other developing countries.
Gone were the days when there were inefficiencies within the corporate systems of corporations within the African continent. Foreign investors and shareholders were in a state of panicky about their shares and equities and as a result some of them were shifting their interests and focus to other continents. Lo and behold, now the pendulum is being tilted to the other side. Many countries across the continent have adopted a code of Corporate Governance Best Practice based on international standards. Due to the relatively slow and inefficient legal systems in some of the countries, stock market authorities and regulators have emerged to protect shareholders and minorities. They have wide-ranging powers to resolve shareholder complaints and, unlike courts, they are perceived to be effective and efficient. For example, in Egypt, the Capital Markets Authority resolved 1,402 cases in the period 1997 to 2001 (Nganga S, Vimal J, and Artivor M. 2003, 11). Moreover, concurrent efforts are being underway by international and pan-African organisations including the Commonwealth Secretariat’s Pan African Corporate Governance Forum (PACG), the World Bank, the US-based Centre for International Private Enterprise, the African Capital Markets Authority, the United Nations Economic Commission for Africa, and other agencies to help restructure the corporate governance structure of African nations. These efforts are signs of better things to unfold in the future.
Nganga S, Vimal J, and Artivor M. 2003, Corporate Governance in Africa.
Sir Adrian Cadbury in \'Global Corporate Governance Forum\', World Bank, 2000
Opportunity: Attraction of more investors and shareholders, Growth in GDP
Threat: Competition between firms owned by foreingners and locals
Do you have ideas for this vision?
or
Would you like to comment?
Log in or Sign up
Comments