MIDLANDS STATE UNIVERSITY

FACULTY OF SOCIAL SCIENCES

PEACE, LEADERSHIP AND GOVERNANCE

NAME: HETZEL MBANJE REG NUMBER: R2116967M

.TAVONGA MASHIRI : R216065V

.SOLOMON MAGAYA : R2110030B

.RESPECT R MAPUNDU : R2115976H

MODE OF ENTRY: CONVENTIONAL

DEGREE: PEACE, LEADERSHIP, AND GOVERNANCE

MODULE: HPLG 201, PUBLIC SECTOR COOPERATE GOVERNANCE

LEVEL: 2.1

LECTURER: MR F CHIDHUME

QUESTION: EXAMINE THE NOTION THAT GOOD COOPERATE GOVERNANCE

IS A PANACEA FOR CORRUPTION IN ZIMBABWE’S PUBLIC SECTOR.
Good governance important priority for Zimbabwe's economic development and is the creation
of an appropriate corporate governance system for the public sector. The corruption that goes
unchecked, political interference, and poor governance practices in state-owned businesses are
now major threats to the expansion and long-term viability of the nation's public sector.
Corporate governance is a set of processes, customs, value codes, policies, laws, and structures
governing the way a corporation is directed, controlled, and held accountably. It ensures that the
organization is run correctly, that goals are being achieved, and that funds are managed with high
standards of propriety and probity (Corporate Governance Framework for State Enterprises and
Parastatals in Zimbabwe, 2010).

To begin with, good cooperative governance should be fair to employees and customers to be a
panacea for corruption in the public sector of Zimbabwe. For a good cooperate governance to run
perfectly, fairness to customers must be the number one priority (Mark 2019). For instance,
managers must push their employees to be at their best as far as the company is concerned and
also should be able to recognize the heavy workload of employees, to maintain good business
ethics. If there is no fairness to employees and customers, corruption will likely occur in the
sense that people will employees will go behind their employers to please the customers of a
certain company hence they will now benefit from the customers of a certain company by so
doing corruption is practiced within the corporate governance. For instance, in Zimbabwe many
companies treat their employees unfairly hence they start the act of going behind their employers
to satisfy their needs, accordingly, corruption is done. From this point of view, one can tell that
fairness to employees is an act of good corporate governance that can be a panacea for corruption
in Zimbabwe.

Moving on, good corporate governance should be disciplined enough to know what kind of
policies are harmful or beneficial to their employees (Mark 2019). Good corporate governance
should observe the conditions of their employees, in the sense of their financial background and
their working conditions before implementing certain policies. Some policies might force the
employees to rebel against their employers hence a form of corruption in practice. If employees
are not happy and they know they cannot be heard they find a way to benefit themselves from a
certain company and usually the benefit will be corrupt in such a way (Esser 2022). Hence good
corporate governance is very conscious about the policies they implement, From the point raised
above, one can tell that good corporate governance should be disciplined and aware of the
policies they implement to be a panacea for corruption in Zimbabwe.

Adding on, a good corporate government gives voting rights to its shareholders and stakeholders
for it to be a panacea for corruption in Zimbabwe. Voting rights strengthen shareholder
democracy in cooperate governance, and this can minimize the rate of disagreements in the
public sector hence the lesser the conflicts in corporate governance, the lesser the chances of
corruption (Volpin 2007). Shareholders in any corporate government should have the right to
choose the board of directors they wish, this shows transparency, and being transparent is one of
the major traits of good corporate governance. If the selection of the board of directors is not
transparent, this can give the board of directors power to do what they what and this will lead to
corruption. For instance, in Zimbabwe, some parastatals have a board of directors which were
not selected by other shareholders but in fact, they were appointed, therefore these board of
directors just loot money from the companies hence corruption is being done, for example,
companies like ZESA and ZINWA. From the point raised above, one can tell that a good
corporate government gives shareholders the right to choose the board of directors to be a
panacea for corruption in Zimbabwe.

The public sector in Zimbabwe demonstrated that corporate behavior toward shareholders,
employees, banks, customers, and society is influenced by good corporate governance. Mukusha
(2012) suggest that as a result, corporate governance improves organizational performance by
providing adequate information about developments in the company or organization. It is critical
to fully comprehend that the company's or organization's values should be established by the
Board of Directors in support of the vision and mission statement. In support of such values, it is
the board's responsibility to establish and ensure the communication of ethical business practice
principles and standards. However, this provides a balanced discussion of corporate governance's
principles and mechanisms. Based on the key corporate governance structures of board selection
procedures, board roles, responsibilities, and performance, malpractice focusing on risk, internal
controls, monitoring, disclosure, and transparency, Zimbabwe has developed a framework of
good corporate governance (ZIMCODE). Kaufmann, (2002 suggested that based on statistical
methods and tools, one must conclude that State Owned Enterprise performance is directly
correlated with good corporate governance. As a result, the organization will greatly benefit from
this when dealing with issues related to corporate governance, particularly malpractice and
corruption.

A good example can be taken through (ZIMRA) which draws a strategic plan that provides and
focuses on key terms such as short to medium term to achieve the desired outputs, outcomes, and
impacts hence a panacea for corruption. Good cooperative governance involves the protection of
civil society. According to the (Ministry of Finance and Economic Development) ZIMRA’s
operations also include curbing smuggling and any forms of international trade crime as well as
import, export, and exchange controls. It is crucial to note that most of these controls are meant
to protect the consumer against dangerous and harmful corruption in the economy. As an agent
Zimbabwean Government whose main responsibility is to collect revenue collection it uses the
administration codes or acts such as Customs and Excise Act (Chapter23:02). In addition
revenue collection goes hand in hand with the mandates which include facilitating trade and
travel, advising the government on fiscal and economic matters hence the solution to avoid
higher corruption.

The term corporate governance simply serves as a summary of how businesses operate.
According to Crowther and Seifi (2011), corporate governance has emerged as a current
buzzword all over the world. In recent years, corporate governance has gained a lot of
importance. Since the 2003 financial crisis, corporate governance has received a lot of attention
in Zimbabwe (Muranda, 2006).In Zimbabwe, problems with corporate governance have gained
the mass of several businesses. Air Zimbabwe, the Premier Service Medical Aid Society
(PSMAS), and the Zimbabwe Broadcasting Corporation (ZBC), are all noteworthy businesses. It
should be noted that poor corporate governance was primarily to blame for the corporate
scandals in Zimbabwe (Stifle et al.,2014).

However on the other hand one cannot leave other factors as Gono (2008) provides a remarkable
first-hand account of his tenure as the Governor of the Reserve Bank of Zimbabwe, from
December 2003 to November 2008, in Zimbabwe's casino economy, extraordinary measures for
extraordinary challenges, citing Zimbabwe Corporate Governance Books. The account of Gono’s
tenure is supported in this book by several beliefs, including, every nation strives for
development in terms of economic growth, equity, social cohesion, political stability, democracy,
and human rights, as well as sovereignty or national autonomy in international affairs. Because
of this, his account is the subject of public policy in a development context. According to
Chiromba(2012), the book also explains how political unrest and market failure compromised
order and stability, as well as how a casino ethic had devastating effects on the Zimbabwean
economy. The central bank's response to the challenges is described in detail in the book, which
concludes with a socioeconomic roadmap for reform and recovery and thus excluding the word
corruption.

Poor performance in State Owned Enterprises has primarily been attributed to weak corporate
governance systems in State Owned Enterprises and parastatals, as well as unchecked political
interference in their operations. The entire system lacks the fundamental checks and balances
necessary for good corporate governance, which makes it easy for corporate wrongdoing. One of
the most significant public sector scandals in Zimbabwe since independence was the ‘Salary
gate’ scandal, which rocked the country's public sector from 2013 to 2014. This scandal was just
a delayed manifestation of State Owned Enterprises' weak corporate governance systems.

The concept of corporate governance in the public sector of Zimbabwe is not new. According to
Chavunduka and Sikwila (2015), the ZIMCODE appears to be establishing corporate governance
standards that have never existed in the public sector. Even though SOEs have always had
corporate governance systems, corporate managers have deliberately chosen to ignore them. The
Corporate Governance Framework for State Enterprises and Parastatals, published by the
Ministry of State Enterprises and Parastatals in 2010, is comparable to the ZIMCODE in spirit
and letter. However, SOEs continued to engage in unethical corporate governance practices; with
significant parastatals like the Zimbabwe Broadcasting Corporation (ZBC), the Premier Service
Medical Aid Society (PSMAS), and the Zimbabwe Revenue Authority (ZIMRA), has becoming
archetypes of serious corporate malfeasance over the past years.

Conclusively one should note that cooperate governance is a crucial topic that requires additional
research is the peculiar corporate structure of state-owned businesses in Zimbabwe and how it
influences corporate governance in the parastatal sector. As a way forward it could be a panacea
for corruption in the public sector.
Reference List

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sustainability in the 21st century and beyond,” Journal of Sustainable Development in Africa,
Vol.14, No.2, pp. 15-24.

Besada and Werner (2010). “The Environment and Corporate Governance in Zimbabwe,” The
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Africa Corporate Governance Network. (2016). State of Corporate Governance in Africa: An

Overview of 13 Countries, ACGN, South Africa

Ayandele, I. A. & Isichei, E.E. (2013). Corporate Governance Practices and Challenges in
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Kaufmann, D. & Kraay, A. (2002). Growth without Governance, Economia 3: 169-229

Mafi, W. (2014). State-owned Enterprises Corporate Governance Framework needs to be

enforced, Chartered Secretary, Institute of Chartered Secretaries and Administrators in
Zimbabwe (ICSAZ) .

Organisation for Economic Co-operation and Development. (2015). Government at a Glance

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Office of the Auditor-General of Zimbabwe (2016). Report of the Auditor General for the year
ended December 31, 2015, on state enterprises and parastatals, Presented to the Parliament of
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Zimbabwe Government (2014). National Code on Corporate Governance Zimbabwe, Graphtech,

Newlands, Harare, Zimbabwe.