Good corporate governance which is the underpinning principle that strengthens the effective administration of Institutions are often neglected due to the inability of directors to comply with basic laws and implements a transparent set of rules which ensure that shareholders, directors among others have aligned incentives.
To reverse this trend, UK-Ghana Chamber of Commerce (UKGCC), a power house that bridges the gap between UK and Ghanaian businesses by highlighting commerce and partnership opportunities and CalBank PLC have held a seminar to discuss various governance issues facing boards and how these could be addressed for the overall sustainability of businesses in the country.
Speaking at the event, the Chief Risk Officer of CalBank PLC, Barbara Benson explained that despite rigorous qualifications criteria for directorship positions by Institutions especially in the banking sector, some directors of Institutions lacked relevant skills and knowledge to effectively manage businesses hence the need for UKGCC to continuously engage established businesses to share their experiences with others, particularly start-ups that are still trying to acquire the needed skills and knowledge for expansion.
According to her, although there are regulatory bodies that assess the capabilities and qualifications of directors, a lot more could be done by management of Institutions to ensure strict compliance of the law for effective performance of the directors and Board members to ultimately impact decisions of these Institutions.
She said “The directors of banks go through rigorous assessment and not just the obligations of the regulators alone assessing them. It is not just about the qualifications they have alone, there are a number of criteria that are used to select directors, however if Institutions will take their time to check the background of potential directors, for instance, bad press about them, obtain police report about them, I am sure we will get the right fit for the position without even the regulators’’.
She added that although ACT 992 of the companies Act 2019 clearly outlines the qualifications of directors, most companies or Institutions fail to comply with the law hence the need to enforce them for sound management practices and decision making.
“some organizations select friends, cronies as directors, they sometimes do not even have a search criteria for appointment, they just select anybody, other board members do not even know whom to appoint as a director but I must say it also sometimes depends on the sector because what the law says is just the minimum requirement, and we do more than what the law says. We enforce the minimum requirement and add more as performance is key’’.
She also appealed to management of organizations to take appropriate steps to incorporate a board charter into the organization to meet its governance, leadership and compliance responsibilities. ‘’how do the performance of board members and directors impact on discussions that happens in the organization. You bring them to speed, you replace them or take them out if they are not performing’’.
On the issue of conflict of interest, Madam Barbara Benson noted that one of the best practices of corporate Governance is the declaration by directors and board members of any potential conflicts of interest situation that might arise in organizations.
According to her, any serious Board of an organization, serious of risk and compliance culture will ensure disclosures are made for good decisions to be made at the board level.
“Organisations should operate within the confines of the law, What is your personal interest in the discussions going on in the board room and in the organization, there is a charter, there are documents, if there are any conflict of interest, declare it’’. She added
The Executive Director of the United Kingdom Ghana Chamber of Commerce (UKGCC), Adjoba Akyiamah for her part said the purpose of the CalBank PLC and UKGCC conversation series was to strengthen top leadership credentials of organizations to enable them achieve their organizational goals.
According to her, the UKGCC which operate on three platforms of networking, advocacy and trade services since it started has encouraged larger, better structured and well-resourced members to share knowledge and experiences with smaller members and growing businesses that want to do business in the long term.
She emphasized “if you build stronger Institutions, you build a stronger nation, and if the private sector is strengthened, the economy is further stimulated and the country generally does better in the long run’’.
Madam Akyiamah thus urged Institutions to establish strong structures and comply with the laws by the regulatory bodies in order to sustain their businesses in line with good corporate governance practices.
She also stressed that UKGCC will continue to partner other organizations and businesses to share experiences and knowledge in the board room for effective management as far as good corporate governance is concerned.
Panelists at the event included Head of Sadir Gh. Ltd, Catherine Engmann, who took participants through board composition and independence while Mr. Felix Ntrakwa, the founder of Corporate law Institute, also shared some perspectives on efficiency of processes under corporate governance. A Business Professional and Executive coach, Reggie Mark Hansen also spoke on sustainability of businesses with a focus on the environmental, social and economic sustainability of businesses.
Staff from various departments of CalBank PLC participated in the seminar which was held at the bank’s head office in Accra.