Mohamed Adam

Restructuring State-Owned Enterprises

In essence, the involvement of government in the provision of services and products in certain sectors of the economy stems from two main factors.1

Transparency and Reporting

Transparency is inextricably linked to accountability and is thus one of the essential ingredients of good corporate governance.1 Transparency concerns the obligation of an organisation to account in an open and honest manner to those with a legitimate interest — the stakeholders of the business (AccountAbility 1999:8).

Appointing the Board of Directors

The effectiveness of any company is determined by the quality of its leadership. A board of directors is the controlling mind of a company and is critical to its success. The role of the board is discussed in Chapter 3. The focus of this chapter is on the structure of the board of a state-owned enterprise and how to ensure that it is in a position to lead the organisation effectively.

Why Corporate Governance Matters

The catalysts of economic growth, particularly in developing countries, include foreign direct investment (FDI) and a healthy and efficient business sector. A country’s investor appeal is influenced by a number of factors, including its fiscal and tax policies, the institutional framework for trade and investment, and good governance.

Financial Management and Governance

The Public Finance Management Act No. 1 of 1999 (as amended by Act No. 29 of 1999) is one of the key pillars, if not the very foundation, of public sector governance in South Africa. It is therefore important to discuss its implications for state-owned enterprises. This discussion will not only be relevant in South Africa, but could guide readers in other countries where similar legislation is being considered.

Shareholder Performance Agreements

It should have been an ordinary board meeting. Agenda papers had been circulated and the board was in the midst of a discussion, faced with what appeared to be a relatively simple decision. All the directors had grappled with large investment decisions before. But this one was different.

Leadership and Governance in State-Owned Enterprises

In any organisation, good corporate governance is ultimately about effective leadership. An organisation depends on its board to provide it with direction, and the directors need to understand what their leadership role entails. Furthermore, a great deal depends on the appropriate demarcation of the respective roles of the shareholder, the board and management.

The Legislative and Policy Framework in South Africa

Good corporate governance is shaped by the principles on which a company’s corporate governance practices are based, and the legislative and policy framework in which companies operate.

Hallmarks of Corporate Governance

Around the world corporate governance has come under the spotlight over the last decade. This is evident from the development of a host of codes of conduct and guiding principles in different countries and organisations.

The Structure and Governance of Eskom – A Case Study

Corporate governance has become a global phenomenon. This book highlights, through various case studies, how corporate governance has evolved in a number of countries around the world. The international cast of contributors, from varying professional backgrounds including academics, lawyers and company directors, focus on different regions around the globe, reflecting various ownership structures, legal systems, and political and cultural aspirations. Some of the case studies used include: Standard Life; Telecom Italia; and Eskom.