President Nana Addo Dankwa Akufo-Addo has served notice to board members and corporate executives of State Owned Enterprises (SOEs) who defy the statutes governing their institutions to get ready to face the law squarely.
He said the Board and management of SOEs and other state entities, who flouted corporate governance rules and regulations with impunity, would no longer go unpunished.
“The days where board members and corporate executives flout rules and regulation and are left off the hook are over,” the President said, when he launched in Accra, on Monday, the State Interest and Governance Authority (SIGA).
The SIGA that now assumes the role of the State Enterprises Commission (SEC) and the Divestiture Implementation Committee (DIC), would ensure the efficiency and financial viability of SOEs and help them deliver on their mandate. All the assets and liabilities of the defunct SEC and the DIC had been transferred to the SIGA.
President Akufo-Addo indicated that the law establishing SIGA, (Act 990), had empowered the body to prosecute board members and corporate executives who break or sidestep corporate governance regulations.
Those who violate the law could face a jail term of not less than 5 years, and up to 10 years, he stated, adding, “This is a strong indication of the extent to which the barometer of corporate governance and executive decision making has been lifted.”
The President said though the SIGA was not the panacea to all the challenges faced by SOE’s, the institution would manage state assets in a more financially sustainable manner and provide better returns on investments on SOE’s, Joint Venture Companies and other State enterprises.
The Authority, established due to the negative returns on state owned companies and corporate governance challenges, would be responsible for assisting the Finance Ministry assess the borrowing levels of the state owned enterprises and other state enterprises in accordance with the relevant financial laws.
The SIGA would also ensure that the various state owned enterprises, joint venture companies and other state enterprises pay the dividends due the state.
Pointing out that state owned companies were established in the past to creating employment opportunities and produce goods and services to citizens, the President said most of the SOEs and joint venture companies had sustained losses and become highly indebted and on the verge of collapse.
As a result of systemic internal failures, majority of the companies had been unable to pay dividends to the state, while others were relying on government bailouts.
Currently, government holds equity interest in 103 enterprises, including joint venture companies in key sectors of the economy.
Mr. Terry Darko, former President of the Ghana Employers’ Association chairs the SIGA, while Mr. Stephen Asamoah Boateng, had been appointed the Director General of the Authority.