Parastatals urged to appoint competent Board members
Botswana Accountancy Oversight Authority (BAOA) Chief Executive Officer, Duncan Majinda, says Board members who do not have the right skills and balance result in a poor Board that lacks experience to take parastatals to another level.
Majinda expressed this on Monday this week, when speaking at the Price Waterhouse Coopers (PWC) seminar, meant to foster the participation and collaboration between various stakeholders and promote Corporate Governance. He said parastatals should take the private sector route in order to be productive.
He worries that parastatals take an organisation with lots of ex-officio members, and do not consider whether people have the right skills to run the corporation. Majinda says the private sector have the nomination board that looks at the skills required and make decisions on the right people for the board, in contrast to parastatals, which do not have nomination boards because they are determined by the ministries.
“The other problem is advertising board positions which in most cases the relevant people do not apply, and from ministry the cabinet decides on the Board and this is where we miss it,” he says adding that compared with private sector there is a gap in parastatals. Majinda cited that Board fees are also a challenge with parastatals. “The Board fees for the private sector are huge.
They are paid about P10, 000 a meeting, but for parastatals the Board fees are so low. As a result good Board with skills would not want to go to parastatals unless they want to volunteer. They will go to the private sector which pays a lot,” says Majinda.
He says that parastatals also do not do well with Board evaluations, they are done because they are required to do them. They don’t use them for the purpose for which they are meant. “Evaluations for the board and to look at the individual member’s contributions and see how effective they are then decide whether their term should be renewed is crucial; but parastatals do not do that.