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Bank of Ghana rolls out Corporate Governance guideline next year

Nov. 10, 2016, 9:19 a.m.

The Bank of Ghana (BoG) will from next year introduce a Corporate Governance guideline that will ensure financial soundness in the banking sector and improve economic efficiency and growth, the Second Deputy Governor of BoG has said.

He explained that in contemporary banking, sound corporate governance is particularly important as the rapid changes brought about by globalization, deregulation and technological advances are increasing the risks in banking.

According to the deputy governor, the BoG issued a Corporate Governance Exposure Draft in 2014 to elicit comments and constructive contributions from the industry.

The draft document has incorporated suggestions from industry, including a review by the IFC, and ‘remains work-in-progress that would be issued appropriately when completed’.

A Former Rector of the Ghana Institute of Management and Public Administration (GIMPA), Professor Stephen Adei, has been the sole champion of public and private institutions especially finances houses to establish good and proper governance structures.

Professor Adei has over the years blamed the government for the weaknesses in the governance structure of public institutions.

According to him government most often appointed the wrong people who lacked the required training to act as board executives in state institutions -- a situation he said did not bring fair balance on the board.

"These board executives are appointed based on their political affiliations and not on merit," he said.

He also said on the whole, the state of corporate governance in the country was bad as there were more questions than answers about the public sector and it was almost non-existent in the small-and-medium enterprise (SME) sector.

This come at a time when some board members of state institutions have been cited for being a burden on the finances of the institutions they superintend since they are paid sitting allowances which are almost half the total budget of those entities.

Some are even alleged to have been given official vehicles and office accommodation, among other facilities, which they are not entitled to.