Poor governance can cost a lot of money, according to Prez Akufo-Addo.
President Akufo-Addo has stated that everyone should be concerned about governance infractions because they impose enormous costs on the entire society when they occur.
“The cost of poor governance can be enormous,” he said in remarks delivered on his behalf to the Institute of Directors, Ghana (IoD-Gh) at its stakeholders’ forum by Minister of State at the Finance Ministry, Charles Adu Boahen.
According to President Akufo-Addo, the government realized it had inherited “a deficient financial infrastructure” not long after taking office in 2017 and ended up spending over GH21 billion “to remedy the consequences of bad corporate governance in the financial sector” and another GH4.5 billion “to protect investors in failed asset management companies.”
“Poor corporate governance across public enterprises has also had a significant adverse impact on our fiscals, with state-owned enterprises reporting significant and persistent operating losses,” the President said, adding that by the end of 2019, state-owned enterprises had a total of GH16.37 billion in outstanding on-lend loans.
Similarly, during the Covid-19 pandemic in 2020, the government was forced to transfer over GH166 million in government support to a number of these state-owned entities.
“These resources could have been used, among other things, to expand social welfare programs to mitigate the impact of the pandemic on the average Ghanaian,” he said.
President Akufo-Addo hoped that the forum would foster strong collaborations among various public and private stakeholders to promote good corporate governance and ethical leadership to build a more resilient economy while promoting Ghana’s Beyond Aid agenda.
He cited several measures taken to address the issues, including extensive engagement with SOE management and the establishment of the State Interests and Governance Authority (SIGA), which is leading efforts to ensure SOEs can run efficiently and profitable operations while also meeting basic statutory requirements.
“We can all relate to the impact of good and bad corporate governance, and it is this shared experience that has brought us all here today,” he said, adding that “good governance necessitates credible and trustworthy institutions founded on transparency and accountability.”
Between the 16th and 19th of November, the IoD-Gh held its 4th Annual Directors’ Week Celebration, which included a variety of activities.
The Annual Directors’ Week Celebration brings together directors from the public and private sectors, as well as members of the Institute, to build capacity, network, and share ideas on how to promote professional directorship and good corporate governance.