Feasibility of Implementation of Public Entity Corporate Governance Act's Best Practices to Enhance Good Performance in a State-Owned Enterprise

Abstract

This study examined the feasibility of implementing the Public Entity Corporate Governance Act's (PECGA) best practices to enhance good performance at a State Owned Entity (SOE). Boards of State enterprises and parastatals (SEPs) had encountered impediments in promoting corporate governance best practices in Africa. Identified factors hindering the implementation of PECGA of 2018 were examined to proffer recommendation for its adoption. Zimbabwe came up with the PECGA of 2018. The feasibility of implementing PECGA's best practices to enhance good performance at the SOE is not well known when this study was conducted. Mixture research methods were adopted where questionnaires were used to collect data. Purposive sampling methods were used to examine the populations of 38 head office managerial staff. Chi-square and regression analysis were used for analysis. It is found that job title and education level are related and the execution of sound PECGA best practices and the SOE's operational performance are related. The results confirmed that there were hindrances on the execution of sound PECGA best practices on the SOE's operational performance. The study concluded that it is not feasible to fully implement the PECGA best practices in SEPs to enhance performance in Zimbabwe. The Zimbabwean's PECGA must be moved from the "apply or explain" model (that is relying on the disclosures requirement doctrine as a method of promoting the execution of definite corporate governance practices devoid of mandating real practices) to "comply or else" model of corporate governance to achieve sustainable corporate governance success in the near future.