Impact of implementing the Public Entities Corporate Governance Act (PECG Act) Chapter 10.31 by State-Owned Enterprises (SOEs) in Zimbabwe

Abstract

The study sought to determine the impact of the Public Entities Corporate Governance Act Chapter 10:31(PECG Act ). The Act is the main piece of legislation governing corporate governance practices for State Owned Enterprises in Zimbabwe. In this view, the study adopted a mixed-methods approach in which pragmatism philosophy was applied. A convergent parallel design was used in which data was gathered using a structured questionnaire and an interview guide. The target population consisted of top and middle management, board members, board chairpersons, and CEOs of SOEs found in Zimbabwe. Using the sampling procedure developed by Krejcie and Morgan (1970), a sample size of 351 individuals was determined for quantitative data, and sixteen (16) interviews were done until saturation was reached. The research employed stratified random sampling for sampling respondents for quantitative data and purposive sampling was used for sampling respondents for qualitative data. SPSS version 23 was used to analyse quantitative data, whilst NVivo version 12 was used to analyse qualitative data. The main impact of the PECG Act was that it fosters accountability, transparency, and responsibility and encourages strategic planning for SOEs. The research also confirmed that reforms on restrictions on the remuneration of board members(RRORB) have a positive effect on corporate governance practices in SOEs, and reforms on dismissal and resignation (RDRBM) of board members lead to best corporate governance in SOEs. The study recommended that responsible authorities should make strict enforcement to comply with the dictates of the PECG Act. The study had a limitation that results from broad SOE categories may not be generalised to specific SOE categories.