The Ideal Corporate Governance Model for State Owned Enterprises in Zambia

Abstract

Purpose: Corporate governance concerns many problems of contemporary corporations and is a dynamically developing discipline of organisation and management science of significant practical importance. The purpose of this study was to explore the current state of corporate governance in these state owned enterprises with a view to develop an ideal corporate governance model for State Owned Enterprises in Zambia. Design/Methodology/Approach: This paper was part of a larger, mixed-method study which employed qualitative measures (cognitive interviews with key informants and reviewing literature on corporate governance models and theories used in other countries). We employed Martin Heidegger’s existential phenomenology as the underpinning philosophy and methods for this study. Findings: The findings indicate that state owned enterprises do not have good corporate governance structures and this is compounded by a complicated legal framework in the country. Major shareholders have more powers in determining board composition and even how the enterprise ought to operate. There are impositions on state owned enterprises where owners hardly finance state owned enterprises and impose public service obligations. In many ways, owners impose restrictions. Research Limitations/Implications: Understanding of the ways in which shareholders are determining the current corporate governance practices could help to advance standard practices and a context specific framework. Methods to ensure the application of cooperate governance should also be explored further. Originality/Value: This is one of the first studies to provide a corporate governance framework for state owned enterprises in Zambia.