SOE assets worth N$62bn

Currently SOEs have assets of more than N$62 billion and an annual income of more than N$23 billion.

26 November 2019 | Business

Mines minister Tom Alweendo says there is a governance problem at several state-owned enterprises (SOEs), which currently house assets of more than N$62 billion and rake in annual income of more than N$23 billion.

He said in order to address this adequately, competent persons will have to be appointed to serve on boards.

Alweendo was speaking after the official inauguration of the new National Petroleum Corporation of Namibia (Namcor) service station at the Hosea Kutako International Airport last week.

“You will agree with me that one of the challenges facing a number of our state-owned enterprises (SOEs) is that of poor governance,” the minister said. He said boards of directors are fully responsible for the oversight role in any company.

In other words, it is the board that is responsible for the performance of a company. In fulfilling its responsibility, the board needs to put in place measures to monitor and control management, in order to strengthen governance, Alweendo said.

“There appears to be a crisis of confidence when it comes to governance in some of our SOEs. More often than not one reads about some malfeasance in some of our SOEs. The more this happen, the more we run the risk of the public losing confidence in the integrity of our SOEs.

“It is therefore incumbent upon our boards and management of SOEs to do everything in their power to demonstrate a strong commitment to the enforcement of clear and firm standards of corporate governance,” Alweendo added.

Government will, according to Alweendo, ensure that the best people available serve on the boards of SOEs.

“Going forward, the shareholder ensures that only people who are knowledgeable about the nature of the business of a particular company, and those with integrity, are considered for appointment as directors on the boards of SOEs,” he said.

This was critical, given the assets these entities have under their management.

“Given the important and significant roles played by the SOEs in the economy, it is not an exaggeration to say that good corporate governance in our SOEs is a critical factor in our socio-economic development.

“Currently SOEs have assets of more than N$62 billion and an annual income of more than N$23 billion. These are big numbers, by all accounts,” said Alweendo.

“It is therefore incumbent on all of us to ensure that we continue to improve the effectiveness with which we manage state companies.

“In the end, it is ethical behaviour and sound business practices that will matter most, in the promotion of good corporate governance,” Alweendo said.

OGONE TLHAGE

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