Governance on the brink

PHILLIMON MHLANGA

In Zimbabwe, the corporate boardroom, a space meant for oversight, strategy, and accountability, has become a theatre of loyalty and mediocrity.

What should be a merit-based selection process, rewarding competence and integrity, has instead devolved into a ritual of patronage, entrenching weak governance and exposing both public and private institutions to systemic risk.

Memory Nguwi, a seasoned occupational psychologist and managing consultant at Industrial Psychology Consultants, lays bare the crisis.

“The whole process of appointing people onto boards has problems. In most cases, it’s not about competence or governance. The first question is always: Will you protect my interests? That is the wrong foundation for leadership,” Nguwi, who sits on several boards in Zimbabwe and abroad said.

Across Zimbabwe, boards are too often populated by individuals lacking the independence, skills, or professional integrity to challenge management decisions.

“You don’t appoint watchdogs,” Nguwi warns. “You appoint lapdogs who are desperate for jobs, allowances, and fuel coupons. They ask for fuel coupons few minutes after a board meeting. That kind of board member is a liability.”

In many companies, Nguwi highlighted, weak boards have frequently acted as rubber stamps for executive excess. Despite repeated government pledges to professionalise state-owned enterprises, the practice of rewarding loyalty over expertise persists.

Roseline Moyo, a governance researcher, confirms this observation, noting that recruitment criteria are often “designed to entrench patronage.” She adds: “We mistake loyalty for competence. Yet the real job of a director is not to clap hands for management, but to interrogate, challenge, and safeguard the future of the company.”

Nguwi paints a stark picture of dysfunction. He said directors “looking for sustenance rather than stewardship” erode accountability from the outset. Stipends are demanded immediately after meetings, meaning perks take precedence over principle.

“If you select people for boards who are looking for employment, you are already creating problems for yourself,” he says.

“They will not question management, because they are afraid of losing their perks.”

The problem is compounded by what Nguwi identifies as the Peter Principle: the elevation of individuals based on past performance, not future capability. Many reach their “highest level of incompetence” the moment they step into leadership.

Equally corrosive is the prevalence of charisma over competence.

“We confuse verbosity with vision. Someone speaks the most in meetings and suddenly they are chairman material. That’s how mediocrity spreads.”

Muzondiwa Siwela, a governance trainer, adds that the absence of structured vetting systems has created a crisis of credibility.

“Too many boards in this country are captured before they even sit for their first meeting. If appointments are based on political loyalty or personal connections, the boardroom becomes a danger zone instead of a safeguard.”

Beyond incompetence, Nguwi highlights the rise of toxic leadership.

Studies show that between 3.5% and 12% of chief executives globally exhibit psychopathic traits, that is manipulative, confident, and devoid of conscience.

These individuals thrive in environments where boards are weak, exploiting gaps in oversight to wreak damage.

International scandals, from Enron and WorldCom to Steinhoff and Carillion, demonstrate the cost of leadership unchecked by competent boards.

At the core of good governance, Nguwi asserts, is tension.

“A good boardroom has tension you can touch. Disagreement is not dysfunction, it is the only way to surface truth. But too often, directors value friendships and perks over accountability, and companies collapse under the weight of silent complicity.”

The economic consequences are stark. Poor governance erodes investor confidence, distorts capital allocation, and accelerates institutional failure.

In Zimbabwe,  most of the state-owned enterprises, which used to  account for an estimated 40% of economic activity, operate at a loss due to corruption, mismanagement, and weak oversight.

The International Monetary Fund (IMF) and Organisation for Economic Co-operation and Development (OECD) have repeatedly warned that without governance reform, attracting long-term investment remains a challenge.

Investors view board composition as a litmus test of corporate integrity.

Political interference exacerbates the problem. Ministers and senior officials often determine appointments in  State-Owned Enterprises (SOEs), prioritising loyalty to the ruling elite over competence.

Similar patterns have emerged across Africa, from Nigeria’s state-owned oil companies to Kenya’s National Youth Service and Kenya Airways, with political appointments leaving lasting economic scars.

Yet there are examples of reform.

South Africa’s King IV principles and the UK’s Corporate Governance Code provide regional benchmarks for board accountability, mandating independence, diversity, and transparency. Globally, investor activism is reshaping boardrooms, with asset managers such as BlackRock and Vanguard demanding higher governance standards or risking shareholder revolts.

In Zimbabwe, calls for independent appointments, competency frameworks, and term limits for directors have begun to surface, but progress is slow.

Nguwi’s warning is uncompromising: “Until we fix how we appoint board members, we will continue to recycle incompetence at the top. Governance will remain theatre, not substance.” He advocates merit-based appointments, robust training and evaluation, and a cultural shift from patronage to accountability, where disagreement is not feared but welcomed.

Ultimately, shareholders hold the power to drive change.

Boards should be the conscience of the company. If they are built out of friends and favourites, failure is inevitable.