An assessment of corporate governance in urban local authorities : a case of city of Mutare

Abstract

Corporate governance is blend of law, regulation and appropriate voluntary private sector practices which enables the organization to attract financial and human capital to perform efficiently. Generally corporate governance involves a set of relationship amongst the company’s management, its board of directors, its shareholders, its auditors and other stake holders. Corporate governance is the process carried out by a board of directors and its related committee on behalf of and for the benefit of the organizations shareholders and the other stake holders, to provide direction, authority and oversights to management, this is according Youssef (2007). In the narrow sense, corporate governance in local authorities is the system which provides a framework to direct and control their functions. It is primarily concerned with decision making within and at the highest levels of an organization. Good corporate governance and the guidance that comes with it provides an organization with clear accountabilities.It is clear that there is a research gap in this area of study and that further research needs to be carried out, in order to assess corporate governance in Zimbabwean urban local authorities but mainly focusing on Mutare City Council. A simple random sampling of the targeted population was employed. The researcher used questionnaires to collect the data and also made use of secondary sources and literature for comparison and improvement of analysis. The collected data was altered to identify differences and establish uniformity and then assembled to facilitate entry of the responses into the computer. Also the quantitative data was analysed using a statistical package for social sciences (SPSS) and excel spreadsheets. The quantitative findings was presented in form of tables and percentages to enable easy translation by the readers accompanied by the essential explanations and narrations. From the study it was established that corporate governance principles such as responsiveness, accountability, fairness and transparency (RAFT) contribute positively to Mutare City Council. Mutare City Council must review the current operational corporate governance principles in the organisation from time to time, and make sure that they are well known to all shareholders and stakeholders.