CASL-NHRDC panel discussion highlights importance of good governance

By Shannon Jayawardena

Highlighting the importance of good governance, the launch of the Handbook on Good Governance for Chairmen and Board of Directors of Public Enterprises invited an expert set of panellists to share insights and their viewpoints.

The event invited NHRDC Chairman Dinesh Weerakkody as the moderator and CASL Public Sector Wing V.Kanagasabapathy, Auditor General’s Department Auditor General Gamini Wijesinghe, Sri Lanka Institute of Directors President Preethi Jayawardena, Central Bank of Sri Lanka Bank Supervision Additional Director Roshan Perera and CASL Vice President Manil Jayasinghe as panellists. 

Kanagasabapathy said: “The lack of professional management is the problem; not only in the board but in the senior level management as well. There must be a continuous monitoring of the operations. These problems can be solved by introducing good governance.”

“In some countries they have a selection board, they advertise and make recommendations. So if we can select at least three members and recommend them, one of them can appointed. What they are doing now is being done for the sake of doing it and is of total irrelevance. The strategy plan has to be formulated right away. There must be a constant monitoring of performance,” he added.

The handbook on good governance was developed by updating the existing guide by a committee consisting of representatives from CASL, SLID, Public Enterprises, Department of the Treasury, Ministry of Public Enterprises Development, Ministry of National Policy and Economic Affairs, SEC and CBSL.

Thereby it includes salient features and key provisions of relevant statutes and is expected to serve as a reference guide for the chairman and board of directors of public enterprises across the country.

Wijesinghe noted: “There are so many rules and regulations but they haven’t been implemented properly. It has to be enacted to some extent. Little by little we are coming to that platform. Mismanagement is the biggest challenge and things need to be brought into the table. It is only then can we implement effectively.”

He further said: “We are losing nearly Rs.25 billion a year because of mismanagement. Things are just moving around without any rules and regulations. It is important to take into mind the losses and what will happen to the country. 

A good accountability structure is key in order for these issues to be addressed and developed. If that structure is to be placed, then all these problems will be solved he further stressed upon.

Jayawardena stated: “Any organisation must be run ethically and efficiently with proper regulation practices. If not, at the end of the day the organisation will suffer but is it due to their incapability or government compulsion is something we have to ponder upon.”

“I represent a bank and if you compare a private bank with a state owned bank, it is a similar example. You have to have quality policy. If you take a private bank, there is proper nomination committee and people are recommended accordingly. No shareholder can go beyond 10%. You have to look at the priorities,” noted Jayawardena

The Sri Lanka Institute of Directors has a board leadership training program which is tied up with the IFC and covers everything a director should know in running a company efficiently he noted. 

Perera said: “As a board we are committed to understanding where we are at the moment. You cannot put all public enterprises into one sector as some are handled well and some aren’t. It’s all a spectrum. The lack of accountability is a huge problem and this needs to addressed.”

She emphasised on the challenges that the public enterprises face and shared her viewpoints on managing these issues while speaking on the current measures that are being taken. She added that creating awareness on the rights and regulations is very important.

Jayasinghe stressed: “One of the key differences between the private and public sectors is that sometimes the public sector has objectives which are not necessarily only profit. You need to bring in a performance management culture and you need to think how to best provide the operations.