Shareholder Compact Agreement

The Ministry of Agriculture and Housing and Botswana`s only parastatal housing company (BHC) reached an agreement on Monday known as the Shareholder Pact, which is considered one of the best practices tools of corporate governance and has since been mandatory for all parastatals. Mr. Maele also stated that the agreement would re-empower the commitments made by the department and the Board of Directors with respect to the successful execution of the mandate and would also align the parastatal`s performance expectations with the department`s effective oversight strategy. In addition, he stated that the supervisory function went beyond the usual performance monitoring, as it also revealed that the strategic intent of the department and its parastatals were aligned as indicated in the shareholders` pact they signed with CITF. « These issues were not necessarily observed by BHC alone, but observed by all Parastata, they forced the government to formulate a shareholder pact as a performance agreement between the shareholder and parastatal, » he said. The permanent secretary of the Ministry of Labour and the Interior, Pearl Matome, said the government had demanded that shareholders be signed since 2012, when the ministry took four years to do so. The Trust Fund of the Ministry of Labour, Interior and Construction (CITF) has signed a shareholders` pact. He said the agreement would help assess the effectiveness, efficiency and accountability of the CITF with respect to skills needs in Botswana. The purpose of the meeting was for the Ministry of Public Enterprise to inform the committee of shareholder compacts signed with state-owned enterprises. The committee`s information, which consists of the legislative context of the shareholders` pact; The government`s policy objectives for state-owned enterprises (SOCs); An updated framework for planning, monitoring and logical evaluation Key components of compacts Achieving the equivalent of agreed objectives and an update to SOC Compacts` portfolio. In discussions following the briefing, members asked what the consequences of the lack of effect on shareholder payment contracts would be and whether the Ministry of State-owned Enterprises deserved the expertise and capacity to control delivery. They also asked whether the ministry did not have the early warning systems to predict and prevent poor performance and non-delivery.

The committee asked whether it was possible to help the ministry introduce punitive sanctions into the legislation to ensure compliance by state-owned enterprises. The question of whether the department is able to control compensation for poor performance and remuneration in state-owned enterprises was also examined. The ministry was formed to encourage state-owned enterprises to incubar and promote craft programs and training. The Committee commended them for their leadership role in managing South African Airways` problems. The department was told that the same direction should be reflected in other state-owned enterprises. The Commission postponed the adoption of the PV from 19 February 2013 to a later date. Members stated that the minutes, as prepared by the Secretary of the Committee, did not cover all the issues raised and discussed during the meeting. The Chair instructed the Secretary of the Committee to rewrite the minutes so that it could be adopted at the next meeting of the committee.

She said the agreement was a testament to a relationship and obligation that the two units were prepared to offer Batswana.

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