NATIONAL UNIVERSITY OF SCIENCE AND TECHNOLOGY

GRADUATE SCHOOL OF BUSINESS

GENERAL MASTER OF BUSINESS ADMINISTRATION

An analysis of the effects of Board structure, functions and processes on company

performance: A case of Zimbabwe’s parastatals and state enterprises.

Research Proposal

Silas Freddy Matope

N01523890Q

0773 364 248

matopesilas@gmail.com
 CHAPTER 1

Introduction

Corporate governance has become an increasingly interesting subject due to the

pervasiveness of global and local corporate scandals and high level collapse of corporations.
The collapse of large corporations has had overwhelming consequences on society including
loss of jobs and investments. Corporate governance is critical to State Owned Enterprises
(SOEs) as it is for private corporations. Ineffective corporate governance may lead to poor
financial performance lack of accountability and transparency with the potential of causing
business failures. In trying to establish the main causes of business failures and poor
performance of SOEs researchers have concluded that management and board of directors are
responsible for ineffective corporate governance structures and poor performance of State
Owned Enterprises OECD (2005). It is therefore apparent that board structure, functions and
processes be examined to establish its link to the overall performance of corporations.

Background of the Study

The degree to which country’s public entities observe basic principles of good corporate
governance is an increasingly important factor for attracting investment capital, maintaining
economic stability and encouraging growth Moyo (2016 p,v). Corporate governance has
become increasingly important in Zimbabwe especially at this time when the country is on a
drive to attract investment. This has brought the need for state Owned Enterprises to be
managed effectively by competent people who are able to formulate and implement
effective strategies important for business success and economic growth.

Corporate governance can be defined as a system by which companies are directed and
controlled, Cadbury Report (1992). It includes an environment of trust, ethics, moral values
and confidence as a synergic effort of all constituent parts that is stakeholders including
government, the general public, service providers, professionals and the corporate sector,
Seifi and Crowther (2011, p11). The Corporate Secretaries International association further
defines it as a set of processes, customs, values, codes, policies law and structures governing
the way a corporation is governed controlled and held accountable. Good corporate
governance maximises profitability and long term value of the firm for shareholders. It is
therefore about putting in place the structure, processes and mechanisms that ensure that the
firm is being managed and directed in a way that enhances long-term shareholder value
through accountability of managers and enhancing organisational performance, Velampy T
(2013, p 229). Simply put corporate governance is a system by which an organisation makes
and implements decisions in pursuit of its goals. Corporate governance is all about providing
a secure institutional platform and guidelines that preserve the interests of stakeholders while
enhancing corporate performance Bathula (2008).

Corporate governance can be viewed as the design of institutions and mechanisms that
include control, board of directors and management to best serve the interests of shareholders
in a company and resolve conflicts among them, subjects to the constraints, economic, legal
and ethical norms Ho (2002). Sound corporate governance is good for maximising the
shareholder value and productivity of companies Lin (2004).

In the wake of large scale financial collapse of viable corporations such as Enron, Worldcom
and Parmalat, the world awoken to the need to implement sound corporate governance
practices Ndlovi et al (2013, p1). Committees and commissions have been established in
response to such scandals, these include the Treadway Committee (1987), Sarbanes Oaxley
Committee (2002), Cadbury Committee (1992), King Committee (2002) and the Green bury
and Higgs Committee (2003). These have led to the development of various corporate
governance frameworks in different countries.

The pervasiveness of financial scandals in Zimbabwe has revealed a lot of concerns on

corporate governance in both the private and public sectors. Corporate governance has
attracted a great deal of attention since the mid-1980s when concerns about the way
companies were controlled and held accountable were overshadowed by their commercial
success Crowth and Seifi (2011). Corporate governance has become one of the most talked
about issues in Zimbabwe. Issues of corporate governance have become particularly
important in developing countries like Zimbabwe because of the rise in abuse of corporate
privileges and responsibilities by corporate directors and their allies.

Corporate governance in Zimbabwe has attracted a lot of attention since the time of the
Willowgate scandal in the mid 1980’s and this rose in the 2003 financial crisis Muranda
(2006). Several companies have faced problems associated with corporate governance.
Recently SOEs such as Zimbabwe Broadcasting Holdings (ZBC), Air Zimbabwe, Premier
Service Medical Aid Society (PSMAS) and Netone have faced a number of challenges
ranging from mis-use of funds, fraudulent procurement procedures, corruption, and abuse of
office. The major cause of these corporate scandals in Zimbabwe is centred mainly on poor
corporate governance Sifile et al (2004).

The existing corporate governance framework in Zimbabwe’s State Owned Enterprises

(SOEs) has not been effective in improving their performance and effectiveness of the
boards due to lack of commitment, consistency, political interference weak enforcement
mechanism and the general and wilful disregard of the rule of law Moyo (2016 p.v). SOEs
and parastatals play a critical role in promoting socio- economic development by providing a
wide range of products and services and social infrastructure such as food, water, electricity
and health. Muzapu. R et al, (2016, p.1). The operation of these SOEs thus has an impact on
ordinary citizen’s everyday lives while playing a huge role in the overall competitiveness of
the economy.

According to Muzapu. et al, (2016, p.1) State owned enterprises and parastatals provided for
over 40% of Zimbabwe’s GDP at independence in1980. This has however been declining
due to a myriad of factors with the weaknesses of governance structures among them,
Ministry of Finance Midterm Fiscal Policy (2015). In 2004 the Auditor General exposed a
host of corporate management challenges in SOEs with corrupt tendencies and financial
scandals being the major issues Auditor General Report, (2014). An analysis of individual
institutions revealed structural and organisational problems of incomplete accounting and
financial statements, illegal governance practices, poor management and investment
decisions manifesting through the flouting of tender procedures, diverting company property
for personal use and awarding unjustifiably hefty salaries by some chief executives
Auditor General Report (2015). These corporate scandals have brought corporate governance
to the limelight and with such challenges; the effectiveness of the Board of Directors
becomes questionable. The main responsibility of governing the company is upon the board
and therefore attention must be paid to their functions, structure and processes. The board
should be the heart and soul of the company. Whether or not the company grows or not
depends on the sense of purpose and direction, their values and the will to generate
stakeholder satisfaction and the drive to achieve them, Jan. S and Sangui M (2016 p707).

Jensen and Meckling (1976) put across the agency theory which suggests that in many
modern organisations, there is a separation between ownership and management. This
separation may result in what they call the agency problem. The board’s role is thus to
reduce this agency problem through the separation of management from the control aspects
of the decision making process, Jensen and Fama (1983). Boards of directors thus play an
important role in maintaining effective corporate governance particularly in public enterprises
where agency problems may arise from the separation of ownership and control.

Zimbabwe’s corporate governance like other emerging markets is based more on the board of
directors than the market. In Zimbabwe, state enterprises and parastatals board of directors
are central to the corporate governance system with ultimate accountability and responsibility
for the organisation’s performance Frederick (2011). The board of directors is largely
considered as the cornerstone of the company’s corporate governance structure with the
primary role of the company’s activities to the interests of the stakeholders. The board of
directors is seen as the most important corporate governance mechanism that monitors and
advises the company’s top management in performing their responsibility to protect
shareholder interests Sohl et al (2015).

The role of the board is therefore not to simply fulfil legal requirements, it is there to provide
strategic guidance and leadership, objective judgement independent of management to the
company and exercise control over the company while at all times remaining accountable to
the shareholders Charttejee (2011, p. 2). An effective corporate governance system is the one
which allows the board to perform these functions effectively.

The effectiveness or lack thereof of Board of Directors has become a global concern,
Velampy. T, (2013, p. 229). Corporate collapse, fraud cases, questionable strategic decisions
are attracting a lot of attention at the top decision making body of the corporation (the board
of directors). As a result, various codes such as the Cadbury Report (1992), Greenbury
Report (1995), Sarbanes Oaxley Act (2002), King Report (2002), and the ZimCode (2015)
have been developed in an attempt to set standards of corporate governance.

Until April 2015 when a code of corporate governance was crafted and adopted by the
Zimbabwean cabinet, Zimbabwe has been operating without a code of corporate governance
and this has seen a lot of irregularities in the composition, characteristics, functions and
processes of most parastatals and state enterprises. At present corporate governance in
Zimbabwe is regulated by the Companies Act (chapter 24:03) and the Zimbabwe stock
exchange Act (chapter 24:18), ZSE listing requirements, Public Finance Management Act
(chapter 22:19) as well as rules for various professional bodies such as the Institute of
Directors of Zimbabwe IoDZ Maune (2015). Prior to the launch of the ZimCode, in April
2015, the private sector followed the provisions of the King 11 code of South Africa and the
Cadbury Report of England. However these were not mandatory that were not uniformly
applied.

The board of directors is seen as the most important corporate governance mechanism that
monitors and advises the company’s top management in performing their responsibility to
protect shareholder interests Sohl et al (2015). In Zimbabwe, state enterprises and parastatals
board of directors are central to the corporate governance system with ultimate accountability
and responsibility for the organisation’s performance Frederick (2011). They are largely
considered as the cornerstone of the company’s corporate governance structure with the
primary role of the company’s activities to the interests of the stakeholders. Boards play a
vital role in the corporate governance of companies hence it is important to understand the
relationship between the board structure functions and processes and the overall performance
of the firm. In light of the growing need of sound and effective corporate governance models,
procedures and processes, this research will therefore investigate the impact of board
structure, functions and processes on the performance of state enterprises and parastatals in
Zimbabwe while providing and overview of the current state of corporate governance in
Zimbabwe.
Justification of the study

Until recently Zimbabwe has been operating without a code of corporate governance. In
2015 the Zimbabwean government adopted the code of corporate governance mainly as a
result of the developments in state enterprises and parastatals which forced the government to
come up with reforms aimed at regularising operations of state enterprises and parastatals.
As a result, state enterprises are now required to be accountable, transparent and self-
sustainable.

The functions of the Board in corporate governance is becoming less compromised as

management and CEOs are left to manage in a way that is focused on personal and self-
actualisation than improving the performance of the organisation. Boards are not effectively
manging the implementation phases of the policy as there is little evidence or review of
Board involvement on policy implementation and evaluation.

In most cases of poor corporate governance, most of the faults points to ineffective boards of
directors thus reinforcing the need for effective boards to prevent further abuse of office by
parastatal directors. Effective boards will therefore have a significant impact on the state of
corporate governance in Zimbabwe. There is therefore a glaring need to understand the issues
that make boards more efficient and effective in performing duties. Currently evidence
points out that CEOs and directors of organisations, engage on a spree of misconduct before
the board realises what is going on which further emphasises the ineffectiveness of the
boards.

Statement of the problem

State enterprises and parastatals in Zimbabwe have been hard hit by challenges emanating
from poor corporate governance structures and processes. Problems include abuse of office,
misuse of funds, inappropriate procurement procedures, fraud and corruption. These have had
a negative impact on service delivery, organisational performance and national economic
development. Therefore there is strong need for accountability and clear governance
procedures for the good of the Zimbabwean public which is a major stakeholder in the
Zimbabwean state enterprises and parastatals. When all these misconducts, problems and
challenges are taking place within an organisation the functions of the board are questioned.
Purpose of the study

The study aims at developing a conceptual framework to investigate the relationship between
board structure, functions and processes on organisational performance in state enterprises
and parastatals of Zimbabwe. The study will also contribute to the corporate governance
literature in Zimbabwe.

Research objectives

1. To determine the levels of compliance with corporate governance principles by

Zimbabwean parastatals and state enterprises
2. To determine the relationship between corporate governance and organisational
performance
3. To identify and examine the key factors that lead to effective board of directors which
contributes towards better performance
4. To ascertain the integration of board of directors functions, responsibilities and
processes in the implementation of policies

Research Questions

1. What are the reasons for increased corporate governance problems in state enterprises
and parastatals in Zimbabwe?
2. What is the importance of the code of corporate governance in a public institution?
3. What is the relationship between corporate governance and organisational
performance?
4. How does the board structure, functions and processes affect organisational
performance?
5. What ids the role of the board of directors in the operations of an organisation?

Significance of the research

The research will fill in an essential gap by contributing to the knowledge on the performance
and effectiveness of board of directors. It will also contribute to an increased understanding
of the board dynamics while giving important insights into issues to be considered when
selecting parastatals and state enterprises boards.
 It will also shade more light on how the board can engage and manage policy
implementation by organisations and company level and ensure adherence, transparency and
accountability.

Although there are lots of researches on the effects of board structure on organisational
performance, this study will introduce an additional dimension of board functions and
processes in the corporate governance and performance framework

Assumptions

1. Good corporate governance is key to better organisational performance

2. All state enterprises and parastatals are governed by a board of directors
3. The management in parastatals and state enterprises are knowledgeable about the
principles of good corporate governance and its importance in organisational
performance

Hypothesis

H1a: Corporate governance practices have a stronger influence on organisational performance

Delimitations of the Study

• The study will be limited to state owned enterprises focusing mainly on their head
offices domiciled in Harare

• Focus will be on Netone, Zbc and Zupco

Limitations of the study

1. The research will only be limited to state enterprises and parastatals leaving the
private sector which is important in development.
2. Management in state enterprises may not reveal some confidential information that is
of importance to this research
 CHAPTER 2: LITERATURE REVIEW

Introduction

Corporate governance has attracted a great deal of attention because of its impact on the
economic standing of nations. It has significant impacts on the growth prospect of an
economy, numerous global and local corporate failures have brought to the fore the need for
sound corporate governance. In order to fully understand the impact of corporate governance
in organisational performance, a review of it is important. This chapter traces the
development of corporate governance and its impact on organisational performance through a
review of literature in the following areas: history and evolution of corporate governance,
definition of corporate governance, principles of corporate governance , benefits of good
corporate governance, theories of corporate governance, international corporate governance,
corporate governance in Zimbabwe, state owned enterprises and the fundamentals of an
effective board of directors.

History of corporate governance

Corporate governance has always been with us for as long as the corporate form has allowed
the conflicts between investors and managers, [ CITATION Wel10 \l 2057 ] . It is largely a
response to the agency problem that is created by the separation of ownership and control.
The history of corporate governance correspondingly extends back to at least the formation
of the East India Company, the Hudson Bay Company, the Levant Company and other
charted companies launched in the 16th to 17th centuries,[CITATION Che12 \l 2057 ]. The
business development from the 16th to the 20th centuries would give rise to the modern
corporation that is complex in nature where management has to be separated from the
ownership. Technological advances and expansion of markets increased the scale and
complexity of the enterprise requiring additional capital [ CITATION Clarke \l 2057 ].
Consequently, corporate governance structures evolved in different corporate forms to pursue
opportunities and resolve new economic problems arising at that time [CITATION Kam11 \p
29 \l 2057 ].

Today corporate governance is a complex mosaic consisting of laws, regulations, public

institutions, professional associations and code of ethics [CITATION Kam11 \p 16 \l 2057 ]. The
concept has been adopted in different parts of the world with different but major variations
because of the different circumstances in each country [CITATION Bur13 \p 17 \l 2057 ] .
Although there has been different views with regards the birth of corporate governance, the
common position is that corporate governance has been in existence for a long time. The
interpretation of the term has also been subject of debate. There however seems to be
consensus on what the term actually concerns. Different corporate governance frameworks
were developed depending on each country’s circumstances with two main approaches
separated by the legal system in each country. Mulili and Wong (2011, p. 2).

Civil law jurisdictions such as France, Germany and Italy developed the insider model of
corporate governance which recognised that the greatest control of the firm is held by those
close to the firm’s day to day activities, [ CITATION Tul05 \l 2057 ]. In this case corporate
governance aimed at balancing the interests of key groups such as managers, employees,
creditors, suppliers, customers and the community at large.

On the other hand common law jurisdictions such as the United Kingdom and United Sates of
America adopted a shareholder oriented corporate governance system [CITATION Bur13 \p 7 \l
2057 ]. This meant that management would be held accountable to the owners of the business
who would set the goals and objectives of the company [ CITATION Mul11 \l 2057 ]. This is
known as the outsider approach and it recognises the gap between management and
shareholders of the firm [ CITATION Tul05 \l 2057 ]

Corporate governance definition

Sir Adrian Cadbury (1992, p. 14) defines corporate governance as a system by which
companies are directed and controlled. Similarly, the Zimbabwe Corporate Governance
Framework as Cited by Moyo (2016, p.15) defines as a set of processes, value codes,
policies, laws and structures governing the way a corporation is directed controlled and held
accountable. The two views opines that corporate governance focuses on the internal systems
of the organisation’s operations that has a bearing on the decision making process.

Cadbury 2000 goes on to give a broader definition that has a stakeholder orientation where
he says

Corporate governance is concerned with holding the balance between economic and
social goals and between individual and communal goals. The governance framework
 in these seeks to encourage the efficient use of resources and equally to require
accountability for the stewardship of these resources. The aim is to align as nearly as
possible the interest of individuals, corporations and society. The incentive to
corporations is to achieve their corporate aims, and to attract investment. The
incentive for the state is to strengthen their economies and discourage fraud and
mismanagement.

This definition takes into account the wider implications of corporate governance that looks
beyond the firm to look at the economic, social well-being stability and equality of society.
(Kamudini ).

According to the OECD (2015, p. 9) Corporate governance involves a set of relationships

between a company’s management, its board, its shareholders and other stakeholders.it also
provides the structure through which the objectives of the company are set, the means to
attaining these objectives and performance monitoring are determined. The OECD
definition is much broader as it does not only look at the internal aspect but also takes into
account other stakeholders and their impact on the economy. It also entails that a company
abide by the provisions of relevant statutes, societal norms, standards and codes of best
practices as well as manage the company reliably, Van der Merwe (2009, p. 3) .

In support of this view Crowther and Seifi (2011, p. 12) defines corporate governance as an
environment of trust, ethics, moral values and confidence – as a synergic effort of all
constituent parts. These include stakeholders, including the government, general public and
professional service providers as well as the corporate sector.

The above definitions reveal that corporate governance aims at finding common ground on
the relationship and interests of key stakeholders to achieve organisational goals. There is
however contrast between the narrow ad broader definitions of corporate governance the
narrow definition is concerned with stakeholders’ rights whereas the broader definition
takes on board all stakeholders such as managers employees creditors , suppliers and the
greater community Burner (2013, p. 213). The broad definition considers that companies are
accountable to the society, future generations and the natural world. Solomon (2007, p.14).
 CHAPTER 3: RESEARCH METHODOLOGY

Introduction

As stated above, the research aims at developing a conceptual framework to investigate the
relationship between board structure, functions and processes on the performance of State
Owned Enterprises. The research wills therefore asses the effectiveness of Zimbabwean
corporate governance frameworks, in enhancing the performance of State Owned Enterprises.
This chapter discusses the research methodology to be used in the study and the context
within which the research will be conducted. It will look at the research design, research
methods sampling design and data collection methods

Research Methodology

Research methodology refers to the overarching theoretical and philosophical frameworks

that guide the research Dawson (2002, p. 14). It studies the various steps adopted by the
researcher in studying the problem along with the logic behind them, Surbhi (2016, p. 2).
This involves the rigorous analysis of the methods applied in the stream of research to ensure
that conclusions drawn are valid reliable and credible.

An analysis of the structure, functions and processes of Boards of Directors in the selected
SOEs and how this affects the performance of the organisation will be done using a mixed
research approach. The rationale for selecting that approach will aptly be described and a
discussion on the sampling and data collection techniques will also be done in this chapter.

Research Design

Burns and Groove, (2003, p. 195) define research design as a blueprint for conducting a study
with maximum control over factors that may interfere in the validity of findings. It is the
researcher’s overall tool for answering the research question or testing the research
hypothesis, Polit, (2001, p. 67). The research design spells out the strategy that the researcher
plans to adopt to develop information that is accurate and interpretable while guiding the
researcher to plan and implement the study to achieve the intended goal. It looks at the
research method, sample and data collection techniques and procedures Yin (2008, p. 23).

To analyse the effects of board structure, functions and processes on company performance,
the research will examine literature in books, electronic sources, journal and newspaper
articles, published and unpublished papers, theses and dissertations, published and
unpublished papers as well as annual and other reports. Information gathered through these
means will be enhanced by information gathered through questionnaires and face to face
interviews with key people in identified state enterprises. All the data gathered using the
above mentioned means will be analysed and presented in both qualitative and qualitative
formats.

Research methods
These are plans and procedures for research that span the steps from broad assumptions to
detailed methods of data collection analysis and interpretation, Dawson (2014). The choice
of an approach should be informed by the overall philosophical assumptions of the research
and specific methods of data collection, analysis and interpretation. Research can either be
positivist (quantitative) or phenomenological (qualitative) Collis and Hussey (2003). The
positivist approach examines social phenomenon by assigning numeric values that are
analysed using statistical methods while the phenomenological is an inquiry useful for
exploring and understanding central phenomenon Creswell (2002, p. 596). Of late
researchers have preferred mixing the two to cover up for the weaknesses of each type of
research, thus the birth of the mixed approach to research. This research will integrate the
two types of research to use the mixed approach to offset the shortcomings of each of the
methods.

Qualitative (Phenomenological) research

Holloway and Wheeler (2002, p. 30) defines qualitative research as a form of social inquiry
that focuses on the way people interpret and make sense of their experience and the world in
which they live in. Researchers use the qualitative approach to explore the behaviour,
perspectives, experiences and feelings of people and emphasise the understanding of these
elements. This is premised on the idea that human experience is a valuable source of data as
opposed to the quantitative aspect focusing on measuring the existence of physical
phenomenon Dawson (2002, p. 15). Qualitative research generally focuses on meaning
rather than the measurement of social problems Lester (1999, p. 2). It is therefore effective in
exploring experiences, perceptions and feelings of individuals subjectively thus obtaining
elaborate and comprehensive information.

Quantitative (Positivist) research

Quantitative research is an approach for testing objective theories by examining the
relationship among variables Creswell (2014). These variables can then be measured so that
data can be analysed using statistical methods. With qualitative research, clearly construed
hypothesis are formulated about the relationship between the variables and the relationship is
measured by means of statistical methods Struwig and Stead (2004, p. 7). To establish the
correctness of results, quantitative research is evaluated using three criteria namely validity,
reliability and generalisability.

Validity
This refers to the degree to which data gives a true and correct reflection of what it purports
to measure.

Reliability
Refers to the consistency of results from the supplied data and the extent to which the data is
free from random or unstable errors Ng and Coakes (2014)

Generalisability
This is defined as the extent to which the findings of a study can be applied externally or
more broadly outside the study context Myres (2000)

Mixed methods research

This involves collecting both quantitative and qualitative data, integrating the two forms of
data, and using distinct designs that may involve philosophical assumptions and theoretical
frameworks Creswel (2014). The core assumption of this form of inquiry is that the
combination of qualitative and quantitative approaches provides a more complete
understanding of a research problem than either approach alone. The current research will
use this approach as there is possibility of gaining in the breadth and depth of understanding
and corroboration while offsetting the weakness inherent in using each approach by itself.

Sampling
Sampling is the process in which a representative part of a population for the purposes of
determining the parameters or characteristics of the whole population is selected, Kothari
(2004 p 56). A population is a group of individuals, persons or objects from which samples
are taken for measurement. (Ibid) Zimbabwe has 90 parastatals, Zivira (2014) and state
owned enterprises established by specific Acts of Parliament. The statues forming these
public entities have similar provisions in terms of governance and they only differ in terms of
the entity’s mandate powers and objectives, Moyo (2016, p. 37). Based on this, a sample of
five State Owned Enterprises will be selected using the purposive sampling technique to help
in understanding the functions, processes and structure of the boards and how this relates to
company performance. The purpose of sampling was the huge costs that would be involved
in testing the entire population. It will also be impossible to test the entire population due to
the difficulties that will likely be faced in accessing all the state owned enterprises. More so
due to the huge number of SOEs, the population becomes huge and testing it in its entirety
will likely produce errors that may distort the whole research.

The researcher seeks to understand the implementation of corporate governance in

Zimbabwe and the performance of the five selected SOEs from the perspectives of their
boards of directors, chief executive officers, company secretaries, senior management as well
as selected shareholders and their representatives. In this case Government is the major
shareholder and its interests are safeguarded by the Parent Ministry while public interest is
expressed through the parliament. The research will therefore seek the opinion of senior
management in the respective ministries as well as members of the Parliamentary Portfolio
Committee under which the SOEs fall.

The main reason for selecting the above mentioned participants is their significant role in
making decisions that determine the company’s direction thus playing a major part in the
implementation of corporate governance principles. It was also the researcher’s
consideration that people at such levels will also normally have relevant experience and
reasonable understanding of corporate governance and they will thus provide informed and
comprehensive answers to research questions.

Sources of Data
According to Gitlow, et al. (2015) that data is information collected about a product, service,
process, individual, item, or thing. In order to achieve the objectives of this research both
primary and secondary data sources will be explored.

Primary Data
Primary data is data which is collected for the specific research problem using procedures
that fit the research problem, Hox and Boeije (2013, p. 1). It is original in nature and is
directly related to the issue or problem. Primary data will be collected through interviews
and questionnaires.

Questionnaires
A questionnaire is a research instrument consisting of a series of questions and other prompts
for the purpose of gathering information from respondents Cohen et al (2007 p 245). The
research will make use of both open ended and closed questions. Open ended questions will
allow participants to give adequate answers in their own words and they freely express their
opinions while giving recommendations and criticism without the limit of available option in
closed questions. However responses in open ended questions are difficult to code and
classify Cohen (Ibid).

Limitations of the open ended questionnaires will be countered by the use of closed questions
that prescribe a range of responses from which respondents can choose the appropriate
response. This will make it easier and quicker for respondents to answer while reducing the
chances of irrelevant and confused answers.

Questionnaires will be designed to cover aspects such as personal information, general

corporate governance knowledge, role of the board, appointment of the board, composition,
structure, remuneration of the board evaluation of company performance and general
recommendations.
Interviews
An interview is an interchange of views between two or more people on a topic of mutual
interest, sees the centrality of human interaction for knowledge production and emphasises
the social situatedness of research data, Kvale 1996 as cited by Cohen et al (2007 p 267).
The use of interviews in research marks the move away from seeing human beings as simply
manipulable and data as somehow external to individuals and towards regarding knowledge
as generated between human beings often through conversations Cohen et al (2007 p 267).
Interviews will be used to explore and analyse views, experiences and beliefs while providing
a deeper understanding of the issues involved. The research will employ the semi-structured
interviewing format that will enable the probing and understanding of meaning attitudes,
opinions and participant’s personal experiences by asking follow up questions for further
clarification making it possible to further explore pertinent information that may have been
omitted

Secondary data
Secondary research involves the collection of information from studies that others have made
of a subject, Dawson (2002p 40). Secondary data will contribute towards the formation of
background information needed by the researcher while constructively building the research
so that the reader may be able to thoroughly comprehend the research outcome.

Research information will be obtained through the study of books, electronic journals,
internet sources, journal articles, newspaper articles, theses, dissertations publish and
unpublished papers. Publicly available information concerning the selected SOEs such as
company reports, audited accounts enabling statutes and websites will also be to corroborate
assertions made in interviews and questionnaire responses while obtaining additional that
may have been left out.

The research will also make use of public information on corporate governance that has a
bearing on corporate governance in Zimbabwe as a whole that has a reflection of the five
selected SOEs. Information will be sought from the Auditor General’s annual reports and
Institute of Directors’ (IODZ) annual reports.
Data Analysis
The data collected from primary and secondary sources will be analysed by using appropriate
statistical tools to approve or disapprove the hypothesis.

Khandker, R. S.
(2003)
“
Micro
-
finance
and Poverty: Evidence
Using Panel Data from
Bangladesh
”
, World Bank Policy Research Working Paper 2945, Washington, U
SA
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