The International Monetary Fund (IMF) has warned that appointing active politicians to the boards of Ghana’s State-Owned Enterprises (SOEs) weakens corporate governance. This practice also undermines accountability and effective oversight of these critical entities. The warning highlights a significant challenge to the financial health and operational efficiency of Ghana’s public sector.
This caution comes from the IMF’s July 2026 Technical Assistance Report. The report, titled “Advancing SOE Fiscal Risks Management, Financial Oversight, Governance, and Investment Implementation,” details the risks. It notes that Ghana’s legal framework supports merit-based appointments. However, the selection of major SOE boards remains highly centralised, with strong influence from the Presidency. This centralisation can compromise the independence required for robust oversight.
This issue fits into Ghana’s broader economic narrative of managing public finances and reducing fiscal risks. SOEs often contribute significantly to government debt and contingent liabilities. For instance, related reports indicate that SOE liabilities are a growing concern. The Electricity Company of Ghana (ECG) alone accounts for GHS 71 billion of these liabilities. This underscores the urgent need for improved governance to prevent further financial strain on the national budget.
The IMF report specifically cited the Ghana Ports and Harbours Authority (GPHA) as an example. Its 10-member board is chaired by the national chairman of the governing party. The Volta River Authority (VRA) also features prominent politicians alongside technocrats and traditional leaders on its board. “In practice, boards of major SOEs are largely dominated by political appointees,” the report stated. It added that board chairs are frequently ministers, members of parliament, or prominent party officials.
The Fund further warned that this appointment structure undermines the independence of SOE boards. Boards may influence the tenure of chief executives, but they do not ultimately control their appointments. This situation can discourage boards from challenging management decisions. It also creates incentives for CEOs to respond more to political principals than to the boards overseeing their performance. This dynamic can lead to decisions that prioritise political expediency over sound business practices.
The IMF is therefore calling for formal, transparent, and merit-based procedures for appointments. They recommend clear competency profiles and standardised vetting for SOE board members and chief executives. Implementing these reforms would strengthen the independence and effectiveness of SOE governance. It would also help ensure that SOEs operate efficiently and contribute positively to Ghana’s economy.
Moving forward, stakeholders will closely watch the government’s response to these recommendations. Effective reforms could improve SOE financial performance and reduce fiscal risks. Failure to address these governance issues could exacerbate existing liabilities and hinder economic stability. Investors and international partners will monitor Ghana’s commitment to strengthening public sector institutions. This is crucial for maintaining confidence in the country’s economic management.
The government’s efforts to reform SOEs have not yet translated into improved financial performance, according to the IMF. This highlights the deep-seated nature of the challenges. Addressing political interference in SOE appointments is a critical step towards achieving sustainable economic growth. It will also ensure that these vital national assets serve the public interest effectively and efficiently.