Chief Economist at the Policy Initiative for Economic Development (PIED), Daniel Anim-Prempeh, has stressed the need for merit-based appointments in State-Owned Enterprises (SOEs) to enhance their performance.

He said this on The Pulse on JoyNews, during a discussion on the state of SOEs following President Mahama’s call for a complete reset of these entities to drive transformation.

The President made this appeal during a meeting with Chief Executives of specified entities under the State Interest and Governance Authority (SIGA) on Thursday, March 13.

Read Also: Many SOEs have been used as mere instruments for personal wealth accumulation – Mahama

According to Anim-Prempeh, political influence in SOE appointments undermines efficiency.

“My view is that the genesis of the problem lies in the appointments. Because SOE managers are appointed by the President, there is often a psychological perception that the role is a reward for party loyalty rather than competence,” he stated.

He suggested outsourcing the appointment process to an independent management firm to ensure that the most qualified individuals are selected based on merit.

“If appointments are outsourced through management firms where people go through a proper selection process, we can disconnect the psychological and political affiliation that managers feel towards the appointing authority. Instead, they should be given clear performance indicators to guide their work,” he added.

Read Also: Loss-making SOEs will not be tolerated – Mahama warns

Mr Anim-Prempeh also highlighted the need for an independent board selection process. “If board composition is handled by a third party on behalf of the President, we will know that appointments are purely based on merit,” he said.

He emphasised that political interference remains a significant challenge. “Until we separate political affiliation from SOE appointments and management, and reduce political interference from the seat of government, these institutions will struggle to perform efficiently,” he said.

"If you bring a private person on board, he is bringing on board sound management, he is bringing on board efficiency, accountability and transparency, and that is the reason a private person will succeed. If we can apply the same, my view is that we may not need a private person yet we can still perform as efficiently as any private person that may come on board," he added.

Read Also: ‘Even GIHOC that produces alcohol is making losses’ – Finance Minister expresses surprise