Keeping up Appearances: The Quest for Governance Legitimacy

Abstract

An effective corporate governance structure is as crucial to a public sector organisation as it is to a private sector organisation. This paper reviews the profile of directors on governance boards of government controlled organisations and finds that, while the governance structures are similar with those in the private sector, the real power to set the strategic, financial and operational directions of these organisations is not in the hands of the directors, as it is in the private sector, but in the hands of the responsible ministers. This de-coupling, it is argued, is due to the perception that private sector governance practices are superior to public sector practices and therefore these government organisations, in an attempt to maintain the appearance of good governance and to legitimise their place in society, have adopted on the surface private sector governance structures and practices.

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