The International Monetary Fund has identified the politicisation of board and chief executive appointments as a major weakness in the governance of Ghana's state-owned enterprises, warning that the practice is undermining the independence and professionalism of boards.

In its latest Technical Assistance Report on Ghana's state-owned enterprises in 2024, the IMF says that while Ghana has established a framework intended to make appointments more structured and merit-based, "in practice appointments remain highly political and centralised in the Presidency."

The report says boards of major state-owned enterprises are largely dominated by political appointees, with board chairs frequently being ministers, Members of Parliament or prominent party officials.

The Fund gave a specific example of the Ghana Ports and Harbours Authority (GPHA), where the board was chaired by the national chairman of the governing party — an arrangement that did not change with the change in government in 2025. The Volta River Authority (VRA) was also cited for having prominent politicians on the board alongside technocrats and a traditional leader.

The IMF says such arrangements represent a significant departure from OECD standards, which caution against active politicians serving on SOE boards and emphasise independent and professional majorities.

Political appointments weaken accountability

The IMF's concern goes beyond the political identity of individual board members. It argues that when boards are not sufficiently independent, their ability to properly oversee management can be weakened.

The report says CEO appointments also remain largely political, with SOE boards playing only a limited role. Chief executives or managing directors are typically appointed by the President, often in consultation with the relevant minister, rather than being selected by the board through a competitive process. According to the IMF, this weakens the accountability link between board oversight and management performance.

The report says the absence of clear, transparent and merit-based procedures for key appointments increases the risk of politicisation, weakens accountability and can undermine board effectiveness and fiduciary responsibility.

It also notes that there is limited public disclosure of the criteria used to select board members and executives and the results of their evaluations.

COCOBOD also cited

The IMF identifies political influence in another major state enterprise — the Ghana Cocoa Board (COCOBOD). The report describes COCOBOD as having a "politicised committee ecosystem" and says its Finance Committee was led by senior political figures.

While recognising that the committees focus on important areas, the IMF says the heavy political leadership of key committees limits their independence and could make it more difficult to balance commercial objectives with the organisation's social responsibilities.

The report therefore presents the issue as broader than individual appointments.

It identifies politicised appointments, insufficient separation between ownership and policy roles, and weak SOE transparency as three systemic weaknesses that continue to constrain progress in Ghana's state-owned enterprise sector.

Energy and roads sectors also raise concerns

The governance concerns are reinforced by the IMF's observations on financial and procurement irregularities. The report says the biggest portion of irregularities identified by the Auditor General occurred in SOEs within the energy and roads construction sectors.

It says these instances point to ineffective or unethical management practices, political interference and poor oversight by corporate boards. This connects governance directly to the financial performance of SOEs.

Ghana's state enterprises control significant public assets and operate in strategically important areas including energy, ports, agriculture, finance and infrastructure. Weak oversight can therefore have consequences that extend beyond individual companies to the public finances.

The fiscal cost of weak governance

The IMF's concerns come against the backdrop of substantial financial risks in the SOE sector.

Aggregate SOE liabilities stood at about GH¢282 billion in 2024, equivalent to roughly 25 per cent of GDP. The ten largest SOEs accounted for approximately 85 per cent of total liabilities, with ECG, VRA and COCOBOD among the enterprises identified as carrying the greatest fiscal risks.

The Fund says SOEs can create fiscal risks through government support, government-backed borrowing, arrears and quasi-fiscal activities. That makes governance particularly important.

When a state-owned enterprise accumulates losses or debt and eventually requires government intervention, the financial consequences can ultimately be transferred to the taxpayer.

The question, therefore, is whether the people making decisions in these enterprises can be held independently accountable for those decisions.

IMF calls for merit-based appointments

The IMF says Ghana already has the architecture for a more professional appointment system. The State Ownership Policy requires the State Interests and Governance Authority (SIGA) to develop a nomination framework for identifying, vetting and shortlisting candidates for board and CEO positions, creating a pool of potential directors and establishing procedures for removals.

But the Fund says the framework is still at an early stage of implementation.

It recommends operationalising a genuinely merit-based and transparent process for appointing boards and CEOs, progressively reducing the number of active politicians on SOE boards and replacing them with independent professionals and sector experts.

The IMF also says board members should receive structured training in corporate governance and board effectiveness, particularly given the difficulty of finding suitably skilled and experienced candidates in some technical sectors.

A governance issue with a financial consequence

The IMF's assessment ultimately raises a question that goes beyond political appointments.

Can Ghana expect its state-owned enterprises to become financially sustainable if the institutions responsible for overseeing them are not sufficiently independent and professional?

For a sector carrying hundreds of billions of cedis in liabilities, the issue is not simply who gets appointed to a board.

It is whether boards have the independence to challenge management, whether chief executives are selected on competence and performance, and whether those entrusted with managing public assets can be held accountable for the results.

The IMF's recommendation is clear: Ghana needs to move from a framework that exists largely on paper to a system in which merit, independence, professional expertise and performance determine who governs the country's state-owned enterprises.