Curatorship Paradox: Corporate Governance in Dilemma

Abstract

The Zimbabwean financial sector has witnessed financial institutions failures and placing these institutions under curatorship has been the solution. In most cases curators have not been able to bring the banks to the original position instead they have fast tracked the liquidation of these institutions. Since 2004, more than 15 financial institutions have been placed under curatorship by the Reserve Bank of Zimbabwe. Accountants have been found to be prominent appointed curators and they have been found to facilitate the liquidation of these institutions rather than resuscitating them and as a result corporate governance has been found to be in dilemma. Curatorship has been found to be a lucrative business for accountants and lawyers whose main jobs have been to facilitate the winding up of companies rather than turning them around. The costs of placing a financial institution under curator have been high to such an extent that huge sums of money have been paid which could have been channelled towards turning around it. Curators in most cases as indicated in this study have not helped financial institutions to perform better instead they have worsened it.The paper used a document review research method to show how corporate governance has been placed in dilemma by appointing accountants as curators and how they have facilitated the winding up of these institutions rather than bringing them back to position.

Article Type: Discussion paper

Keywords: curatorship, paradox, dilemma, financial institution

DOI: 10.7176/PPAR/9-9-01

Publication date:September 30^th 2019