PAPER
ANONYMOUS
EXECUTIVE SUMMARY
Consequently, the study identified the critical challenges confronting corporate governance
practices in Ghanaian churches, using Holy Spirit Cathedral Church (HSCC) as a case study
organization. Purposive sampling using questionnaire instrumentation was used to collect data
from congregants and employees of HSCC. Percentage Scorings (PS) and frequency rates were
employed to rank the critical challenges associated with sound CG practices during the study.
The results indicated that 5 critical challenges confronting CG practices were as follows: Inability
to develop social capital, weak regulatory framework, non – stringent financial management
processes, over-reliance on informal processes based on shared norms and values of delivering
humanitarian services rather than on formalized procedures as well as financial control system is
often tied up with church projects’ funds received from a particular donor (agency).
It is recommended that stakeholders, policy makers in addition to the clergy should adhere strictly
to Agency, Legalistic Perspective, Stewardship, Resource Dependency, Democratic Perspective,
Justice, Institutional, Equity, ERG frameworks and the like to effective manage the crippling
parameters associated with sound corporate governance practices in Ghana and beyond.
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TABLE OF CONTENTS
EXECUTIVE SUMMARY ......................................................................................................................... i
LIST OF TABLES ..................................................................................................................................... iv
LIST OF FIGURES .................................................................................................................................... v
INTRODUCTION....................................................................................................................................... 1
1.0 Introduction ........................................................................................................................................... 1
1.1 Background to the Study ...................................................................................................................... 1
1.2 Problem Statement................................................................................................................................ 4
1.3 Aims and Objectives of the Study ........................................................................................................ 6
1.4 Research Questions ............................................................................................................................... 6
REVIEW OF LITERATURE .................................................................................................................... 7
2.1 Introduction ........................................................................................................................................... 7
2.2 Conceptual Framework on Corporate Governance .......................................................................... 7
2.3 Theoretical Framework on Corporate Governance .......................................................................... 8
2.4 Responsibilities and Functions of a Board of Directors (BODs) ..................................................... 10
2.4.1 Responsibilities ................................................................................................................................. 10
2.4.2 Functions........................................................................................................................................... 10
2.4.3 Composition of Board of Directors................................................................................................. 11
2.4.4 The Role of Shareholders ................................................................................................................ 12
2.4.4.1 Shareholders’ Rights and Privileges ........................................................................................... 12
2.4.5 The Role of Audit Committee ......................................................................................................... 12
2.5 Traditional Corporate Governance Theory ..................................................................................... 13
2.5.1 Agency Theory ................................................................................................................................. 13
2.5.2 Legalistic Perspective Theory ......................................................................................................... 13
2.5.3 Stewardship Theory ......................................................................................................................... 14
2.5.4 Resource Dependency Theory......................................................................................................... 14
2.5.5 Democratic Perspective ................................................................................................................... 14
2.5.6 Stakeholder Theory ......................................................................................................................... 15
2.5.7 Managerial Hegemony Theory ....................................................................................................... 15
2.5.8 Institutional Theory ......................................................................................................................... 15
2.6 Holistic Corporate Governance Theory ............................................................................................ 15
2.7 Corporate governance process ........................................................................................................... 17
2.8 Theologically-Based Principles of Good Church Governance ........................................................ 18
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2.9 Critical Challenges Confronting CG Practices in Faith-Based Organizations (FBOs) ................ 20
2.10 Brief History of the Roman Catholic Church (Globally) .............................................................. 23
2.10.1 Origin of the Roman Catholic Church ......................................................................................... 24
2.10.2 Historical Perspective of the Roman Catholic Church (Africa) ................................................ 25
2.10.2.1 History.......................................................................................................................................... 26
2.10.3 Overview of the Roman Catholic Church (Ghana) .................................................................... 26
2.10.4 Profile of Holy Spirit Cathedral Church (Adabraka) ................................................................ 28
RESEARCH METHODOLOGY ............................................................................................................ 30
3.0 Introduction ......................................................................................................................................... 30
3.1 Research Design .................................................................................................................................. 30
3.2 Population and Sample Size ............................................................................................................... 30
3.3 Data Collection Procedure ................................................................................................................. 30
3.4 Data Analysis ....................................................................................................................................... 31
3.5 Reliability and Validity....................................................................................................................... 31
3.6 Ethical Considerations........................................................................................................................ 32
RESULTS AND DISCUSSION ............................................................................................................... 33
4.1 Introduction ......................................................................................................................................... 33
4.2 Bio - Data Attributes of Participants................................................................................................. 33
4.3 Achievement of Objectives ................................................................................................................. 38
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS........................................................... 39
5.1 Overview .............................................................................................................................................. 39
5.2 Summary.............................................................................................................................................. 39
5.3 Conclusions .......................................................................................................................................... 40
5.4 Recommendations ............................................................................................................................... 40
5.4 Limitations of the Study ..................................................................................................................... 41
REFERENCES .......................................................................................................................................... 42
APPENDICES ........................................................................................................................................... 49
APPENDIX 1 –TABLES .......................................................................................................................... 49
APPENDIX 2 – QUESTIONNAIRE ....................................................................................................... 50
iii
LIST OF TABLES
Table 4.6 Respondents’ View on the Critical Challenges Confronting Corporate Governance
iv
LIST OF FIGURES
v
INTRODUCTION
1.0 Introduction
This chapter, which accentuates on the study overview presents the research context in terms of
the background of the study and statement of the research problem to be addressed. Subsequently,
the aim and objectives are presented followed by the main research questions adopted.
Most fundamentally, these involve tensions between expectations that institutional recipients of
public funds be accountable in terms of fiduciary duties, standards of service, and regard for the
right of clients and legal and constitutional protections of religious groups' autonomy. The
resolution of these tensions has been complicated not only by an on-going transformation in the
legal treatment of nonprofits generally, which has led legislators, jurists, and the public to expect
higher degrees of transparency, but also a continuing elaboration of "line blurring organizational
forms," especially the quasi-private and mixed public-private entities that have “taken center stage
in the era of privatization” (Panel Discussion 2001, 1357). Shifts in religious demography have
further complicated questions of accountability, as number of religions, the diversity of their
beliefs, practices, and organizational characteristics, and the variety of ways they engage in public
life have grown tremendously (Gilman, 2002).
In today’s global economy, the success of the national economy depends on the crucial role of
organizations’ competitiveness, transparency and governance structure which operate within her
territory, since organizations are the entities that create economic value (ICAN, 2009). Indeed, the
need for trust and transparency in the governance of corporate organizations has been one of
concern for standard setters all over the world. This need has obviously spurred renewed interest
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in the corporate governance practices of modern corporations, particularly in relation to
accountability and economic performance (ICAN, 2009).
The position above could not be separated from prior submission where Nwachukwu (2007)
emphasize the growing consensus that good corporate governance has positive link to national
economic growth and development. The degree of trust accorded to the managers of companies
by its owners is strengthened through corporate governance. Directors without corporate
governance mechanism may paint misleading pictures of financial and economic performance of
their company to lure unsuspecting investors. Such window dressed accounts raised concern in the
U.S.A. with the collapse of the energy corporation ENRON in 2001 which filed for bankruptcy
after adjusting its accounts (Demaki, 2011). Worldcom, Global Crossing and Rank Xerox are other
companies in the U.S.A with similar problem. The increasing incidence of corporate fraud relating
to exaggerated and fleeting reports have reinforced the renewed global emphasis on the need for
effective corporate governance. CBN (2006) reported that despite the significance of good
corporate governance to national economic development and growth, corporate governance was
still at rudimentary stage as only 40% of publicly quoted companies, including banks had
recognized corporate governance in place.
The separation of ownership from the management of business organizations spurs a divergence
of interest amongst the parties. The divergence of the interests of the management and its owners
has undermined investors’ confidence in the Board. Hence, investors are interested about the level
of accountability displayed by the Board of directors. The outcry of investors and other
stakeholders as a result of mismanagement and inadequate financial disclosures given by the
management has deemed it necessary for the institution of sound corporate governance procedures.
Furthermore, there appears to be nothing new about direct and indirect public subsidy of
religiously-tied service providers (Monsma, 1996; Hall, 2002): tax exemption and deductibility of
donations, as well as grants, contracts, and vouchers have long been used by governments to defray
the costs of caring for the dependent and disabled by entities owned, controlled, or significantly
related to religious bodies.
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In recent years, however, not only has the proportion of government subsidized services provided
by faith-based organizations grown, but the range of services and types of organizations through
which they are provided has grown more varied and diverse.
Historically, educational and social services provided by religious bodies and faith-based
organizations focused on traditional objects of charity – the young, the poor, the sick, and the
disabled (Rosin, 2001; Mutterperl, 2002). Since the 1960s, they have expanded to include job
training, community and economic development, housing, substance abuse programs, refugee
placement, and many other activities.
Again, while services were historically provided either directly by religious bodies and their
members or by secular corporations controlled by them, today faith based organizations can range
from para-denominational organizations like Habitat for Humanity, a secular corporation run by
people of faith but with no formal ties to any religious body (Baggett, 2001) and secular youth
services agencies run by members of religious orders governed by lay boards of directors and
funded largely by government, through day schools and community development corporations
controlled formally or informally by religious bodies (Gilman, 2002; Rosin, 2001).
As the scope, scale, and range of services provided by faith-based organizations has expanded and
their dependence on government funding has increased, the need for resolution of unanswered
questions about their accountability has intensified. On the one hand, the growing scale of
government subvention has inevitably brought with it higher standards of fiduciary responsibility
and financial management, along with mandates for performance evaluation and public reporting.
On the other hand, to the extent that they continue to depend significantly on private support,
religious bodies and faith-based organizations have become entangled in the general crisis of
accountability that has affected corporate management and governance – for-profit and nonprofit
alike: today, questions about financial improprieties, self-dealing, conflicts of interest, and public
disclosure are as likely to be raised about religious organizations as about secular ones. In addition,
the expanding range of service industries in which faith-based providers operate renders them
subject to a wide variety of industry specific regulatory regimes involving licensing, standards of
care, public health and safety, land use, and the legal rights of clients (Rosin, 2001).
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Finally, in an era of class action aggressive tort litigation that began in the 1960s, stakeholders –
community groups, client groups, rights advocates, and other organized interests affected by the
activities of faith-based organizations – have become steadily more vocal and influential in
demanding accountability (e.g., the role of lay groups like Voice of the Faithful in the Catholic
Church’s sex abuse scandals), popularly referred to bad corporate governance practices
(Investigative Staff of the Boston Globe, 2001).
The main objective of the paper is to examine the relationship between corporate governance
practices and church productivity, performance and efficiency. Apart from the general
introduction, the paper presents the conceptual and theoretical framework in chapter 2. Chapter 3
highlights the methodological framework which governs the study. Chapter 4 discusses the results
of the study while Chapter 5 deals with concluding remarks.
The Baptist Foundation of Arizona scandal – which produced the largest Non-profit bankruptcy in
American history evoked a similarly rapid and undeferential response from legal authorities. The
foundation had been established in 1948 to raise funds for Southern Baptist-related charities by
selling financial services to coreligionists (Fager, 1999; Baptist Foundation, 2001; Arizona
Attorney General, 2001). It was, in effect, a faith-based mutual fund, managed by laymen overseen
by a governing board composed of prominent Southern Baptists pastors and seminary presidents.
(Rosin, 2001).
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The Foundation generated hundreds of millions of dollars in revenue, most of which was invested
in ventures controlled by its managers – who also richly rewarded themselves with lavish salaries,
loans, and other perks. Over the course of a half century, BFA contributed only $1.3 million to the
church and its charities – though in 1996 it sold more than $500 million worth of securities and
paid its staff more than $16 million in salaries (Baptist Foundation, 2001).
Alerted by disgruntled staffers, the Phoenix New Times initiated a prize-winning series of
investigative reports in 1997. The church defended the Foundation, calling the newspaper “anti-
Christian” and associated its reports with “attacks from Satan” (Fager, 1999). The New Times
stories sparked stockholder suits and attracted the attention of investigators from the state Attorney
General’s office and the Arizona Corporation Commission. In August of 1999, the Commission
ordered the BFA and related enterprises, Arizona Southern Baptist New Church Ventures and
Christian Financial Partners to cease operations. Two months later, BFA and its subsidiaries filed
for bankruptcy – while the Arizona State Board of Accountancy filed a complaint against BFA’s
accountant, Arthur Anderson, LLP (better known for its role in the Enron collapse), which had
given the foundation a clean bill of financial health. In April of 2001, the five top managers of the
BFA were indicted on multiple counts of fraud (Baptist Foundation, 2001).
To add to this, religious leaders in the Catholic Churches across the globe cannot be exempted
from these so-called corporate governance malfeasances, nefarious tendencies and inadequacies
such as sex abuse, unscrupulous embezzlement of church funds among others to detriment of its
teeming saints in the Lord’s vineyard (members) (Investigative Staff of the Boston Globe, 2001).
A lot of research has been conducted on the relevance of corporate governance practices in most
organizational settings in developing countries but the studies on its significant impact on church
growth, productivity and performance appears to be very scanty, specifically in the faith-based
(religious) sector in Ghana (Sarbah & Xiao, 2015; Markkanen, 2015; Ahiabor & Mensah, 2013).
The rationale of this study is the need to find out how bad corporate governance practices within
the religious circles in Ghana affect church growth, efficiency, effectiveness, productivity and
optimum performance, specifically using Holy Spirit Cathedral Church, Adabraka as the case
study religious organization.
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1.3 Aims and Objectives of the Study
The aim of this study is to assess the impact of corporate governance practices on church
productivity and performance from the Ghanaian perspective, specifically using Holy Spirit
Cathedral Church (HSCC), Adabraka as the case study religious organization. The specific
objectives are:
1. To identify the critical challenges confronting corporate governance practices in Ghanaian
churches.
2. To propose models or frameworks to manage the critical challenges confronting corporate
governance practices in Ghanaian churches.
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REVIEW OF LITERATURE
2.1 Introduction
This section focuses on the discussion of key theoretical and empirical developments relating to
impact of corporate governance practices on the productivity of churches in Ghana and beyond.
Unlike the above scholars, Nganga, Jain and Artivor (2003) strengthen corporate governance
beyond the distribution of rights and responsibilities of different stakeholders with vested interest
in corporate organisations to consider the importance of protection of stakeholders, particularly in
relation to how well corporate organizations are managed. The scholars define corporate
governance as the set of mechanisms through which outside investors are protected from
expropriation by insiders (including management, family interests and /or governments (ibid).
In placing corporate governance on a pedestal which reveals the relationship between providers of
finance and corporate organisations, Shleifer and Vishny (1997) are of the opinion that corporate
governance deals with the ways suppliers of finance to corporations assure themselves of getting
a return on their investments. Corporate organisations need to ensure that managers do not
misappropriate the capital or invest in bad projects.
Consequently, corporate governance is seen as “essentially about the prevention of theft”, which
can take place craftily executed by either the management or board or both of them (ICAN, 2009).
7
Okene et al. (2010) as cited in Farar (2005) maintain that corporate governance was used as a term
forty years ago. The root of the term “governance” was from the Latin words “gubarnare” and
“gubernator” which refer to “steering a ship” and to the “steerer or captain of the ship”
respectively. Mensah (2003) states that corporate governance is an institutional arrangement which
provide the discipline and checks over excesses of controlling managers.
Much of the contemporary interest in corporate governance is concerned with mitigation of the
conflicts of interest between stakeholders. Ways of mitigating or preventing these conflicts of
interests include the processes, customs, policies, laws, and institutions which have impact on the
way a company is controlled. Effective corporate governance reduces “control rights” shareholders
and creditors confer on managers, increasing the probability that managers invest in positive net
present value projects (Shleifer & Vishny, 1997).
Thus, the relationships of the board and management, according to Al-Faki (2006), should be
characterized by transparency to shareholders, and fairness to other stakeholders. This will in effect
mitigate the agency costs as predicted by Jensen and Meckling (1976). The implications of the
above definitions are that corporate governance is a system of corporate management and control
to satisfy the strategic goals of all stakeholders while complying with the legal, ethical and other
environmental needs of the society.
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The board, expectedly, will be an assemblage of distinguished individuals from diverse
backgrounds. There is no gainsaying in the fact that effective corporate governance is an enduring
factor which enables an establishment to evolve business excellence. It is capable of enhancing
board competence and teamwork which will result in much improved benefits to the shareholders.
The board has to be structured in such a way that it can achieve three ends which are stated thus:
(a) Proper understanding of, and capability to contend with, the matters of the company;
(b) Effective review and appraisal of the output of management; and
(c) Exercise of incisive and unbiased judgment.
A majority of the directors should have independent status and minds. They should be independent
of management and free of all business and other relationships which could materially interfere
with or be perceived to materially interfere with the exercise of independent judgment. Directors
who are considered as independent by the board should be so acknowledged in the statutory annual
report under the subject-matter of ‘corporate governance’.
The company should state clearly the indexes of moral behaviour which are required of all the
directors and top management and insist that the standards should be obeyed. The company should
publish its standpoint on the issue of employees and board trading in the organization’s stocks and
shares and in associated products which operate to reduce the economic risk of the securities.
The body corporate should have a structure which would independently verify and preserve the
honour of the entity’s financial and economic reporting. There is, therefore, the necessity for a
formidable structure or framework of review and authorization to make sure that there are
truthfulness and accuracy in the company’s financial position furnished. Safeguarding integrity in
financial reporting could be achieved through the agency of the audit committee set up and a
process to bring about the independence and ingenuity of the statutory auditors (Adebayo, Ibrahim
& Yusuf, 2014).
All shareholders should have undiscriminating and timely access to material information which
concerns the company’s operations – financial position, governance, ownership structure and
performance. Information generated and disseminated by the reporting entity should be factual and
presented in unambiguous and standardized formats, in accordance with the legal and institutional
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framework, namely: Statements of Accounting Standards issued by Ghana Accounting Standards
Board, International Accounting Standards issued by the International Accounting Standards
Board, Ghanaian Standards on Auditing issued by the Institute of Chartered Accountants of Ghana
and judicial pronouncements. The shareholder’s rights should be respected and facilitated
effectively. A company ought to empower its shareholders by effectively communicating with
them and making it painless for them to attend general meetings (Adebayo et al. 2014).
2.4.1 Responsibilities
o The board of directors should be in firm control of the affairs of the company in a lawful,
efficient and effective manner, such that the organisation may increasingly improve on its
value creation; and
o The board should, with due regard to the other stakeholders’ interests, ensure that the Value
created is shared among the interested parties such as the shareholders and employees.
2.4.2 Functions
The functions of the board should include, but not limited to, the following:
o Strategic planning;
o Selection, performance appraisal and compensation of senior executive members;
o Succession planning;
o Communicating with the shareholders;
o Ensuring the integrity of financial controls and reports; and
o Ensuring that ethical standards are maintained and that the corporate entity complies with
the laws of Ghana.
The chairman’s primary responsibility is to ensure effective operation of the board and as
much as possible distance himself from the day-to-day running of the company which is
the primary responsibility of the chief executive officer and management team;
The board is the main custodian of the corporation’s accountability; and
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It moderates the conflicting interests of the stakeholders.
o The position of the chairman and chief executive officer should ideally be separated and
held by different persons;
o There should be a strong non-executive independent director as vice chairman of the board,
where the position of the chairman and chief executive officer are combined in one
individual (Adebayo et al., 2014).
A good corporate governance calls for a solid theoretical framework which recognizes and
manages risks. According to Igor Ansoff (1968), a sound and imaginative process of risk oversight
and management and internal control are invaluable for corporate survival, particularly in the face
of global economic and financial crisis. The system calls for the tools of identification, assessment,
monitoring and managing all kinds of risks relating to production, marketing, financing, inflation,
etc.
In the invincible words of Peter Drucker in his book “Managing in Difficult Times,” a dynamic
and forward looking organisation should, at all times and more especially during economic
downturn, “feed the opportunities and starve the problems as they unfold, so as remain comfortably
in business.”
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2.4.4 The Role of Shareholders
The specific roles of shareholders in addition to their rights and privileges are presented as below:
12
the management/directors and shareholders) in place. The members are expected to be conversant
with basic financial statements. The committee has the following objectives:
o Increasing public confidence in the credibility and objectivity of published financial
statements;
o Assisting the directors, especially the non-objective directors, in meeting their
responsibilities of financial reporting;
o Strengthening the independent position of a firm’s external auditors by providing an
additional channel of communication (Adebayo et al. 2014).
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definition is similar to that of the legalistic approach where the board is seen to represent the
interests of the owners of the organisation, however the board role set is confined to selecting and
replacing the chief executive officer, providing advice to and monitoring management and
organisation performance (Zahra & Pearce II, 1989).
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2.5.6 Stakeholder Theory
Stakeholder theory, propounded by Freeman (1984) is premised on the notion that the corporation
should be responsible to a group of wider external stakeholder’s interests rather than merely
shareholders (Cornforth 2003; Dulewicz & Herbert 2004; Letza, Sun & Kirkbride, 2004; Thomsen,
2004). This wider group may include suppliers, staff and customers for instance.
It is worthy of note that, over time as these theories have emerged they have to a greater or lesser
extent enjoyed prominence in the research field. However, none have been able to become the
commonly accepted corporate governance paradigm, thus the quest to find a more accepted
paradigm continues. The next subsection considers some modern interpretations of ‘holistic’
corporate governance theory.
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Kiel (2004, p.442) argued ‘frameworks, models and advice that centre on one element of corporate
governance ignore the complexity of how boards work’.
In trying to capture this complexity, one such ‘holistic’ work by Hilb (2005) proposed an integrated
corporate governance framework that he called New Corporate Governance. That framework
sought to achieve a holistic focus by advocating a multifaceted approach to corporate governance,
integrating four dimensions labelled: situational, strategic direction, integrated board and
management, and controlling dimensions. Another type of ‘holistic’ approach was introduced by
Kiel and Nicholson (2003), who provided a corporate governance charter framework, whereby the
essential elements of corporate governance are characterized and considered in four quadrants:
defining corporate governance roles, improving board processes, key board functions, and
continuing improvement. Yet another framework purporting to be ‘holistic’ was that posited by
Young and Thyil (2008), which ‘embedded the firm specific and micro-internal factors’, such as
leadership, human resource management, legal frameworks and so forth within ‘country-specific
or macro-external factors’, for example, legal systems and social responsibility (Young & Thyil
2008, p.103). In this framework, ‘shareholders and stakeholders are shown to be only one
component of the model with other important aspects’, including, the authors suggest, ‘corporate
governance using multi discipline perspectives’ (Young & Thyil 2008, p.103).
What all these approaches have in common is an attempt to broaden the frame of reference within
which corporate governance should be viewed. Whilst all of these more holistic approaches may
be useful from an analytical perspective, such as using the dimensions as perspectives to analyze
an organization’s corporate governance, the loose relationships between the dimensions renders
the models ineffective in establishing causality. In other words, the models or frameworks are not
able to identify definitively which of the dimensions, when followed by an organisation, lead to
good corporate governance. Given that this thesis is concerned with effective corporate
governance, a theory that provides causality will help to establish efficacy. One way forward was
suggested by Nicholson and Kiel (2005) who argued that there are three major factors that dictate
how a board functions and how it achieves a greater control over corporate governance outcomes.
The authors listed these factors, as follows: (a) Institutional and historical factors, such as the
environment the organisation operates and the resources available to it (b) Each board’s capability
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set, such as the intellectual ability and work ethic of the board and (c) Board level interventions,
such as changing the agenda or reviewing its own performance.
Feedback
Such a view is consistent with that advocated by the Australian Productivity Commission (2010)
in seeking to evaluate the contribution of the not-for-profit sector, and also that proposed by the
United Way of America in its approach to measuring not-for-profit program outputs in the US
(United Way of America 1996). In fact, the former extends the view put forward by the latter by
incorporating the model proposed by the Urban Institute in the United States to extend the process
approach from outputs to contemplate outcomes and impacts. Such an expanded view goes beyond
the organisation to create a societal view and this is depicted in figure 2.2 below. This view seeks
to recognize the effect of an organization’s outputs; to consider the outcomes of the programs; and
how they impact upon society.
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Inputs Process Output Outcomes Impacts
s
Feedback
Implicit in all of these models is the elapsing of time, the models suggest that one phenomena or
action leads to another phenomena or action. However, for not-for profit organizations, in using
such models, it is worth noting that it isn’t about results that are just realized, but often more
importantly when the results are realized. For instance, the provision of drinking water to the
impoverished is pointless if they have all died from thirst due to the lack of timely provision of
drinking water (Australian Productivity Commission (APC), 2010).
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options, being open to advice and input from others as we seek for what is good, acceptable
and perfect;
o Principle of gifts and graces: Paul in his letters to the churches in Corinth and Rome
explains to his readers that we are all different: “the body does not consist of one member
but of many” (1 Corinthians, 12:14) and “We have gifts that differ” (Romans, 12:6). Gifts
are to be used appropriately and we are not called to be something that we are not. There
is a strong notion in the letters of Paul that the body of Christ functions effectively as, and
when, the various gifts are used appropriately. This does not mean that everyone has to be
involved in every decision. As Davis McCaughey points out in his commentary on the
Basis of Union, it is a misunderstanding to think that this teaching about every member
having a gift of the spirit means that in the Church anyone can do anything. It means no
such thing. Paul, and the basis of union, do not say that anyone can do anything, but that
everyone can do something;
o Principle of mutual accountability: Accountability is simply being responsible for our
actions. Individually and collectively we are responsible for our actions and our decisions.
Paul reminds us in his letter to the Romans (Romans, 14:12) that “each of us will be
accountable to God” and in the first letter to the Corinthians (1 Corinthians, 12) that
Christians are all part of the one body and each part belongs to the other. What is more, as
Matthew writes, we hold one another to account (Matthew, 18:15-17).
There is a strong emphasis in the Basis of Union about the notion of the gifts and graces of the
people of God. For example, as cited earlier, “the one Spirit has endowed the members of Christ’s
Church with a diversity of gifts, and that there is no gift without its corresponding service” as well
as “responsibility for government of the Church belongs to the people of God by virtue of the gifts
and tasks which God has laid upon them” and “The Uniting Church therefore so organizes its life
locally, regionally and nationally government will be entrusted to representatives, men and
women, bearing the gifts and graces with which God has endowed them” (Glenn & Thompson,
2011).
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practical application of such guidelines often fails in many faith-based organizations (FBO)
including churches globally (IFAC, 2013).
Moyer (2012) acknowledge that despite the contribution of faith-based developmental work,
obstacles, and challenges still exist both from within the faith and from broader society.
Traditionally, the management of churches has relied on informal processes based on shared norms
and values of delivering humanitarian services, rather than on formalized procedures. The
commitment of workers, volunteers and other organizational members has tended to be facilitated
through strong reliance on a shared belief in the purpose of the organization, and not primarily
through control system and remuneration based on profit making. However, the government is still
considered the appropriate partner that can introduce regulatory framework that can help churches
build capacity to manage themselves soundly (Salim, 2013).
Consequently, the adoption of more formal controls and businesslike management practices are
often a source of conflict to the members of the organization and weakening of their strong self-
driven commitment, which is key to the success of the church’s goals and delivery of the much
needed service to the community.
Bongani (2013) report that establishing internal control systems in organizations is critical to
ensure the reliability of accounting records, because internal control systems can constrain
management or staff`s reported and possible random errors. This ensures the authenticity of the
content of financial reporting to provide reasonable assurance to stakeholders and it becomes
another important system arrangement to ensure reliable financial reporting.
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Petrovits et al. (2009) affirms that internal control systems are not new to the religious sector
including churches. Most organizations that receive external funding are subjected to rigorous
internal control in line with the donor agency requirements. Churches which exhibit internal
control deficiencies may risk losing the much needed funding from the donors as they are
accountable to them as well as the beneficiaries, the employees and other stakeholders.
However, due to the inherent limitations of internal controls and pressure, opportunity and excuses
by management and perhaps the credibility of controls, discussing and benchmarking is still not
high enough within religious entities in Ghana. Though cases of fraud and other malpractices are
rarely publicized by media and other communication channels, it is probable that misuse of funds
due to lack of financial control systems is a reality in most churches Experience reveals that the
financial management processes of churches in Ghana are generally weak and dominated by
conditions of resource scarcity vis-à-vis the ever increasing agenda of social development
activities on which such funds could be spent. Sustainable funding has helped many churches in
Ghana implement diverse programmatic interventions which has not only benefited the
communities but has also improved the standard of living. However tough economic times buoyed
by global recession have in one way or another affected global funding. Consequently many
churches cease project operations by the day due to lack of sustainable funding.
Unlike their counterparts in the profit-making, whose accounting system reflects the results of
economic activities, expressing the efficiency with which the objective has been achieved;
churches are mostly concerned with raising and expanding resources according to specific budget
plans.
For many churches across the globe including Ghana, it is difficult to make the transition from
values-based, informal management practices to an approach that emphasizes the financial
implications of decisions. Churches have traditionally been reluctant to import practices from the
business sector. Chenhall, Hall and Smith (2010) added that an additional challenge concerns the
potential impact of more formal management controls on the ability of organizations to develop
social capital. Little is known about how formal controls affect the way churches develop and
employ social capital, and how this influences their ability to deliver welfare services with
increased pressure to be more financially efficient.
22
Another dilemma facing churches in developing economies such as Ghana is that financial control
system is often tied up with funds received from a particular donor. Therefore it is tailor-made to
suit particular financial transactions and may not be applicable to other funds received by the
church. With limited resources to have appropriate human resource, financial control systems
therefore, become applicable on fund-to-fund basis or rather seasonal and not necessarily
incorporated in the overall church organizational management system.
Petrovits et al. (2009) argues that religious entities do not issue shares and their missions are not
to maximize profit and therefore not accountable to shareholders. But they are accountable to
donors who provide an important source of capital. It is a fact that churches in Ghana do not have
limitless resources and therefore, compete for contributions. Prior research suggests that church
managers, pastors and the like, are rewarded for higher mission related spending and if such church
organizations have an internal control problem, donors could easily choose to contribute to another
organization where the capital presumably will be more efficiently used.
Christianity spread throughout the early Roman Empire, despite persecutions due to conflicts with
the pagan state religion. In 313, the struggles of the Early Church were lessened by the legalisation
of Christianity by the Emperor Constantine I. In 380, under Emperor Theodosius I, Christianity
became the state religion of the Roman Empire by the decree of the Emperor, which would persist
until the fall of the Western Empire, and later, with the Eastern Roman Empire, until the Fall of
Constantinople. During this time (the period of the Seven Ecumenical Councils) there were
23
considered five primary sees (jurisdictions within the Catholic Church) according to Eusebius:
Rome, Constantinople, Antioch, Jerusalem and Alexandria, known as the Pentarchy (Hitchcock,
2004).
After the destruction of the western Roman Empire, the church in the West was a major factor in
the preservation of classical civilization, establishing monasteries, and sending missionaries to
convert the peoples of northern Europe, as far as Ireland in the north. In the East, the Byzantine
Empire preserved Orthodoxy, well after the massive invasions of Islam in the mid-7th century.
The invasions of Islam devastated three of the five Patriarchal sees, capturing Jerusalem first, then
Alexandria, and then finally in the mid-8th century, Antioch (Norman, 2007; Hitchcock, 2004).
The whole period of the next five centuries was dominated by the struggle between Christianity
and Islam throughout the Mediterranean Basin. The battles of Poitiers, and Toulouse preserved the
Catholic west, even though Rome itself was ravaged in 850, and Constantinople besieged. In the
11th century, already strained relations between the primarily Greek church in the East, and the
Latin church in the West, developed into the East-West Schism, partially due to conflicts over
Papal Authority. The fourth crusade, and the sacking of Constantinople by renegade crusaders
proved the final breach. In the 16th century, in response to the Protestant Reformation, the Church
engaged in a process of substantial reform and renewal known as the Counter-Reformation. In
subsequent centuries, Catholicism spread widely across the world despite experiencing a reduction
in its hold on European populations due to the growth of Protestantism and also because of
religious skepticism during and after the Enlightenment. The Second Vatican Council in the 1960s
introduced the most significant changes to Catholic practices since the Council of Trent three
centuries before (Norman, 2007).
In the account of the Confession of Peter found in the Gospel of Matthew, Christ designates Peter
as the "rock" upon which Christ's church will be built (Erhman, 2006). While some scholars do
state Peter was the first Bishop of Rome, (George, 1913) others say that the institution of the
papacy is not dependent on the idea that Peter was Bishop of Rome or even on his ever having
been in Rome. Many scholars hold that a church structure of plural presbyters/bishops persisted in
Rome until the mid-2nd century, when the structure of a single bishop and plural presbyters was
adopted, and that later writers retrospectively applied the term "bishop of Rome" to the most
prominent members of the clergy in the earlier period and also to Peter himself (Brown, 2003). On
this basis, Oscar Cullmann (1962) and Henry Chadwick (1993) question whether there was a
formal link between Peter and the modern papacy, and Raymond E. Brown says that, while it is
anachronistic to speak of Peter in terms of local bishop of Rome, Christians of that period would
have looked on Peter as having "roles that would contribute in an essential way to the development
of the role of the papacy in the subsequent church". These roles, Brown says, "contributed
enormously to seeing the bishop of Rome, the bishop of the city where Peter died, and where Paul
witnessed to the truth of Christ, as the successor of Peter in care for the church universal" (Brown,
2003).
25
catechists. Cardinal Peter Turkson, formerly Archbishop of Cape Coast, Ghana, is Africa's
youngest cardinal at 64 years old (Donadio, 2009; Barrett, 2009).
2.10.2.1 History
Many important members of the early Church were from Africa, including Mark the Evangelist,
Origen, Tertullian, Saint Augustine of Hippo (from Hippo Regius in what is now Annaba, Algeria
(WDL, 2013) and Clement of Alexandria. Churches in eastern North Africa, such as those in Egypt
and Ethiopia, tended to align with the practice of the Eastern Church, but those to the West (the
area now known as the Maghreb) were connected to the Roman Church. Three early popes were
from the Roman Africa Province. These were Pope Victor I (reigned c . 189 to 199), Pope Miltiades
(reigned 311 to 314) and Pope Gelasius I (492 to 496) and all of them were Christian Berbers.
Church membership rose from 2 million in 1900 to 140 million in 2000 (Zenith News Agency,
2011).
According to Philip Jenkins, the 20th century saw major changes for the Catholic Church. In 1920
Hilaire Belloc had proclaimed, "The Church is Europe, and Europe is the Church." By 1960, the
College of Cardinals had its first African, Laurean Rugambwa. By deliberate policy, John Paul II
selected many cardinals from Third World nations, and by 2001 they made up over 40 percent of
the body (Jenkins, 2002). In 2002, Italian cardinals made up just 15 percent of the College, a drop
from 60 percent in the 1950s (Johnston, 2002).
26
Ecclesiastical Province of Cape Coast
(a) Archdiocese of Cape Coast (b) Diocese of Sekondi-Takoradi (c) Diocese of Wiawso
Furthermore, the Roman Catholic Archdiocese of Accra covers the Greater Accra Region and parts
of the Volta region. There are 62 parishes and rectories. The Roman Catholic Archdiocese of Accra
(Latin: Accraën(sis)) is the Metropolitan See for the ecclesiastical province of Accra in Ghana
which includes the suffragan dioceses of Ho, Koforidua, Jasikan and Keta-Akatsi. The Latin title
of the archdiocese is Archidioecesis Accraënsis, and the corporate title is Archdiocese of Accra.
The cathedral parish for the archdiocese is the Holy Spirit Cathedral. Most Reverend Dominic
Kodwo Andoh† was the first Ghanaian native to become Archbishop of Accra. Installed in October
1971, he became the 3rd Ordinary for Accra since its establishment as a diocese.
The Metropolitan Archdiocese has four suffragans. In 1992, the Roman Catholic Diocese of
Koforidua was carved out of Accra by His Holiness, St. John Paul II. Accra was elevated to a
Metropolitan See and Bishop Andoh was made the Metropolitan Archbishop. While the Ho,
Jasikan and Keta-Akatsi Dioceses cover the Volta Region of Ghana, Koforidua Diocese spans a
vast area of the Eastern Region.
There are six deaneries in the Archdiocese of Accra. Originally termed as Vicariates or Districts
in the Code of Canon Law, deaneries exist "to foster pastoral care through common action". Each
Deanery is headed by a Dean whose duty of promotion and coordination chiefly pertains to his
responsibility to oversee and assist in uniting the other presbyters or priests in his vicariate in a
common pastoral activity. The six deaneries of Accra namely: (a) Kaneshie Deanery (b) Mamprobi
27
Deanery (c) Kpehe Deanery (d) Osu Deanery (e) Madina Deanery (f) Tema- Battor Deanery
(Catholic Church in Ghana, 2012).
It is a registered religious entity, with the mother church in Italy, Rome (headquarters), being its
real owners. The governance structure is made up of (1) Bishop – Pope (Patriarchs, Major Bishops,
Cardinals, Primates, Metropolitans, Archbishops, Diocesans Bishops, Other Bishops) (2)
Ordinaries and Local Ordinaries (3) Presbyterate consisting of (i) In General (ii) Priests in service
outside their diocese (iii) Positions within a diocese level (iv) Vicars Forane or Deans (v) Parish
priest/pastor (vi) Assistant priests/parochial vicars (vii) Honorary titles (4) Diaconate (5) Laity (6)
Religious.
The typical role of a bishop in the Catholic Church is to provide pastoral governance for a diocese.
Bishops who fulfill this function are known as diocesan ordinaries, because they have what canon
law calls ordinary (i.e. not delegated) authority for a diocese. Other bishops may be appointed to
assist ordinaries (auxiliary bishops and coadjutor bishops) or to carry out a function in a broader
field of service to the Church, such as appointments.
Powers at Holy Spirit Cathedral Church are distributed by the General Assembly which is made
up of (a) Bishop (b) Ordinaries and Local Ordinaries (c) Presbyterate (d) Diaconate (e) Laity (f)
Religious and also termed as the “Implementing Body of the Church”.
Bishops of the Catholic diocese may form an episcopal conference and meet periodically to discuss
current problems. Decisions in certain fields, notably liturgy, fall within the exclusive competence
28
of these conferences. The decisions of the conferences are binding on the individual bishops only
if agreed to by at least two-thirds of the membership and confirmed by the General Assembly.
The Pope, as the successor of Saint Peter, is the head of the universal Catholic Church. Some of
the Catholic churches are headed by a patriarch, a major archbishop, or a metropolitan. Within the
Catholic Church too, dioceses located within one country, or a portion thereof, are normally
grouped together as ecclesiastical provinces, in which the bishop of a particular see has the title of
metropolitan archbishop, with some very limited authority for the other dioceses, which are known
as suffragan sees (Catholic Church in Ghana, 2012).
29
RESEARCH METHODOLOGY
3.0 Introduction
This chapter elucidates the methodology used for the study. The main issues discussed here are
the research approach, research design, research population, sample and sampling technique,
source of data and data collection methods, and method of data analysis.
30
church members (clergy) and heads of departments. The interviews were conducted because; it is
an important source of gathering data for case studies. The kind of interview used was what is
called by Merriam (1998), semi-structured interview. Because of the presence of pitfalls in the use
of interviews by way of response bias and reflexivity Yin (1994), though questions are
predetermined, the questions for the interview were not asked in any specific order. The interview
was designed to allow respondents bring up other issues they felt were of interest to the subject
matter. This created the needed friendly and cordial atmosphere which enabled researcher to ask
follow-up questions freely. The questionnaires were pre-tested on a smaller size of the sampled
respondents for the research. This was to ensure that the questionnaires designed solicited the
appropriate responses from the respondents to answer the research question for the achievement
of research stated objectives. The use of closed end as well as opened ended questions allowed
the researcher to make easy categorization and analysis.
31
Reliability of a research is important for its generalizability (writing.colostate.edu). To ensure
reliability, the procedures followed in the case study were documented. This approach enabled the
researcher to apply the same procedures in performing the same case study to obtain similar
findings and conclusions. Triangulation strategies were adopted to ensure that the data obtained
was reliable and valid. In this study, triangulation took the form of cross-checking reported
information using one method, with information found from alternative sources (Flick, 2014;
Grbich (2013).
32
RESULTS AND DISCUSSION
4.1 Introduction
As indicated earlier, the thrust of this study is to assess the impact of corporate governance
practices on the productivity of churches in Ghana with special emphasis on Holy Spirit Cathedral
Church (HSCC), Adabraka. To do this, the study collected data from church members and staff of
HSCC to answer the following research questions:
1. What are the critical challenges confronting corporate governance practices in Ghanaian
churches?
2. What are the models or frameworks for managing the critical challenges confronting
corporate governance practices in Ghanaian churches?
Table 4.1 above clearly depicts that out of the 40 respondents working at all the 11 departmental
units at HSCC, 25 representing 62.5% were males and 15 which represented 37.5% were females.
33
Table 4.2 Ages of Respondents
Table 4.2 presents the ages of respondents’ at HSCC.
Age Ranges (Years) Frequency Percentage (%)
25-29 3 7.5
30-34 12 30.0
35-39 18 45.0
40-44 6 15.0
Above 45 1 2.5
Total 40 100.0
Source: Author’s Field Survey Report, 2016
Table 4.2 depicts that the age bracket within the ranges of 30-34 and 35-39 recorded maximum
respondents’ frequencies of 12 and 18 with their percentage marks of 30.0% and 45.0%
respectively. Also, respondents within the age bracket of 40 to 44 had a frequency of 6 with an
accompanying percentage score of 15.0%. It was closely followed by participants with the age
range of 25-29 with an occurrence number and a percentage scoring of 3 and 7.5% respectively.
However, those above 45 years were the last in the pecking order as far as the respondents’ age
bracket is concerned. The category recorded a frequency of 1 as well as a percentage mark of 2.5%
accordingly.
With reference to table 4.3 above, out of the 40 respondents that took part in the survey at HSCC,
only 11 employees representing 27.5% were made of bachelors and spinsters while the remaining
larger part representing the married category amounted to 29 and recording a percentage figure of
72.5%. This, to all intents and purposes suggest that a greater part of the workforce can be termed
34
as responsible individuals which will ultimately augment HSCC’s optimum efficiency,
effectiveness, performance, productivity, profitability and the like
With respect to table 4.4, respondents who have been in active service for HSCC for the past 6 to
10 years recorded a total frequency of 21 representing approximately 52.5%. This was closely
followed by respondents’ who have been working with the organization spanning between 1 to 5
years. The category recorded a percentage mark and a frequency of 27.5% and 11 respectively.
Furthermore, HSCC respondents’ who fell within the service length range of 11 to 15 years also
attracted a frequency of 6 as well as a percentage score of 15.0%. However, respondents’ within
the service length exceeding 16 years coincidentally recorded an extremely woeful percentage
score of 5.0% and an accompanying frequency of 2.
35
Source: Author’s Field Survey Report, 2016
In relation to table 4.5 above, it can be inferred that 27.5% of respondents have Diploma/HND
qualification with a frequency of 11, 47.5% were first degree holders and subsequently had a
frequency rate of 19, 5.0% were master’s degree holders with an accompanying occurrence
number of 2. It is interesting to note that 15.0% of the respondents with a frequency rate of 6 at
HSCC, represented various professional qualifications (Other) when the survey was carried out.
However, the category of respondents’ with a percentage score of 10.0% as well as a frequency of
4 were those who had successfully passed the SSCE/WASSCE examinations.
36
5 Financial control system is often tied up 2 5.0 5th
with church project’s funds received from
a particular donor (agency) (FCSA)
Source: Author’s Field Survey Report, 2016
With reference to table 4.6 above and figure 4.1 below, it can be inferred that participants at Holy
Spirit Cathedral Church (HSCC) selected “Inability to develop social capital”, designated with the
acronym “IDSC” as the 1st critical challenge confronting corporate governance (CG) practices in
Ghanaian churches as depicted by its optimum frequency rate and percentage scoring (PS) of 16
and 40.0% respectively. The construct was edgily followed by “Weak regulatory framework
(WERF)”, “Non – stringent financial management processes (NSMP)” including “Over – reliance
on informal processes based on shared norms and values of delivering humanitarian services rather
than on formalized procedures (OVER)” with accompanying respective frequencies of 11, 7 and
4 and were subsequently rated 2nd, 3rd and 4th in the pecking order. It recorded percentage scorings
(PS) of 27.5%, 17.5% and 10.0% (see table 4.6 above and figure 4.1 cited below).
40
35
30
25
20
15
10
0
IDSC WERF NSMP OVER FCSA
PS
37
Nevertheless, “Financial control system is often tied up with church project’s funds received from
a particular donor (agency) (FCSA) was ranked as the least (5th) key challenge militating against
effective corporate governance practices in churches within the precincts of Ghana. FCSA had a
frequency and percentage scoring (PS) of 2 and 5.0% respectively. It is worthy of note that the
participants findings agrees with the publications of ethical-minded personalities such as Petrovits,
Shakespeare and Shih (2009), Chenhall, Hall and Smith (2010), Moyer (2012). To buttress this
agreeableness, the comprehensive research projects executed by Salim (2013) and Bongani (2013)
in addition to what was publicized in IFAC (2013) shares some semblance with the participants’
revelations during the study.
38
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
5.1 Overview
This chapter brings the study is to a close by, first, summarizing all the major themes addressed
from chapters one through to chapter four. Then, on the basis of the empirical findings highlighted
under chapter four, and consistent with the existing literature, relevant conclusions are drawn. In
the final part of this chapter, recommendations for managers and future researchers alike are
suggested.
5.2 Summary
Ethical compliance managers spend considerable amount of time planning and managing corporate
governance (CG) practices geared towards enhancing organizational productivity at any given
stipulated time period. For them, it is critical to be aware that the domain of CG practices within
the twenty-first century is absolutely distinct from that in the Porter’s era. Typically, the structure
of the faith-based organizations like churches have become more sophisticated and dynamic.
Hence, the stringent inculcation of state-of-the-art CG practices can inadvertently help myriads of
religious entity’s to enhance their congregants morale, motivation, self-actualization, demystify
certain perceptual and attribution biases toward the clergy among others. These, according to the
researchers’ estimation, will invariably culminate into improved church’s effectiveness, efficiency
and optimum productivity in the foreseeable future.
As regards the critical challenges confronting CG practices at HSCC, 5 parameters were opted for
by the respondents based on their percentage scorings (PS) as depicted in table 4.6 and figure 4.1,
namely: Inability to develop social capital (IDSC (PS=40.0%); Weak regulatory framework
(WERF) (PS=27.5%); Non – stringent financial management processes (NSMP) (PS=17.5%);
Over – reliance on informal processes based on shared norms and values of delivering
humanitarian services rather than on formalized procedures (OVER) (PS=10.0%) as well as
Financial control system is often tied up with church’s project’s funds received from a particular
donor (agency) (FCSA) (PS=5.0%).
39
5.3 Conclusions
With reference to the upshot part of the study, it can be asserted that all the 40 participants at HSCC
suggested “Inability to develop social capital” as the most critical challenge confronting CG
practices, recording a PS of 40.0%. It was closely followed by “Weak regulatory framework”,
“Non – stringent financial management processes”, “Over – reliance on informal processes based
on shared norms and values of delivering humanitarian services rather than on formalized
procedures and lastly “Financial control system is often tied up with church’s project’s funds
received from a particular donor (agency)” with their respective PSs of 27.5%; 17.5%; 10.0% and
5.0% accordingly.
5.4 Recommendations
The following remedies will help manage to a varying degree, the issues that came to the fore in
the study:
o Facilitating shareholder director nominations;
o Proxy enhancements and risk disclosures;
o Elimination of broker voting in uncontested church director elections, rating disclosures;
o Prohibition on pay-to-play practices which includes an advisor’s direct or indirect
solicitation of third parties contribution;
o A more assertive style of supervision at the clergy level;
o The Church Financial Services Oversight Council should endeavor to address issues such
as weak regulations, arbitrage through the closing of regulatory groups, and the application
of appropriate supervisory standards to currently unregulated faith-based organizations;
o Re-working compensation practices to disincentives excessive risk-taking;
o Improving coordination and cooperation among regulatory agencies through robust sharing
of information;
o Aggressive enforcement of the Sarbanes-Oxley “claw-back” provision;
o Elimination of classified boards;
o Enhanced disclosures of corporate church leadership structure (board composition,
directors’ skills and experience, etc.);
o Mandatory board-level risk committee;
o Enhanced disclosures on risk management;
40
o Enhanced proxy disclosure related to implications of compensation for risk-taking
incentives;
o Stringent reliance on Agency, Legalistic Perspective, Stewardship, Resource Dependency,
Democratic Perspective, Stakeholder, Managerial Hegemony, Institutional, Holistic CG,
ERG, Herzberg’s 2 Factor, Mc Gregor X and Y, Adam Stacy’s Equity, Latham and Locke
Goal Setting, Mc Clelland’s Need Hierarchy, Maslow Hierarchy of Human Needs theories
and the like will invariably help alleviate and if possible, manage the pitfalls encompassing
effective CG practices in Ghana and the world at large.
41
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APPENDICES
APPENDIX 1 –TABLES
49
APPENDIX 2 – QUESTIONNAIRE
I am an MBA (Finance) student of the Central University College (CUC), Accra and researching
on the above-mentioned topic. You are please kindly requested to participate by providing
information to help identify the critical challenges confronting corporate governance practices in
the teeming churches in Ghana, specifically using Holy Spirit Cathedral Church, Adabraka. Please
kindly don’t write your name on this questionnaire. THANK YOU.
SECTION A
Demographics
50
5. How long have you worked with this organization?
(a) 1-5 Years ( ) (b) 6-10 Years ( )
(c) 11-15 Years ( ) (d) 16 years and above ( )
6. What is your current position in the church? ________________________________________
______________________________________________________________________________
SECTION B
Questions on Corporate Governance Practices
Questions on Roles and Powers Definition
1. Are the roles of the church minister, board and general overseer clearly defined? (i) Yes ( ) (ii)
No ( )
2. Is the role of the church board documented in a board charter? (i) Yes ( ) (ii) No ( )
5. Has management understood and accepted the responsibility for internal control?
(i) Yes ( ) (ii) No ( )
6. Is there a framework of strategic control that includes formal procedural and financial
delegations to govern the conduct of the church organisations business? (i) Yes ( ) (ii) No ( )
7. Does the framework of strategic control include a formal schedule of those matters specifically
reserved for decision by the church board? (i) Yes ( ) (ii) No ( )
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9. Is the basis for church board appointments clearly stated? (i) Yes ( ) (ii) No ( )
10. Are church directors subject to regular re-nomination, say every three years? (i) Yes ( ) (ii)
No ( )
11. Are Board appointments made on the basis of the skill requirements of the Board?
(i) Yes ( ) (ii) No ( )
14. Are there appropriate arrangements to ensure that the church board has access to all relevant
information, to high quality advice and to the resources necessary to enable it to carry out its
functions efficiently and effectively? (i) Yes ( ) (ii) No ( )
15. Are there written procedures to address the process required where a Board member has a
conflict of interest? (i) Yes ( ) (ii) No ( )
17. Has the church board developed a formal code of conduct defining the standards of personal
behaviour to which the members of the church board and all employees of the organisation are
required to adhere?
(i) Yes ( ) (ii) No ( )
18. Does the church board and senior management lead by example in relation to the code of
conduct?
(i) Yes ( ) (ii) No ( )
19. Is adherence to the code of conduct regularly reviewed and is intermediate action taken where
necessary? (i) Yes ( ) (ii) No ( )
20. Are there appropriate mechanisms to ensure that staff are not influenced by prejudice, bias or
conflicts of interest? (i) Yes ( ) (ii) No ( )
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Questions Relating to Strategy Setting
21. Are annual measurable objectives set out in an annual plan approved by the church board?
(i) Yes ( ) (ii) No ( )
22. Is an annual budget prepared by management and approved (or rejected) by the church board?
(i) Yes ( ) (ii) No ( )
24. Has the church board decided what performance reports to see, and how frequently?
(i) Yes ( ) (ii) No ( )
25. Are the users of the reports satisfied with the amount and quality of the information provided?
(i) Yes ( ) (ii) No ( )
26. Is there a senior church executive responsible for ensuring that appropriate advice is given on
all financial matters including fraud and risk management? (i) Yes ( ) (ii) No ( )
27. Is there a senior church executive responsible for ensuring effective management, co-
ordination and delivery of information (including related technology)? (i) Yes ( ) (ii) No ( )
28. Is the financial information reported prepared on an accrual basis? (i) Yes ( ) (ii) No ( )
29. Does the financial information report year to date actual and budget, full year budget and full
year forecast on an accrual basis? (i) Yes ( ) (ii) No ( )
30. Is the church board regularly briefed on the financial situation of the organisation by the
management team? (i) Yes ( ) (ii) No ( )
31. Does church board reporting include the status of significant initiatives determined by the
Board and/or management? (i) Yes ( ) (ii) No ( )
53
Semi – Structured Questions
34. How many church organisations have you been associated with? (i) 1-5 ( ) (ii) 6-10 ( )
(iii) 11-15 ( ) (iv) 16-20 ( ) (v) Above 21 ( )
35. How many years have you served on / been involved with church boards of directors?
(i) 1-5 years ( ) (ii) 6-10 years ( ) (iii) 11-15 years ( ) (iv) 16-20 years ( ) (v) Above 21years ( )
36. What other experience or qualifications have you gained that is relevant to church’s corporate
governance?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
38. Can you recount your experience with performance evaluation of the church board?
(i) Yes ( ) (ii) No ( )
39. What do you think are the traps to avoid in carrying performance evaluation of individual
church board members or the church board generally?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
40. What are the reasons for not carrying out church board performance appraisal or individual
board member performance appraisal?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
41. What factors come into play in church or individual board member performance evaluation?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Performance metrics
42. Do you know of any church board which has established performance metrics for its own
corporate governance activities? (i) Yes ( ) (ii) No ( )
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(a) If “Yes”, can you please kindly tell me about it?
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
(b) Are you able identify them (the board)? (i) Yes ( ) (ii) No ( )
(c) Are you able to detail the actual measures or the themes they sought to measure? (i) Yes ( )
(ii) No ( )
43. Do you see any merit in establishing performance metrics? (i) Yes (ii) No
44. What is the likelihood that church boards may use performance metrics in the future?
_____________________________________________________________________________
_____________________________________________________________________________
55
(b) Over-reliance on informal processes based on shared norms and values of delivering
humanitarian services rather than on formalized procedures ( )
(c) Non-stringent financial management processes ( )
(d) Inability to develop social capital ( )
(e) Financial control system is often tied up with church project’s funds received from a particular
donor ( )
46. Propose critical models or frameworks to manage the issues spelt out in question 45.
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
56