Author(s): Tankiso Moloi, Michael Adelowotan
The motivation for the development of corporate governance codes in South Africa was to ensure that companies and other organisations are managed so as to ensure ethical leadership, accountability, transparency and sustainability of these organisations. However, observers of the South African Corporate environment noted that the development of King I code of corporate governance was particularly focused on corporate bodies and not to other organisations. In order to address this imbalance and considering the significant role of these educational institutions to the development of the nation’s economy, the subsequent King codes were designed in a manner that permitted them to apply to any organisation regardless of manner or form of incorporation. The Heher Commission of Inquiry that investigated the process of administration in the Higher Education Sector observed that there are so many challenges (ranging from leadership and administration; funding and accountability; infrastructure and equipment) confronting TVET colleges, which is an indication that governance in general is a challenge in this environment. Through the document analysis methodology, this work explored the nature of corporate governance principles and practices disclosed in South Africa’s Technical, Vocational, Educational, and Training colleges’ annual reports so as to determine whether the challenges could also be attributable to the lack of application of principles thereby filling gap in many studies focusing on the application of King code to companies alone. We hypothesize that the application of King codes will lead to improved performance by TVET colleges. Our research question is “To what extent will the application of King codes resolve the challenges facing TVET colleges in South Africa?” Our findings suggest that the majority of the observed institutions had not disclosed the key corporate governance practices in their annual reports. It could then be argued that the challenges that are plaguing these institutions as highlighted by the Heher Commission of Inquiry could also be attributable to the lack of application of principles, leading to the unstable leadership and administration; lack of funding and accountability; decaying infrastructure and equipment, which ultimately renders these organisations incapable of delivering on its core mandate.