Companies in Cameroon that depend entirely on state subsidies and those in which the state is a shareholder are now expected to perform better following three presidential decrees signed Wednesday, June 19, 2019 by the Head of State Paul Biya. The three decrees relating to the general statutes of state enterprises and corporation in Cameroon come at a time when the state is trying to cut down on its expenses.

Among other key issues addressed in the decrees, are the remuneration and other financial benefits of the top managers of state-run companies in the country will be based on their company’s turnover for a three-year period.

Decree N°2019/321 and Decree N°2019/322 of June 19, 2019 fix the categories of public establishments, remuneration, indemnities and benefits for its management team while Decree N°2019/320 of June 19, 2019 specifies the modalities for the application of certain dispositions of Law no. 2017/010 and 2017/011 of 12 July 2017 relating to the general statute of public establishments and enterprises.

Furthermore, the decrees have brought out clarity on the functioning and running of state-owned companies in the country. The roles of Presidents of the Board of Directors and General Managers have been clearly spelled out.

The decisions of the Board of Directors are in the form of resolutions and the president co-signs with one of the members of the board.

The recruitment of personnel must respond to specific needs of the corporation as expressed by the general manager and that in a bid to ensure flexibility and performance, the general manager is the one authorised to give out contracts in a state-owned corporation.

The general manager or the deputy general manager who is appointed as a member of government automatically loses his position as general manager or deputy general manager.

Even though the running of state enterprises and corporation is under the control of the board of directors, they are managed by the general manager, but the general manager must seek the authorisation of the board of directors in case of problems in the institution.

The specific roles of the Board of Directors and those of the top managerial team have been clearly defined. The legal instruments have also stated clearly that no one will henceforth sit on the board of directors of a state-run company upon retirement or following the expiry of his or her term.

As far as remuneration and other financial benefits are concerned, these will be based on the production of the companies for a period of three years. The decrees classify the state enterprises and corporations into five categories ranging from 100 billion FCFA as highest turnover to Five billion FCFA for the lowest. The said classification will be carried out every three years by an order of the minister of finance between July 1 and August 31.

The innovations also concern mission allowance within the country and abroad which are now at a flat rate. In a bid to check excesses, it will no longer be a question of members of the board of directors fixing the amounts.

The stage has thus been set for improved management and governance of state-owned corporations and enterprises.