Corporate governance studies in Zimbabwe have concentrated on existence of frameworks that control firms. This study focused on the corporate governance factors that are associated with firm performance in the Zimbabwean manufacturing sector. We investigated a sample of 88 companies which were operating at least 80% capacity from 2009 to 2012.Using Return on Assetst (ROA) as a measure of performance and the dependent variable, and 14 corporate governance proxies encompassing board structure, board composition and board procedures as the independent variables, a bivariate and multivariate regression analysis was performed. The results indicated that shareholder concentration, proportion of independent directors, board tenure and access to financial statements are positive and significant to firm performance in the bivariate analysis. On the multivariate regression analysis however, independent directors was positive but not significant. Researchers have not been able to agree on these factors and since corporate governance is largely endogenously determined it can be concluded that factors are influenced by country effects. Thus further studies focusing on similar countries need to be undertaken.
Social capital research has largely focused on developed economies and there is conflict of acceptance on the legality of some network relations across cultures. This study pioneered the interventions at firm level aimed at building social capital for company performance in the Zimbabwean manufacturing sector. This was in an effort to provide evidence of the need for network relations to enhance business performance. A survey method was used to collect data to confirm empirically the social capital interventions existing in the sector. Using an econometric model, 10 social capital variables were regressed to determine importance of the interventions. The bivariate results indicated that networks, level of trust and entertainment were significantly associated to firm performance. On the multivariate level, trust, presences of an entertainment budget and government liaison were positively associated with firm performance. It was concluded that investment in social capital through entertainment budget created profitable relationships which if nurtured builds trust which reduces transaction costs thus affecting the bottom line. So social variables which were significantly associated with performance worked in a symbiotic, cyclical nature.
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