Rethinking Corporate Governance in Ethiopia

12 Pages Posted: 8 Sep 2008

See all articles by Minga Negash

Minga Negash

Metropolitan State University of Denver; University of the Witwatersrand

Date Written: September 7, 2008


This paper deals with the corporate governance thematic area of the African Peer Review Mechanism (APRM). Its contribution to the literature is twofold: (1) It provides additional evidence that a microeconomic perspective of studying governance leads to a better understanding of key reform issues in many Sub Sahara African (SSA) economies; and (2) With regard to Ethiopia, the paper surmises that the overall standard of corporate governance is disappointing. More specifically, the legal and constitutional instruments do not provide adequate legislative; key international conventions and standards are not ratified; political parties own substantial number of business enterprises and operate in key sectors of the economy; ownership concentration through pyramid structure introduces particular problems of agency and creates crony capitalism; investor and creditor protection laws are inadequate; the absence of organized equity market is a serious void, and finally with regard to professional education, the increase in the number of tertiary institutions granting degrees and diplomas is not matched by sound quality standards. The reform debate will have to find solutions to these problems.

Keywords: Corporate governance, African Peer Review Mechanism, Ethiopia

JEL Classification: K12, K22, L22, M14, M41, N27

Suggested Citation

Negash, Minga, Rethinking Corporate Governance in Ethiopia (September 7, 2008). Available at SSRN: or

Minga Negash (Contact Author)

Metropolitan State University of Denver ( email )

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University of the Witwatersrand

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South Africa

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