An Investigation into the Effect of Board Members’ Remuneration on the Performance of Public Enterprises in Namibia

Abstract

The study focused on the effects of the board members’ remuneration on the performance of public enterprises in Namibia. The main objective of this study was to investigate the inter relationship between board members’ remuneration and the performance of the public enterprises in Namibia. The study used quantitative methods as a research strategy. The research study used secondary data from the Ministry of public enterprises database and primary data was gathered through structured questionnaires that were distributed to different public enterprises’ Chief executive officers in Namibia. The study focused on board members’ remuneration as representatives of the board members for each of the 97 state-owned enterprises in Namibia. The researcher used Excel to do the regression analysis. The researcher tested for correlation between a firm’s performance and annual salary and sitting allowance and miscellaneous allowance. Public enterprises are divided into four tiers. The researcher made use of the average revenue for each tier to represent the firm’s performance. A total of 75% of the respondents do not agree that there is a relationship between the board members’ remuneration and the firms’ performance, and 17% agree that there is a relationship between the board members’ remuneration and the firms’ performance. The study recommended that the MPE/Pes should implement motivational strategies to improve board members’ performance hence improving the firm’s performance.