Five core values underpin OTR’s stewardship of government investments

TANZANIA: MANAGING government investments worth 92.28tri/- is a responsibility that goes well beyond keeping records of public ownership.

It means ensuring that hundreds of institutions and companies are properly managed, that public resources are protected and that investments deliver returns that justify the confidence placed in them.

That is the task facing the Office of the Treasury Registrar (OTR), which oversees 308 institutions and companies across the country and beyond.

Of these, 252 are public sector corporations in which the government holds majority shares, while the remaining 56 are companies in which it has minority interests.

The scale of this portfolio makes the quality of oversight, investment decisions and corporate governance particularly important.

The challenge is not simply to maintain government interests in these enterprises. It is to ensure that ownership translates into performance, that weaknesses are identified and addressed and that public investments continue to serve the country’s economic and social interests.

This responsibility is reflected in five values that OTR has placed at the centre of its work: Excellence, Innovation, Integrity, Collaboration and Impact.

They provide a standard against which the institution’s decisions and conduct are expected to be judged. Treasury Registrar Nehemiah Mchechu is demanding for excellence is closely tied to the need to improve how government investments are managed.

OTR’s position that good enough is never good enough reflects an expectation that standards should keep rising, rather than remain fixed at the level of what has already been achieved.

Excellence is measured not by compliance with administrative procedures alone, but by how well public enterprises are managed, how efficiently they use their resources and how effectively they fulfil their mandates.

Oversight must be informed by a clear understanding of the businesses involved and the conditions in which they operate. It also requires the people responsible for public investments to have the professional knowledge to question performance, recognise risks and offer sound advice.

Where weaknesses persist, identifying them is only part of the job; the more important task is ensuring that they are addressed. This emphasis on professional ownership is consistent with the direction of international corporate governance practice.

The Organisation for Economic Co-operation and Development (OECD), in its 2024 Guidelines on Corporate Governance of StateOwned Enterprises, calls for governments to exercise their ownership responsibilities professionally, set clear objectives and ensure that state-owned enterprises have capable boards to provide strategic direction.

The reason is straightforward: public ownership, on its own, does not make an enterprise successful. Results depend on the quality of its leadership, the discipline with which it is run and the ability of those overseeing it to hold management accountable.

But professional oversight must also keep pace with changes in the business environment. Public enterprises cannot afford to remain tied to business practices that no longer serve them well.

Changes in technology, customer expectations and the cost of doing business require them to review how they operate and look for better ways to remain efficient and competitive.

The ability of public enterprises to adapt is becoming increasingly important. Those that fail to review their operations and respond to changing business conditions may struggle to remain efficient and competitive.

Innovation is therefore central to OTR’s efforts to encourage fresh thinking and more effective ways of working within the institution and across the entities under its oversight.

It is important for companies to embrace innovation which involve adopting technology, improving production methods, reaching new markets or finding more efficient ways to deliver services.

At the level of investment oversight, it means improving how information is collected and analysed, making better use of performance data and identifying risks and opportunities early enough for action to be taken.

Mr Mchechu emphasised that these ambitions must be accompanied by integrity, particularly because OTR’s work involves safeguarding interests held on behalf of the public.

“Excellence, innovation and integrity are fundamental to how we manage government investments,” he said. Adding: “We must continuously raise our standards, embrace better ways of working and ensure that every decision is guided by transparency, accountability and the national interest.”

Integrity is not an abstract expectation in the management of public wealth. It is reflected in how decisions are reached, how authority is exercised and whether those entrusted with public responsibilities can account for their actions. It also calls for safeguards against conflicts of interest, misconduct and the misuse of institutional power.

The principle is that public investments must be managed with honesty and transparency, including when decisions are difficult or when scrutiny is limited.

The OECD guidelines similarly place importance on disclosure, accountability, internal controls and risk management as essential parts of sound state ownership. Even with professional management and clear accountability, however, public enterprises do not operate in isolation.

Their performance can be affected by decisions made elsewhere in government, the availability of infrastructure and finance, relationships with suppliers and the quality of engagement between boards and management teams. The ability to work across these relationships is, therefore, important.

OTR’s value of collaboration recognises that progress depends on institutions and individuals working towards shared objectives, rather than pursuing their responsibilities in isolation.

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Director of Administration and Human Resources Management at the OTR Chacha Marigiri said collaboration was important in bringing people and institutions together around common goals.

For an institution overseeing such a varied portfolio, this involves constructive engagement with boards and management teams, as well as cooperation with other public institutions whose decisions may affect investment performance.

Such engagement can help bring different experience and expertise to bear on problems that one institution may not be able to resolve alone. It can also improve the exchange of information, help clarify responsibilities and make it easier to address issues affecting the performance of public enterprises.

The OECD’s governance guidelines also recognise the importance of relationships with stakeholders, including employees, creditors, customers and affected communities.

State-owned enterprises must esnure that responsible engagement is part of building trust and managing the wider consequences of business decisions. Ultimately, however, the value of working together must be seen in the results it produces.

This is the concern behind OTR’s emphasis on Impact, which places longterm economic and social value at the centre of public investment management. Mr Marigiri said the two values were closely linked, with collaboration providing the means to work towards shared goals and impact reflecting the results of those efforts.

“Collaboration enables us to achieve more through collective effort, while impact reminds us that our work must deliver lasting results,” he said. He went on to add: “Ultimately, the value of our efforts should be reflected in the economic and social benefits that government investments generate for Tanzanians.”

That view brings a wider consideration into the assessment of public enterprises. Financial performance remains essential, but the contribution of an investment cannot always be captured by its financial returns alone. Public enterprises also operate in sectors that support employment, productive activity, access to essential services and the growth of other businesses.

The task is to secure these wider benefits without allowing commercial discipline to weaken. Enterprises still need sound financial management, efficient operations and the capacity to sustain themselves.

Where public policy requires them to provide essential services, their obligations must be managed in a way that recognises both their public purpose and the resources needed to fulfil it. This balance will matter as Tanzania works towards the ambitions of Dira 2050.

The country’s long-term development agenda calls for a more productive, competitive and inclusive economy, in which investment has a central role. Public enterprises are part of that picture, but their contribution will depend on whether they are capable of performing effectively and creating value.