University of Vaasa - Vaasan yliopisto

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economic and institutional development in these two countries are too far apart,
(which is true) Finland being one of the most stable economies in the developed
world while Zambia is one of the poorest nations on the planet with very weak
institutional frameworks, and is plagued with endemic corruption. Such an argument
might suggest that those differences might question the representativeness of the
outcome of such comparative studies. However, as Zattoni and Cuomo (2008) posit,
countries more exposed to other national economic systems experience greater
pressure to harmonize and legitimate their governance practices. Therefore, it is
assumed by this researcher that Finland having a well developed and expansive
industrial base that operate in a market with minimal cases of cronyism, corporatism
and corruption must have well developed and institutionalised best practices that
allow the economy to self regulate. It is hoped in that respect that the specific
comparative case studies will provide an opportunity to see how Finland has used
corporate governance principles built on the four pillars (fairness, accountability,
transparency and responsibility) in state-owned and public enterprises as tools for
contributing to the broader sustainable development agenda of the country, at the
same time expose areas where particularly Zambia can learn from, both in theory and
practice through benchmarking corporate governance standards in Zambia and
Finland's best practice standards.
Problem Description
The African continent is undoubtedly blessed with numerous rich resources, at the
same time it remains the poorest on the planet in all forms of the word. Zambia like
many African countries depends largely on foreign investments and aid to sustain its
economy. Therefore, as it struggles to position itself in the race to attract those
investments, alleviate poverty, achieve functional democratic governance, and move
a step further towards achieving the millennium development goals, later on its
vision 2030, the need for working approaches to sustainable economic reform
remains critical. In the period prior to the onset of the current global economic
meltdown, the country exhibited fairly strong macroeconomic growth figures, part of
which was attributed to strong performances in the mining industry and debt relief as
a result of the country’s attainment of the Highly Indebted Poor Countries (HIPC)
completion point which meant that instead of servicing external debt, the country
could channel its generated revenue into the development of various sectors of the
economy. However, much of that growth was merely on paper because there is little
evidence that any of it translated into real benefits for the poor majority, and that is
largely because of the unequal distribution of income and opportunity, weak
institutional and governance frameworks and most of all, sheer greed by individuals
entrusted with the management of public resources.
Evidence of these weaknesses in the country's economic governance structures can
be seen in the recent misappropriation of K27 billion or (USD 5 million) see:
http://www.lusakatimes.com/?p=12373, by a few Ministry of Health officials, which
led to the suspension of aid by two countries - Netherlands and Norway. This scandal
and many others both in public and private sectors point to the fact that there is a
serious breakdown in both the internal and external control mechanisms, lack of