Ebenezer Asante, Senior Vice President of MTN Group, has called for targeted reforms and innovative business models to mitigate the increasing risks faced by Ghanaian businesses, particularly those operating informally and in concentrated sectors. Asante made these remarks at the Arganbright Partners Convergence Conference in Accra, which focused on “Governance and Ethics in the 21st Century: A Path to Sustainable Value Creation.” He highlighted that businesses overly dependent on a single industry are highly vulnerable to economic fluctuations, a situation exacerbated when operations are informal.
Context of Business Vulnerability
Ghana’s business landscape includes a significant informal sector, which often operates with less regulatory oversight and access to formal financing. This informality, coupled with a tendency for businesses to specialize heavily in one sector, creates a precarious environment. Economic shocks, such as currency depreciation, changes in commodity prices, or shifts in consumer demand, can disproportionately impact these businesses.
The reliance on a single sector means that downturns in that specific industry can have catastrophic effects. For example, a business solely focused on agricultural exports might be devastated by a sudden drop in global prices or adverse weather conditions. Similarly, a company heavily invested in a particular manufacturing sub-sector could struggle if that sub-sector faces import competition or regulatory changes.
Addressing Concentration and Informality
Mr. Asante emphasized the critical need for “bespoke regulatory frameworks” designed to support and sustain “made-in-Ghana” businesses. These tailored policies, he argued, are essential for fostering resilience and long-term viability among indigenous enterprises.
He noted that some businesses are proactively adapting by exploring capital markets, such as listing on the stock exchange. This move not only helps in diversifying risk but also promotes formalization and professionalization of business operations, according to Asante.
“Some of these heavily concentrated businesses are beginning to go to the stock market and finding innovative ways of diversifying risk and helping to formalize and professionalize the way businesses run,” he stated during the conference.
Fostering Localized Business Models
Beyond structural and regulatory changes, Asante challenged business leaders and academic institutions to develop locally relevant business models. He advocated for case studies that reflect the growth journeys of Ghanaian entrepreneurs, using examples like success stories originating from markets like Makola, rather than solely relying on international business case studies, such as those from Harvard.
This call for localized models aims to provide practical, relatable, and context-specific strategies for growth that resonate with the realities of the Ghanaian market. It encourages a focus on indigenous innovation and adaptation.
Role of State Institutions and Academia
Asante also urged state institutions and universities to champion reforms that cultivate an enabling environment for business growth. This includes fostering innovation and ensuring sustainable value creation. The conference itself served as a platform for business executives and stakeholders to discuss governance, ethical leadership, and strategies for building resilient businesses.
Implications and Future Outlook
The insights shared by Mr. Asante underscore a growing recognition of the systemic risks facing businesses in developing economies like Ghana. The push for tailored regulations and the encouragement of diversified risk strategies, including access to capital markets, signal a potential shift towards greater corporate resilience.
For Ghanaian businesses, this trend suggests a greater emphasis on formalization, robust governance, and strategic diversification. The development and adoption of locally relevant business models could unlock new avenues for growth and innovation, potentially strengthening the overall economy. Stakeholders will be watching to see how regulatory bodies and academic institutions respond to these calls for reform and how businesses themselves adapt their strategies in the coming years.
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