Executive summary promoting strategies to maximise the benefits from regional integration and mitigate its negative impact of external shocks on the domestic economy. 4.3 Corporate governance 4.30 Lesotho subscribes to the eight international and regional standards and codes for corporate governance assessment, but there is lack of progress in implementation. There is no national corporate governance code. A few institutions are active in promoting corporate governance, notably the CBL and the Lesotho Institute of Accountants (LIA), but, on the whole, the level of awareness regarding matters of corporate governance and corporate social responsibility (CSR) is low. 4.31 The business environment in Lesotho is characterised by private sector and parastatal organisations. The private sector is distributed across transport, manufacturing, mining, banking and financial services, as well as the supply of goods and services. Lesotho’s enterprises profile is as follows: micro (65 per cent), small (20 per cent), medium (12 per cent) and large (3 per cent). Of these enterprises, 75 per cent were in services, 24 per cent in manufacturing and 1 per cent in primary industry. In 2006, enterprise ownership was reported as the Basotho owning 69.4 per cent, with Asians owning 16.5 per cent, South Africans 5.9 per cent and others 8.2 per cent. 4.32 The legal and regulatory framework governing business activity includes the following statutes: the Trading Enterprises Order (1993); the Trading Enterprises Regulation (1999); the FIA (1999); the Money Lenders Order (1989); the Companies Act (1967, as amended in 1984 & 1989); the Partnership Proclamation (1957); and the Insolvency Proclamation (1957). The tax regime is regulated by three pieces of legislation, namely the Customs and Excise Act (1982), the Income Tax Act (1993) and the Value-Added Tax (VAT) Act of 2001. The effectiveness of the above statutes is hampered by the antiquity of most of the laws. Commendably, a number of laws are currently undergoing revision, including the Companies Act of 1967, the Accountants Act and the Insurance Act. Several other pieces of legislation relevant to business, such as creditors and competition legislation, are also being enacted. On the whole, however, the legislative process is inordinately long, in part due to capacity constraints and institutional inertia. For instance, the review of the Companies Act and the Land Act has taken over five years. 4.33 Other constraints to an enabling business environment include inadequate infrastructure and human-capital development, weak development management capacity, the impact of HIV and AIDS, as well as institutional weaknesses, including weak property rights, delays in commercial dispute resolution and inadequate access to finance. 4.34 The constitution of Lesotho, in section 36, mandates the country to protect the environment, and the country subscribes to international environmental conventions, including the 1992 UN Rio Declaration. Nonetheless, Lesotho still faces environmental challenges such as pollution, the expansion of urban settlements, uncontrolled mining and poor waste management. 4.35 Labour standards in Lesotho are generally considered to be relatively good. This is attributable to individual and collective efforts by the government, trade unions and international buyers such 9