The modern operational arrangement of Government Business Enterprises (GBEs) has received considerable attention and been subject to much debate. The focus of public and political attention has been on managerial effectiveness in setting its governance, strategies and developing capabilities to achieve performance, both financial performance and accountability requirements. This study is structured as followed. First, the study explores the concepts of corporate governance, strategy, capabilities and accountability in the context of GBEs. Second, the study investigates relationships between GBEs'governance arrangements and performance, on the one hand, and capabilities-strategy match and performance on the other hand. Third, the study investigates the moderating effects of GBEs' board governance arrangements on the relationship between capabilities-strategy match and performance. New insights can be obtained from the study for policy makers, GBE's board of directors and management,particularly in the area that affecting GBE''s performance.