[vc_row type=”vc_default” full_width=”stretch_row_content_no_spaces” css=”.vc_custom_1500547593342{padding-right: 100px !important;}” el_class=”noPaddinRow”][vc_column width=”1/6″ el_class=”noPaddingLeft” offset=”vc_hidden-md vc_hidden-sm vc_hidden-xs”][vc_raw_html]JTNDZGl2JTIwY2xhc3MlM0QlMjJtYWluLXN0cmlwJTIyJTNFJTBBJTNDZGl2JTIwY2xhc3MlM0QlMjJibHVlLXN0cmlwMCUyMiUzRSUzQyUyRmRpdiUzRSUwQSUzQ2RpdiUyMGNsYXNzJTNEJTIyYmx1ZS1zdHJpcDElMjIlM0UlM0MlMkZkaXYlM0UlMEElM0NkaXYlMjBjbGFzcyUzRCUyMmJsdWUtc3RyaXAyJTIyJTNFJTNDJTJGZGl2JTNFJTBBJTNDJTJGZGl2JTNF[/vc_raw_html][/vc_column][vc_column width=”5/6″ el_class=”justifyText” css=”.vc_custom_1530544522141{padding-right: 310px !important;}” offset=”vc_hidden-md vc_hidden-sm vc_hidden-xs”][vc_empty_space height=”50px”][vc_row_inner el_id=”newsletters”][vc_column_inner width=”1/6″][/vc_column_inner][vc_column_inner width=”2/3″][vc_custom_heading text=”Emerging Corporate Governance Trends in Nigeria” font_container=”tag:h1|font_size:22|text_align:justify|color:%236699cc|line_height:1.8″ use_theme_fonts=”yes”][/vc_column_inner][vc_column_inner width=”1/6″][/vc_column_inner][/vc_row_inner][vc_empty_space height=”25px”][vc_column_text]Corporate Governance is a set of processes, customs, policies, laws and institutions affecting the way a corporation is directed, administered or controlled. Discernable Corporate Governance principles include: integrity and ethical behavior; disclosure and transparency; equitable treatment of shareholders and efficient discharge of Board responsibilities and functions. Sound Corporate Governance principles are the foundation upon which investor confidence is built. Recently, Corporate Governance practices have assumed front burner dimensions in Nigeria.

Why now?

  • Several reasons can be adduced for the emergence of corporate governance trends in Nigeria. Prominent among them are:
  • Increased public ownership of companies. This factor plays out visibly in the Banking industry. The 2005 Bank consolidation exercise set the stage for several initial public offers in which the investing public acquired shares of Banks. Consequently, proper appropriation of investors’ funds has become a mantra for Bank executives, as the investing public watches closely how Bank finances are managed.
  • The current government stance on anti-corruption and rule of law.
  • Judicial activism renaissance by Nigerian courts as evinced by their recent decisions in various spheres. For example, the shock waves created by the election petitions judgments.
    The consequences of these catalysts of change are manifold. A highlighted example is the flurry of class actions recently experienced in the country: Cadbury Nigeria Plc’s shareholders sued the company for loss suffered due to account overstatement and negligence; First Bank Plc’s share subscribers brought an action for damages after their money was held over because the public offer was oversubscribed. Not to forget, the State Governments claim against British American Tobacco for health bills incurred by the state governments due to tobacco induced ailments.

WHAT ARE THE NEW TRENDS?

  • New Central Bank corporate governance regulations.
    The Central Bank of Nigeria in the exercise of her oversight functions spelt out the following post-consolidation regulations aimed at promoting corporate governance practices in the banking industry. These include:

    • The separation of the role of the chairman of the Board of Directors from that of the Managing Director. Henceforth, the office will be occupied by two different people
    • Government cannot hold (directly or indirectly) more than 10% of any bank.
    • It is no longer possible for two members of an extended family to be Chairman and Chief Executive Officer or Executive Director at the same time.
    • Equity holding in excess of 10% in any Bank requires prior approval of the Central Bank.
  • Recent Securities & Exchange Commission’s (S.E.C.) Interventions.
    S.E.C. has re-organized its house so as to meet corporate governance demands. Measures taken include:

    • Rigorous registration for Capital Market Operators.
    • Introduction of Professional Indemnity Insurance.
    • Introduction of half yearly report format for Public Limited Companies.
    • Increased Share Capital for Stockbrokers.
  • Disclosure obligations under the Economic and Financial Crimes Commission (E.F.C.C.) Act.
    Presently, Designated Non-Financial Institutions (D.F.N.I.s) are duty bound to make rendition of suspicious transaction reports. D.F.N.I.s under the Act includes:

    • Chartered Accountants
    • Audit Firms
    • Tax Consultants
    • Legal Practitioners.
  • Director’s Culpability under the Companies Act.
    It must however be noted that Corporate Governance culture was not alien to our business climate prior to these developments. The Companies and Allied Matters Act LFN 2004, provides for Director’s liability for misappropriation of company funds. Though this provision has not been fully tested and adjudicated upon in court, it is one of the provisions waiting to come alive under the new corporate governance spirit.

It is important to note that Corporate Governance and increase in flow of foreign investment seem to go hand – in – hand. Canadian Companies for example were ranked first in Corporate Governance in 2006 (Study conducted by Governance/Metrics International, reviewed by Bloomberg, September 2006). No wonder Canada has consistently attracted foreign investment over the years, – a whooping $448.9 billion as at 2006.

At DETAIL, we see Corporate Governance as a joint effort between the government and the private sector. The bulk of responsibility however falls with the corporate citizens. It is all about what we do or fail to do. Or simply how we do it![/vc_column_text][/vc_column][/vc_row][vc_row type=”vc_default” full_width=”stretch_row_content_no_spaces” css=”.vc_custom_1500547593342{padding-right: 100px !important;}” el_class=”noPaddinRow”][vc_column el_class=”noPaddingLeft” offset=”vc_hidden-lg vc_hidden-xs”][vc_raw_html]JTNDZGl2JTIwY2xhc3MlM0QlMjJ0YWItbWFpbi1zdHJpcCUyMiUzRSUwQSUzQ2RpdiUyMGNsYXNzJTNEJTIydGFiLWJsdWUtc3RyaXAwJTIyJTNFJTNDJTJGZGl2JTNFJTBBJTNDZGl2JTIwY2xhc3MlM0QlMjJ0YWItYmx1ZS1zdHJpcDElMjIlM0UlM0MlMkZkaXYlM0UlMEElM0NkaXYlMjBjbGFzcyUzRCUyMnRhYi1ibHVlLXN0cmlwMiUyMiUzRSUzQyUyRmRpdiUzRSUwQSUzQyUyRmRpdiUzRQ==[/vc_raw_html][vc_empty_space height=”25px”][vc_row_inner][vc_column_inner width=”1/6″][/vc_column_inner][vc_column_inner width=”2/3″][vc_custom_heading text=”Emerging Corporate Governance Trends in Nigeria” font_container=”tag:h1|font_size:22|text_align:justify|color:%236699cc|line_height:1.8″ use_theme_fonts=”yes”][vc_column_text]Corporate Governance is a set of processes, customs, policies, laws and institutions affecting the way a corporation is directed, administered or controlled. Discernable Corporate Governance principles include: integrity and ethical behavior; disclosure and transparency; equitable treatment of shareholders and efficient discharge of Board responsibilities and functions. Sound Corporate Governance principles are the foundation upon which investor confidence is built. Recently, Corporate Governance practices have assumed front burner dimensions in Nigeria.

Why now?

  • Several reasons can be adduced for the emergence of corporate governance trends in Nigeria. Prominent among them are:
  • Increased public ownership of companies. This factor plays out visibly in the Banking industry. The 2005 Bank consolidation exercise set the stage for several initial public offers in which the investing public acquired shares of Banks. Consequently, proper appropriation of investors’ funds has become a mantra for Bank executives, as the investing public watches closely how Bank finances are managed.
  • The current government stance on anti-corruption and rule of law.
  • Judicial activism renaissance by Nigerian courts as evinced by their recent decisions in various spheres. For example, the shock waves created by the election petitions judgments.
    The consequences of these catalysts of change are manifold. A highlighted example is the flurry of class actions recently experienced in the country: Cadbury Nigeria Plc’s shareholders sued the company for loss suffered due to account overstatement and negligence; First Bank Plc’s share subscribers brought an action for damages after their money was held over because the public offer was oversubscribed. Not to forget, the State Governments claim against British American Tobacco for health bills incurred by the state governments due to tobacco induced ailments.

WHAT ARE THE NEW TRENDS?

  • New Central Bank corporate governance regulations.
    The Central Bank of Nigeria in the exercise of her oversight functions spelt out the following post-consolidation regulations aimed at promoting corporate governance practices in the banking industry. These include:

    • The separation of the role of the chairman of the Board of Directors from that of the Managing Director. Henceforth, the office will be occupied by two different people
    • Government cannot hold (directly or indirectly) more than 10% of any bank.
    • It is no longer possible for two members of an extended family to be Chairman and Chief Executive Officer or Executive Director at the same time.
    • Equity holding in excess of 10% in any Bank requires prior approval of the Central Bank.
  • Recent Securities & Exchange Commission’s (S.E.C.) Interventions.
    S.E.C. has re-organized its house so as to meet corporate governance demands. Measures taken include:

    • Rigorous registration for Capital Market Operators.
    • Introduction of Professional Indemnity Insurance.
    • Introduction of half yearly report format for Public Limited Companies.
    • Increased Share Capital for Stockbrokers.
  • Disclosure obligations under the Economic and Financial Crimes Commission (E.F.C.C.) Act.
    Presently, Designated Non-Financial Institutions (D.F.N.I.s) are duty bound to make rendition of suspicious transaction reports. D.F.N.I.s under the Act includes:

    • Chartered Accountants
    • Audit Firms
    • Tax Consultants
    • Legal Practitioners.
  • Director’s Culpability under the Companies Act.
    It must however be noted that Corporate Governance culture was not alien to our business climate prior to these developments. The Companies and Allied Matters Act LFN 2004, provides for Director’s liability for misappropriation of company funds. Though this provision has not been fully tested and adjudicated upon in court, it is one of the provisions waiting to come alive under the new corporate governance spirit.

It is important to note that Corporate Governance and increase in flow of foreign investment seem to go hand – in – hand. Canadian Companies for example were ranked first in Corporate Governance in 2006 (Study conducted by Governance/Metrics International, reviewed by Bloomberg, September 2006). No wonder Canada has consistently attracted foreign investment over the years, – a whooping $448.9 billion as at 2006.

At DETAIL, we see Corporate Governance as a joint effort between the government and the private sector. The bulk of responsibility however falls with the corporate citizens. It is all about what we do or fail to do. Or simply how we do it![/vc_column_text][/vc_column_inner][vc_column_inner width=”1/6″][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row][vc_row type=”vc_default” full_width=”stretch_row_content_no_spaces” css=”.vc_custom_1500547593342{padding-right: 100px !important;}” el_class=”noPaddinRow”][vc_column el_class=”noPaddingLeft” offset=”vc_hidden-lg vc_hidden-md vc_hidden-sm” css=”.vc_custom_1530544442908{padding-right: 75px !important;padding-left: 60px !important;}”][vc_raw_html]JTNDZGl2JTIwY2xhc3MlM0QlMjJtb2ItbWFpbi1zdHJpcCUyMiUzRSUwQSUzQ2RpdiUyMGNsYXNzJTNEJTIybW9iLWJsdWUtc3RyaXAwJTIyJTNFJTNDJTJGZGl2JTNFJTBBJTNDZGl2JTIwY2xhc3MlM0QlMjJtb2ItYmx1ZS1zdHJpcDElMjIlM0UlM0MlMkZkaXYlM0UlMEElM0NkaXYlMjBjbGFzcyUzRCUyMm1vYi1ibHVlLXN0cmlwMiUyMiUzRSUzQyUyRmRpdiUzRSUwQSUzQyUyRmRpdiUzRQ==[/vc_raw_html][vc_empty_space height=”25px”][vc_row_inner][vc_column_inner width=”1/6″][/vc_column_inner][vc_column_inner width=”2/3″][vc_custom_heading text=”Emerging Corporate Governance Trends in Nigeria” font_container=”tag:h1|font_size:22|text_align:justify|color:%236699cc|line_height:1.8″ use_theme_fonts=”yes”][vc_column_text]Corporate Governance is a set of processes, customs, policies, laws and institutions affecting the way a corporation is directed, administered or controlled. Discernable Corporate Governance principles include: integrity and ethical behavior; disclosure and transparency; equitable treatment of shareholders and efficient discharge of Board responsibilities and functions. Sound Corporate Governance principles are the foundation upon which investor confidence is built. Recently, Corporate Governance practices have assumed front burner dimensions in Nigeria.

Why now?

  • Several reasons can be adduced for the emergence of corporate governance trends in Nigeria. Prominent among them are:
  • Increased public ownership of companies. This factor plays out visibly in the Banking industry. The 2005 Bank consolidation exercise set the stage for several initial public offers in which the investing public acquired shares of Banks. Consequently, proper appropriation of investors’ funds has become a mantra for Bank executives, as the investing public watches closely how Bank finances are managed.
  • The current government stance on anti-corruption and rule of law.
  • Judicial activism renaissance by Nigerian courts as evinced by their recent decisions in various spheres. For example, the shock waves created by the election petitions judgments.
    The consequences of these catalysts of change are manifold. A highlighted example is the flurry of class actions recently experienced in the country: Cadbury Nigeria Plc’s shareholders sued the company for loss suffered due to account overstatement and negligence; First Bank Plc’s share subscribers brought an action for damages after their money was held over because the public offer was oversubscribed. Not to forget, the State Governments claim against British American Tobacco for health bills incurred by the state governments due to tobacco induced ailments.

WHAT ARE THE NEW TRENDS?

  • New Central Bank corporate governance regulations.
    The Central Bank of Nigeria in the exercise of her oversight functions spelt out the following post-consolidation regulations aimed at promoting corporate governance practices in the banking industry. These include:

    • The separation of the role of the chairman of the Board of Directors from that of the Managing Director. Henceforth, the office will be occupied by two different people
    • Government cannot hold (directly or indirectly) more than 10% of any bank.
    • It is no longer possible for two members of an extended family to be Chairman and Chief Executive Officer or Executive Director at the same time.
    • Equity holding in excess of 10% in any Bank requires prior approval of the Central Bank.
  • Recent Securities & Exchange Commission’s (S.E.C.) Interventions.
    S.E.C. has re-organized its house so as to meet corporate governance demands. Measures taken include:

    • Rigorous registration for Capital Market Operators.
    • Introduction of Professional Indemnity Insurance.
    • Introduction of half yearly report format for Public Limited Companies.
    • Increased Share Capital for Stockbrokers.
  • Disclosure obligations under the Economic and Financial Crimes Commission (E.F.C.C.) Act.
    Presently, Designated Non-Financial Institutions (D.F.N.I.s) are duty bound to make rendition of suspicious transaction reports. D.F.N.I.s under the Act includes:

    • Chartered Accountants
    • Audit Firms
    • Tax Consultants
    • Legal Practitioners.
  • Director’s Culpability under the Companies Act.
    It must however be noted that Corporate Governance culture was not alien to our business climate prior to these developments. The Companies and Allied Matters Act LFN 2004, provides for Director’s liability for misappropriation of company funds. Though this provision has not been fully tested and adjudicated upon in court, it is one of the provisions waiting to come alive under the new corporate governance spirit.

It is important to note that Corporate Governance and increase in flow of foreign investment seem to go hand – in – hand. Canadian Companies for example were ranked first in Corporate Governance in 2006 (Study conducted by Governance/Metrics International, reviewed by Bloomberg, September 2006). No wonder Canada has consistently attracted foreign investment over the years, – a whooping $448.9 billion as at 2006.

At DETAIL, we see Corporate Governance as a joint effort between the government and the private sector. The bulk of responsibility however falls with the corporate citizens. It is all about what we do or fail to do. Or simply how we do it![/vc_column_text][/vc_column_inner][vc_column_inner width=”1/6″][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row][vc_row type=”vc_default” full_width=”stretch_row” el_class=”footerWidget”][vc_column width=”1/4″][/vc_column][vc_column width=”2/4″][vc_row_inner][vc_column_inner width=”3/4″][/vc_column_inner][vc_column_inner width=”1/4″][/vc_column_inner][/vc_row_inner][/vc_column][vc_column width=”1/4″][/vc_column][/vc_row]