Recession: Can Corporate Governance be panacea?
KAYODE KETEFE
Adherence to the principles of Corporate Governance offers a great promise for Nigeria in her quest to come out of recession.
This being because Corporate Governance principles like proper devolution of powers, effectiveness of board, disclosure and transparency, accountability, risk management and internal control, compliance, stakeholders relationship management, succession planning etc. all play a major role on the health and sustainability of business operations.
Adherence to good Corporate Governance Practice can therefore impact positively on all the spheres of a nation's socio-economic endeavours, leading to Nigeria wriggling out of economic recession and laying the foundations of sustainable economic development
The above was the conclusions reached by resource persons at the recently concluded 2016 Annual Conference of the Institute of Chartered Secretaries and Administrators of Nigeria (ICSAN) which this writer attended.
The conference which was held at the Sheraton Lagos Hotel, Ikeja Lagos on Thursday November 17, 2016, had the theme "Corporate Governance as springboard of socio-economic renaissance"
There were three sub-themes: these were (i) Ethics as a Pathway to Sustainable Corporate Success; (ii) Corporate Governance: Exploring the Indian Example, and (iii) The Chartered Secretary and Administrator as an Agent of Governance Transformation in Nigeria.
This conference was declared open by a Past President, Chartered Institute of Bankers of Nigeria CIBN) Mr. Femi Ekundayo, FCIB, while the President Nigerian Bar Association (NBA), Mr. Abubakar Mahmoud, SAN, who was represented by the by the General Secretary of the NBA, Mr. Olagunju Isiaka) gave the Keynote Address.
The speakers at the plenary session were the Managing Director/CEO, Mutual Benefits Assurance Plc, Dr. Akin Ogunbiyi, (represented by an Executive Director in the organisation, Mr. Gbenga Ogunko); the Director , Customer Care, Corporate Affairs Commission (CAC), Lady Azuka Azinge, and an ICSAN Council Member and Principal Founder of H. Michael and Co. Mr. Adeyinka Hassan, FCIS.
All these speakers, together with a panel of nine discussants, offered views from different perspectives around the theme, they were however unanimous that observance of good Corporate Governance practices had the potentials to move Nigeria out of the present state of recession as well as putting her on the path of sustainable prosperity
While delivering the goodwill address, the President of the Institute, Dr. Nat Ofo FCIS, said "Nigeria is currently undergoing recession with its concomitant legions of underlying challenges, like shrinking of socioeconomic enterprises, rising inflation, dwindled value of Naira, low capacity utilisation in the real sector, mass retrenchment in many industries exacerbating the already very high rate of unemployment, falling average incomes, increased inequality and stultified national growth.
"Against this background, it is well understood why ICSAN chose a theme such as this for this year's Conference. It is in keeping with our tradition to engage contemporary issues with a view to proffer solutions to them after thorough brainstorming sessions by seasoned technocrats and top professionals drawn from the appropriate industries."
In his speech, Dr. Akin Ogunbiyi, said "It is worthy of note that the major goal of good corporate governance is its tremendous impact on economic efficiency as a safeguard for shareholders welfare. While investors need to be protected through regulation, it is also important for the issuers of securities to adhere to good corporate practices which enable companies to attract financial and human capital, perform efficiently and thereby remain sustainable by generating long term economic values for shareholders while respecting the interests of stakeholders and the society at large"
A speaker, Mr. Adeyinka Hassan who presented a well-received paper entitled "Corporate Governance: Exploring the Indian Example" recommended, among other things, that "Indian Corporate Governance is industry driven, Nigerian industry sectors should develop strong participation in all the reform efforts. The Nigerian Corporate Governance should also bench mark frameworks from international best practices.
"Government participation in the conversation for improved Corporate Governance should be balanced with public engagements. Nigerian Government should encourage industry players in the drive for Corporate Governance reforms."
Having observed, among other things, that the appalling state of affairs of the Nigerian economy requires urgent, sustained and concerted measures of all the stakeholders the forum recommended Regulatory agencies should be more proactive in ensuring compliance that reflects the intents and the spirit of law, governance codes and regulations as against mere perfunctory compliance,which does not augur well for the desired governance transformation.
It was said that one of the ways regulatory agencies could do this is by periodic reviewing and monitoring Corporate Governance rules and practices.
It was further recommended that Nigeria should expunge all obsolete legislations from her statute books and make good, modern ad progressive laws in their place since the nation cannot afford to be lagging behind in any area of development in this era of intense competition and globalised economy.
That as key players in corporate administration, conscience of the company and sounding board on matters of Corporate Governance, due recognition should be given to Chartered Secretaries both by the government and the private sector. Chartered Secretaries should be seen as natural partners in the bid promote sound, ethical, ad durable business culture
Finally, there was consensus that the National Code of Corporate Governance recently released by the Financial Reporting Council of Nigeria (FRC) not only encapsulates the trending best practices but also reflects the peculiarities of Nigerian socioeconomic clime, the Forum therefore call for removal of suspension placed on it at present to pave way for its prompt implementation.
KETEFE is the Head of Research Unit at the institute of Chartered Secretaries and Administrators of Nigeria (ICSAN)
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