Institutionalising Good Corporate Governance
Never before has the issue of good governance within the polity and indeed, corporate governance in the private sector become imperative and compelling. Over the weekend, the media published a damning report released by the National Bureau of Statistics on the Second Corruption Survey Report in Nigeria.
The report indicted many agencies of the Federal Government, and Kogi, Gombe and Rivers States as the most corrupt states in the country.
In the private sector, many companies in the oil and gas, banking and finance and manufacturing industries are not left out of unethical and criminal governance! To talk about bad governance in the country’s corporate world would need ages.
The foregoing are worrisome issues that should call for a radical solution if our quest for development and growth should have any positive meaning.
Simply put, we must institutionalise good corporate governance within the economy, and good governance within the polity. As presently constituted, corruption, also known as bad governance is eclipsing all of us.
What is our understanding of Governance? Governance is ‘the process of collective decision-making and policy implementation, used distinctly from government to reflect broader concern with norms and processes relating to the delivery of public goods (Mclean and Mcmillan).’
According to the World Bank, Governance is ‘the manner in which power is exercised in the management of a country’s economic and social resources for development.’
Good governance is all about following due process, observing ethical standards and ensuring the enthronement of transparency, accountability and probity in our endeavours.
Sapru in Administrative Theories and Management Thought (3rd edition) states that ‘The World Bank has identified three distinct aspects of governance: (a) the form of political regime; (b) the process by which authority is exercised for managing a country’s economic and social resources for development; and (c) the capacity of government to design, formulate and implement policies and discharge functions.’
These three areas identified by the bank as the crucial elements of governance ought to be institutionalised in our polity. Our economy cannot thrive under unbridled and chaotic governance.
The executive, the legislature and the judiciary must perform optimally, responsibly and responsively. They must all eschew corruption like the plague.
For the corporate world, the Financial Reporting Council of Nigeria is saddled with the responsibility of ensuring good corporate governance practices within companies operating in the country. In 2018, the council rolled out the Nigerian Code of Corporate Governance.
The code incorporates the introductory aspects and touches on many issues including transparency, sustainability, business conduct and ethics, relationship with shareholders, assurance, corporate governance evaluation and ancillary matters.
Regrettably, the council has not done much in the area of advocacy and sensitisation as cases of infraction are up within the economy. The code therefore, requires a lot of expose and compliance.
This brings to the fore the need for the professional body that is prided as the corporate professionals, the Institute of Chartered Secretaries and Administrators of Nigeria (ICSAN) to come on board to deliver the corporate world in association with the council (FRCN), the Securities and Exchange Commission (SEC), the Nigerian Stock Exchange (NSE) and other bodies sharing the same objectives.
The leadership of ICSAN led by Bode Ayeku must assume leadership if not ownership of ‘Governance Project in Corporate Nigeria’. And, it many need to partner with the media including print, electronic and social to achieve this goal.
No amount of ‘Ease of Doing Business’ in the country can ensure economic resurgence if our corporate governance is below globally permissible limit. The corporate professionals must strategize to deliver on its mandate. It is a wakeup call.
It is imperative that we give meaning to corporate governance as ‘a key driver of corporate accountability and business prosperity’.
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The sectoral codes developed by industry regulators including the Codes of Corporate Governance for the Telecommunication Industry, Banks and Discount Houses, Public Companies, Insurance Industry, and Licensed Pension Fund Operators should be exposed and marketed to the general public for effective and efficient delivery.
‘The challenge of governance in any state (country) is not competitive populism or some fulfilment of some wish lists. It is in restoring the basic values to these institutions and ensuring their sustenance through truly autonomous watchdog processes (Sapru).
The Institute of Chartered Secretaries and Administrators of Nigeria as corporate governance professionals in conjunction with the Financial Reporting Council of Nigeria and perhaps, other similar bodies should take the lead and deliver corporate Nigeria from discreditable conduct, unethical practices and other acts that are inimical to good governance.
For all that we care to know, ‘corporate governance requirements are expected to increase substantially (Thomson Reuters)’ in this spectre of globalisation, a world without frontiers. It is therefore, a desideratum for an economy of our size, the largest in Africa to institutionalise good corporate governance.
Yes, we have the Code, but how operational and how is it being advocated? ICSAN should take up the challenge and prove to the world that it is, in deed and in truth, the corporate governance professionals.
