The Financial Reporting Council has released the National code of corporate governance ending the long wait for the document to guide business operations in the country.
The codes are Code of Corporate Governance for the Private Sector, Code of Governance for Not-for-Profit entities and the code of Governance for the Public Sector.
The one for the private sector and that of the Non-for-Profit entities become effective today October 17 while the FRC will require approval from the presidency for Code of Governance for the Public Sector to be applicable.
According to a statement on the Council’s website, the codes were in line with Section 50 of the Financial Reporting Council of Nigeria Act, 2011.
“In accordance with Section 50 of the Financial Reporting Council of Nigeria Act, 2011, which among other things requires the Directorate of Corporate Governance to develop the principles and practices of Corporate Governance applicable in Nigeria, the council hereby releases the National Code of Corporate Governance effective October 17, 2016.”
The council noted that the code of Corporate Governance for the Private Sector is mandatory while the code of Governance for Not-for-Profit entities is “Comply or Justify non-compliance.”
“The Code of Governance for the Public Sector will not be applicable immediately until an executive directive is secured from the Federal Government of Nigeria.”
“This is due to the fact that the enabling laws that set up most government establishments already carry some form of governance structure that will require an umbrella legislation to unify the different provisions of those laws to synchronise with this code.”
FRC had last June called for stakeholders input into the draft codes on the various categories covered by the statute ahead of its release.
Absence of adequate guidelines guiding business operations in Nigeria has been blamed for the spate of corruption in Nigeria as well as hindrance to genuine foreign investments.