ONE year after the National Code of Corporate Governance was suspended, the Board of the Financial Reporting Council (FRC) of Nigeria has inaugurated a technical committee to review and re-issue the national code.
The committee comprises of representatives from : the Central Bank of Nigeria (CBN), Corporate Affairs Commission(CAC), KPMG, Pension Commission (PENCOM), National Insurance Commission (NAICOM), Nigerian Stock Exchange among others.
Speaking at the inauguration of the committee in Lagos, the Chairman, the Governing Board of the FRC, Mr Adedotun Sulaiman, said the review of the code is to address several issues that arose from the previous code released in October 2016.
The committee he said is expected to come up with a National Code for corporates that is aligned with sectoral codes before the end of the first quarter of 2018.
The major difference that will be seen in the new code from the previous code he said, would be the active involvement of stakeholders in the formulation, as well as the consideration of the peculiarities of the local business terrain in relation to global best practises.
“We will seize the opportunity of the impending exercise to harmonise and streamline the various sectoral codes on corporate governance currently in existence in the country.
“While the absence of a National Code of Corporate Governance provided the vacuum which industry regulators sought to fill within their respective spheres of regulatory purview, we will use the introduction of a revised national code to provide a fulcrum around which different industry or sector regulators can align their efforts to introduce, promote and entrench high standards of corporate governance practices in their respective sectors,” he stated.
Sulaiman, further said the board expects the draft code for corporates to be out before the end of the first quarter while the code for public sector and non-profit organisations are expected to follow. All these are aimed at completion and reissuance of the new code this year.
According to him, the code for corporates takes precedence because of the impact it is expected to have on the economy of the country. Also to be considered, he said is the conflicts between the sectoral and national code.
For example, Banks and other Financial Institutions Act (BOFIA) is an Act to regulate banking and other financial institutions and for matters connected therewith. Conflicts arising from this code will be resolved.
He added that the decision on which code should take precedence will be arrived at by the committee as well as if the code should be mandatory, prescriptive or complicity or explainatory.
In his acceptance speech, the chairman of the newly-inaugurated committee, Mr Muhammad Ahmad, noted that corporate governance built on transparency, accountability and trust plays a significant role in attracting foreign investment and shaping societies.
He also stressed the need for extensive consultation with stakeholders calling for support, commitment and contribution of all concerned in the review of the code.
Ahmad, said the review will focus on sectors that contribute largely to the economy.
Also speaking at the inauguration, a member of the technical committee, and Assistant General manager at the National Pension Commission, Mr Abdulrahman Saleem, said the committee will aside other things focus on resolving conflicts and addressing contradictions which according to him marred the suspended code.
On his part, Prof Chris Ogbechie, of the Lagos Business School, another member of the committee stated that “stakeholder engagement is critical” adding that the revised code that will be released will be one that promotes sustainability in the Nigerian economy.
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