The Manufacturers Association of Nigeria (MAN), the Nigeria Employers Consultative Association (NECA) and the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) otherwise known as the Organised Private Sector (OPS) have thrown their weight behind the Financial Reporting Council of Nigeria (FRC) on the recently released National Code of Corporate Governance (NCCG) but seeks clarifications on certain areas of the code.
The group disclosed this while on a courtesy visit to the Council’s corporate headquarters in Lagos to brainstorm on some sections of the NCCG over the weekend.
Director General of NECA, Mr. Olusegun Oshinowo, who led the delegates, said though, the body was in support of the NCCG which is to ensure transparency, accountability and fairness to all stakeholders in the business sector of the economy, they were in the FRC’s office to seek answers to questions on some sections of the code.
He highlighted some of those grey areas to include among others, transitional time for the enforcement of the code, the number of non-executive directors to be appointed into companies’ board, constitution of Joint Audit by entities with at least N10b capital and appointment of consultants, which he urged the FRC to look into with a view to addressing them in such a way that the inputs of the stakeholders would reflect in the code.
He commended the Council for allowing for robust social dialogue on the NCCG through the series of public hearings and seminars it organized to get inputs from stakeholders before the code was eventually released, adding that to ensure that the code is largely acceptable to all, there was the need for continuous social dialogue and improvements on the code to reflect current realities in the country.
Responding, the Chief Executive Officer of the FRC, Mr. Jim Obazee, said the Council was working tirelessly with stakeholders to ensure the code yields the desired result of entrenching transparency and accountability in the way businesses are done through its emphasis on more disclosures in financial statements in order to build investors’ confidence in the nation’s business environment.
He highlighted some of the giant strides the FRC has made in the past which were hitherto criticized in the beginning but were later commended for achieving the desired results to include among others, adoption of International Financial Reporting Standards (IFRS) as benchmark for stating financial statements in the country and the issuance of FRC Registration Numbers to those who sign entities’ accounts to give credence to the accounts and to ensure that in the event of any misstatements, those individuals can be held responsible through suspension of their numbers instead of the entire organisations they represent.
Obazee, assured them that the areas they have raised issues about would be looked into as the code goes through further restructuring, adding that since the code was not a law, it would not require rigorous process of amendment if there were genuine reasons for it to be rejigged for the general good of the nation’s business environment.
Also, speaking, the Chairman of the Steering Committee on the NCCG, Mr. Victor Odiase, said corporate governance codes world over determine the critical destination of investments.
He decried the high level of business ownership concentration in the country, stressing that,” if we must attract the desired local and foreign investments to move the country’s economy out of recession and make it a vibrant one, there is need for deliberate efforts to deconcentrate entities’ ownership which the corporate governance code focuses on addressing as one of the key areas to attract investors.”
According to Odiase, “Countries with wide dispersal business ownership attract more investors and are more prosperous.” He added that, full implementation of the corporate governance code would make the country a business hub in Africa and beyond, which he said would in turn boost the economy and provide jobs for the teeming unemployed youths, stressing that investors only move their capital to where there is loyalty and guaranteed returns on their investments.
Earlier, the Nigeria Insurers Association (NIA) had visited the FRC to give their backing to the NCCG and also used the medium to highlight those areas they were not in agreement with so as to ensure that they are looked into them with the sole aim of resolving them for the greater good of the nation.