The Financial Reporting Council of Nigeria (FRCN) has said it is working on ways to develop a code to regulate the corporate governance regime in Nigeria.
Chairman of the council, Mr. Dotun Suleiman, who spoke at the maiden edition of Alliance Law Firm Lecture Series and book presentation with the theme, “Contemporary Corporate Governance Issues in Nigeria”, said the council was already working on a code.
The book, titled “Class Action in Nigeria” was written by the managing partner of the firm, Mr. Uche Val Obi (SAN).
According to Suleiman, the code will regulate corporate governance, but will not replace existing regulatory laws.
“It is going to be a principle-based friendly code which will first be in a draft and we will continue to have public discourse and eventually become fully public in due course,” he declared
The code, Sulaimo said, would create 28 corporate governance principles with about 200 recommended practices, which would give effect to the principles.
Also speaking, a professor of law, Fabian Ajogwu (SAN) identified a set of principles, which must be scrupulously implemented and practiced for corporate governance to thrive in the country.
He said corporate organizations should uphold their fiduciary duties in corporate governance in a bid to foster healthy business environment.
According to him, corporate governance imposes a serious responsibility on an individual by an entity to act on its behalf with utmost trust and faith.
His words: “When you talk of corporate governance, I always like to approach this topic by giving illustration of two things — ownership and duty.
“First in my definition, I will like to see ownership as typified by the right to destroy a thing; anything you can lawfully destroy belongs to you.
“So, if I burn my jacket, there is nothing you can do about it because it is lawfully mine. However, if I engage some of you in this room to dry clean and iron that jacket or do anything in relation to it, then the first thing I loose is the right to destroy that suit without consulting the owner.
“This is what happens when you are in a private placement and then go into public placement, you cease to be the owner of that public entity, and at best, you can only become a fractionalised owner of its shares.”
Ajogwu said the scenarios clearly depict the idea of corporate governance in Nigeria, adding that since most entrepreneurs were unable to deal with this reality, it had interfered largely with their fiduciary duties, which forms the thrust of the scheme.
He stressed that whenever “you find an individual or entity which is incapable of a function, such individual or entity is largely dependent on a set of people or officers called directors who ensure success in their duties.”
According to him, the practice of corporate governance in Nigeria is already embedded in the Companies and Allied Matters Act.
Dignitaries at the event include a Supreme Court judge, Justice Ejembi Eko, who represented the Chief Justice of the Federation, Justice Walter Onnoghen and the Director, Lagos Business School, Prof. Pat Utomi and senior