SEC Gets Support on Corporate Governance Code

Stakeholders in the nation’s capital market have thrown their weight behind the new  Code of Corporate Governance  issued by  the Securities and Exchange Commission (SEC) for listed companies, which would become effective on Friday, April 1, 2011.

Speaking   at a meeting on the new code in Lagos,  Chairman of Nestle Nigeria Plc, Chief Olusegun Oshunkeye,  former Chairman of Cadbury Nigeria Plc, Dr. Christopher Kolade,  former  Chairman of Institute of Directors (IOD), Ms. Benedicta  Molokwu, and leading stockbrokers among others, commended the foresight of SEC in reviewing the 2003 Code to meet the current market realities.

Oshunkeye who is  on the board of many companies, was the first to sign the code on behalf of Nestle, saying it has an inbuilt flexibility.

Oshunkeye said, “in particular,  I want to refer to Part A paragraph 12b (of the Code), that those companies seeking to raise funds from the capital market are expected to demonstrate sufficient compliance with the principles and provisions of the code appropriate to their size, circumstances to their operating environment.

That is inbuilt flexibility and user friendly because one size does not fit all.”
In her contribution,  Molokwu  urged SEC to monitor compliance and conformity   with the  code, adding that  there should be  a mechanism through which  companies  would pledge to comply with the  code.

Explaining the rational for the new code, Director-General of SEC, Ms. Arunma Oteh, said that  before 2007 when the financial crisis started,  stakeholders were not convinced of the  need  for  a better code, declaring that as at today,  everybody should be convinced even with the particular challenges Nigerian investors faced recently.

“For us at SEC, it is extremely important that we focus,  as a community of the capital market, on good corporate governance. My inspiration for Nigerian capital market is that we have the highest standard. If we do what a country like Brazil has done, which is through the corporate governance index on their stock exchange, we can have companies aspire to measures of corporate governance of the highest standard in the world. That way, we can attract and retain capital whether from local investors and/or foreign investors”, Oteh said.

Meanwhile trading at the stock market closed positively as gains by Guaranty Trust Bank Plc, Zenith Bank Plc, First Bank of Nigeria Plc and Nigerian Breweries Plc among others reversed the bearish trend.

The Nigerian Stock Exchange (NSE) All-Share Index appreciated by 0.46 per cent to close at 24,754.04, compared with a depreciation of 0.90 per cent the previous day. Investors traded 341.151 million shares worth N3.268 billion in 5,815 deals yesterday up from 152.07 million shares valued at N1.17 billion transacted in 5,081 deals the previous day.

Source : Thisday