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SEC urges shareholders to focus on long term investment

By on November 23, 2014

A Director and Secretary to the Securities and Exchange Commission (SEC), Mr. Edosa Aigbekaen has urged investors to pay more attention to long term investment in the Nigerian capital market so that companies can grow and create better value.
He made this known yesterday while presenting a paper on corporate governance framework in Nigeria at SEC’s workshop for journalists in Abuja
He said shareholders should take more interest in sustainable returns and longer term performance and to be more active on corporate governance issues.
He noted that some people believe that investment in stocks is all about dividend and bonus stressing that investors should be long term focused.
Aigbekaen said, the 2008 market crash brought to the fore, issues of corporate governance in Nigerian corporate world.
He said stakeholders and regulators in the Nigerian financial system have since then made significant efforts to promote good corporate governance practices in the public companies.
He confirmed that, the framework for corporate governance differs from jurisdiction to jurisdiction.
According to him, “the focus of all frameworks is to ensure the integrity and stability of the financial system. While the framework in Nigeria is regulatory-driven, it is important for shareholders in Nigeria to have meaningful engagement with companies and hold the management to account for its performance.”
He affirmed that, a good governance framework can play an important role in helping boards gain a better understanding of their oversight role.
“While some institutional investors are known to demand good corporate practices from the managers of their companies, a lot more is expected of the majority of small holders who are known to be very passive. The shareholders association should be more responsive to ensuring accountability and effective management of their company”, he said.
Meanwhile, investors’ appetite waned further yesterday as the benchmark index declined by 2.10 per cent  to close at 33,428.76 points from 34,145.79 attained the previous day. Market capitalisation also decreased to 11.08 trillion from 11.31 trillion the previous trading day.
Trading activities on the Nigerian stock exchange increased by 16.49 per cent as investors bought 312.45 million shares worth N4.12 billion, in 4,421.00 deals, compared to 268.22 million shares worth N3.35 billion, in 3,962.00 deals exchanged on Wednesday.

 

[ThisDay]