By Dipo Olowookere
The Steering Board of the Corporate Governance Rating System (CGRS) launched by the duo of Convention on Business Integrity (CBi) and the Nigerian Stock Exchange (NSE) is already reviewing the corporate governance standards of the Diamond Bank and Stanbic IBTC Holdings.
Both firms are listed on the local stock exchange and were recently fined by the Central Bank of Nigeria (CBN) for their role in the alleged illegal repatriation of $8.1 billion by MTN Nigeria Communications Limited.
Four banks were in total fined N5.9 billion for the alleged offence, but the two are the only ones trading their shares on the NSE.
While Diamond Bank was fined N250 million, Stanbic IBTC Bank, a subsidiary of Stanbic IBTC Holdings, was fined N1.88 billion. The banking sector regulator, CBN, has already deducted the money from the respective accounts of the lenders.
Chairman of the CGRS Steering Board, Ms Tinuade Awe, said an engagement process has been launched with Stanbic IBTC Holdings Plc and Diamond Bank Plc on the issue, promising to “inform the investing public on the outcome of its engagement at a future date.”
According to The Nation, Stanbic IBTC Holdings and Diamond Bank were among 35 companies that were awarded CGRS certification in February 2018 and was designed to rate quoted companies and their directors on corporate governance practices.
The CGRS was the underlying variable for the creation of the NSE Corporate Governance Index (NSE CG Index). The NSE CG Index declined by 1.32 per cent yesterday, almost a triple of the overall average decline of 0.48 per cent for the entire equities market.
To be certified, the CGRS rates quoted companies through three processes including independent verification; self – assessment by the company; certification of director awareness of their fiduciary duties; and a corporate integrity assessment where perceptions of actual company behaviour are sought from internal and external stakeholders.
For certification, a score of 70 percent and above is needed for both the company and individual directors.
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