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Compliance with Corporate Governance Code Very Low in Nigeria—SEC

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Compliance with Corporate Governance Code Very Low in Nigeria—SEC

By Dipo Olowookere

Acting Director General of Securities and Exchange Commission (SEC), Ms Mary Uduk, has lamented the low level of compliance with corporate governance code in Nigeria.

Speaking at a function in Lagos on Thursday, the SEC boss said some companies listed on the Nigerian Stock Exchange (NSE) lacked understanding of the SEC Code 2011, which talked about code of corporate governance for public companies in the country.

According to SEC Code 2011, the rules were not intended to be rigid, but to “be viewed and understood as a guide to facilitate sound corporate practices and behaviour.”

The code stipulated that the Board is accountable and responsible for the performance and affairs of the company and should define its strategic goals and ensure that its human and financial resources are effectively deployed towards attaining those goals.

Also, the board was mandated to ensure that the company was properly managed, overseeing the effective performance of the management in order to protect and enhance shareholder value and to meet the company’s obligations to its employees and other stakeholders.

But Ms Uduk said some boards were not performing these and other roles expected of them by the corporate governance code.

“We observed that most of the issues covered in the SEC Code 2011 have remained difficult for some entities to observe in terms of fairness, independence, accountability and transparency requirements by their boards.

“The Code of corporate governance talks about how companies are run and managed.

“Looking at the scorecard as a follow up to the code, we have been able to see areas of weaknesses and strength across companies and these areas are very germane to having strong corporate governance.

“For example, the Boards are expected to have a deep understanding of the business and the environment to which the business is run.

“They are supposed to understand the blueprint, they are supposed to speak out, they are supposed to be innovative and they are supposed to have a little bit of financial experience so they could be able to interpret financial statements,” Ms Uduk said at the Alliance Law Firm’s Maiden Lecture Series, Luncheon and Book Presentation.

At the lecture themed ‘Contemporary Corporate Governance Issues in Nigeria,’ the SEC DG, who was represented by a Director at the agency, Mr Edward Okolo, pointed out that access to critical indices by which companies’ compliance with the SEC Code could be measured remained difficult.

She stressed that experiences globally have demonstrated that enterprises with commitment to corporate governance principles perform better and have continued to enjoy investors and other stakeholders’ confidence in building their brands.

Ms Uduk urged publicly listed companies to do more to strengthen their boards so as to have better corporate governance system.

Business Post reports that the SEC Code 2011 stipulates that The CEO/MD should be knowledgeable in relevant areas of the company’s activities. He should demonstrate industry, credibility and integrity and should have the confidence of the Board and management.

Also, executive directors should be involved in the day-to-day operations and management of the company. In particular, they should be responsible for the departments they head and should be answerable to the Board through the CEO/MD.

Furthermore, non-executive directors are expected to be key members of the Board. They should bring independent judgment as well as necessary scrutiny to the proposals and actions of the management and executive directors especially on issues of strategy, performance evaluation and key appointments.

For independent directors, they should have no significant contractual relationship with the company or group and must be free from any business or other relationship which could materially interfere with their capacity to act in an independent manner and “every public company should have a minimum of one independent director on its Board.”

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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Economy

Buhari Orders Kyari to Incorporate NNPC, Ararume to Chair Board

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NNPC profit 44 years

By Aduragbemi Omiyale

President Muhammadu Buhari has directed the incorporation of the Nigerian National Petroleum Company Limited, a statement from the presidency on Sunday confirm.

The Group Managing Director (GMD) of NNPC, Mr Mele Kyari, was asked to see to the success of this directive, the Special Adviser to the President on Media and Publicity, Mr Femi Adesina, disclosed in the statement issued today.

The President’s spokesman said this order was given by Mr Buhari in his capacity as the Minister of Petroleum Resources “in consonance with Section 53(1) of the Petroleum Industry Act 2021, which requires the Minister of Petroleum Resources to cause for the incorporation of the NNPC Limited within six months of commencement of the Act in consultation with the Minister of Finance on the nominal shares of the company.”

The NNPC chief was, therefore, given the mandate to “take necessary steps to ensure that the incorporation of the NNPC Limited is consistent with the provisions of the PIA 2021.”

A few weeks ago, the President signed the PIA, giving room for the state-owned oil agency to become a commercial organisation under the Companies and Allied Matters Act (CAMA) 2020.

Before now, the NNPC was operating as a government agency and was solely responsible for the importation of petrol into the country.

But as a part of efforts to make the oil industry more attractive to investors, the government made the sector more transparent by signing the PIA into law.

In the statement issued today, Mr Adesina said President Buhari, by the power also vested in him under Section 59(2) of the PIA 2021, has approved the appointment of the board and management of the NNPC Limited, with effect from the date of incorporation of the company.

It was disclosed that Mr Ifeanyi Ararume was selected as the chairman of the board, while Mr Kyari and Umar Ajiya are to serve as the Chief Executive Officer and Chief Financial Officer, respectively.

“Other board members are Dr Tajudeen Umar (North East), Mrs Lami O. Ahmed (North Central), Mallam Mohammed Lawal (North West), Senator Margaret Chuba Okadigbo (South East), Barrister Constance Harry Marshal (South South), and Chief Pius Akinyelure (South West),” the statement said.

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Economy

Interswitch Recruits More Quickteller Paypoint Agents

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Quickteller Paypoint agents

By Modupe Gbadeyanka

More Quickteller Paypoint agents have been recruited in a recent market activation drive targeted at cities across Nigeria to grow the nation’s economy and deepen financial inclusion.

The new agents will be gainfully engaged and empowered to generate income, provide financial services and grow to empower others subsequently.

This is under the Interswitch Financial Inclusion Services (IFIS) and the agent will offer the company’s services in Agege, Alimosho, Ikorodu and Ajah, with some areas in Abuja expected to be reached next week.

They will be expected to easily carry out regular financial transactions such as bill payment, funds transfer, cash deposits, cash withdrawals, account opening, insurance and airtime recharge etc.

“Quickteller Paypoint is designed to empower Nigerians by creating income-generating opportunities for unemployed Nigerians and increase streams of income for employed Nigerians thereby facilitating business in both the rural and urban parts of Nigeria,” the Group Head, Growth Marketing, Merchant and Ecosystem at Interswitch, Mr Olawale Akanbi, stated.

“This activation by Quickteller Paypoint is looking to onboard new agents on the Quickteller Paypoint platform.

“By so doing, we are not only empowering Nigerians to earn income, but we are also providing them a platform with which they are able to provide meaningful services to their communities and eventually grow to employ and empower others,” he added.

The recruited agents and other potential agents are onboarded by registering on the Quickteller Paypoint platform. Required documentations include; passport photograph, recent utility bill (electricity, waste or water bill) that shows the location, a valid ID card (National ID, Voter’s card, driver’s license or international passport) and business registration documents (if the business name is CAC registered).

After registration, the agent is required to fund his/her wallet with at least N1000, this qualifies him/her for a free android POS and starter kit. The starter kit contains free visibility banner, power bank and daily journal to document transactions.

In addition, Quickteller agents enjoy competitive commissions and stimulating incentives such as travel opportunities, trainings, business support etc. helping them grow and scale their businesses faster.

Quickteller Paypoint platform is a service of Interswitch Group enabled to support the financial inclusion agenda of the federal government. Currently, Quickteller Paypoint has over 35,000 agents spread across the country.

Quickteller Paypoint is the trade name for Interswitch Financial Inclusion Services (IFIS) Agent locations. It is a one-stop-shop robust consumer service platform for convenient airtime recharge, funds transfer and bill payment.

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Economy

AbokiFX Suspends Parallel Market Exchange Rate Updates

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AbokiFX Suspends

By Dipo Olowookere

The popular website that tracks the exchange rate of the Naira to the major foreign currencies, AbokiFX, has announced the suspension of its updates pending when it gets a “better clarity” of the allegation of FX manipulations levelled against it by the Central Bank of Nigeria (CBN).

Governor of the CBN, Mr Godwin Emefiele, had insinuated on Friday that the platform was responsible for the recent fall of the local currency at the parallel market.

Mr Emefiele said it had been monitoring activities of the website for the past two years, alleging that its owner, Mr Oniwinde Olusegun Adedotun, was trading forex and manipulating figures to cause panic in the financial system, vowing to ensure he is prosecuted.

But in a statement issued on Friday, the platform said, “We do not trade FX neither (sic) do we have the power to manipulate the rates as we DO NOT CREATE the rates.”

It stressed that, “We ONLY publish what we source on the streets of Lagos, hence the phrase, Lagos Parallel Rates.”

AbokiFX explained that, “The rates sourced are carefully collated, reviewed and a mean rate is published from the data pool. This explains our three daily updates – * Morning, ** Midday, ***Evening.”

“Sometimes, rates come in late but we have to wait for the full set of rates before they are published, to prevent volatility of rates,” it further noted in the statement.

The website said, for now, it will not publish the parallel market rates but will keep updating its news and crypto rates sections until further notice.

“We sincerely hope this suspension will lead to the Naira appreciation from next week,” it stated, adding that, “With our decision to temporarily suspend online rate publication, we are aware that there will be limited visibility of parallel rates information, which will impact decision making for many.”

Below is the unedited statement from the firm;

AbokiFX has taken the decision today, the 17th of September 2021, to temporarily suspend rate updates on all our platforms, until we get better clarity of the situation.

Final rates have been posted this evening but the abokiFX news section and the Crypt° rates section will still be active.

WHO WE ARE

abokiFX was established in 2014 as a research and information service company, to conduct market research and gather data on the parallel market rates.

We also wanted to provide some transparency around the parallel market with the availability of information technology.

abokiFX purely provides benchmark parallel rate information which helps guide our users in almost 200 countries across the world.

abokiFX does NOT TRADE FX, which we have always maintained in our emails and social media platforms.

We do not Trade FX neither do we have the power to manipulate the rates as we DO NOT CREATE the rates.

We are the only entity in Nigeria that has a full set of parallel rates, right from our inception in 2014 when the exchange rate was trading at N166 to Sl.

We collated data for years before we started publishing, as we realised the demand increased for our historical data.

To most users of our platforms, we are just a parallel rates board but to many institutions, ranging frorn IVY league universities, to global businesses and research centres, we area keysource of data, especially, historical data (almost a decade’s worth of data on parallel rates).

Companies use our data for their internal and external audits as well as planning and budgeting.

We ONLY publish what we source on the streets of Lagos, hence the phrase, Lagos Parallel Rates. The rates sourced are carefully collated, reviewed and a mean rate is published from the data pool. This explains our three daily updates – * Morning, ** Midday, ***Evening.

Sometimes, rates come in late but we have to wait for the full set of rates before they are published, to prevent volatility of rates.

None of our data source providers know who we are or what their rates are being used for. This is to avoid any manipulation of rates.

Our staff have a daily routine of going to the market to gather rates, as all the BDCs in the country have their rates clearly displayed on their rates board and parallel market rate dealers give the information away freely.

All we do is collate all that information and display it on all our platforms daily.

REPLAY OF 2017 vs 2021

In 2017, Nigeria experienced an FX crises and the Naira depreciated to over N500/$1. abokiFX was accused of manipulating the parallel market rates.

Once liquidity was injected, the Naira appreciated and we published the appreciation which is basically what we do.

2021 has seen a similar scenario with the naira depreciating and we have published what we have been given, which has led some to believe we are manipulating the market. Yet no one can complain about our rates deviating +/- 2% from the parallel market rates when they patronise the dealers in the rnarket.

If we do not create the rates, how then can we control the rates. Our only sources of income have been our API and advert sales.

ALLEGATIONS AGAINST OUR DIRECTOR

All allegations against our director are yet to be confirrned but we at abokiFX DO NOT trade FX neither do we manipulate parallel rnarket rates.

Outside the media allegation, we have not received any communication from any government body and our accounts are not closed as stipulated in the media.

WAY FORWARD

abokiFX is fully functional BUT we will not be publishing any form of rates on our platforms for now. We sincerely hope this suspension will lead to the Naira appreciation from next week. With our decision to temporarily suspend online rate publication, we are aware that there will be limited visibility of parallel rates information which will impact decision making for rnany.

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