FRCN Highlights Benefits of National Corporate Governance Code

The Financial Reporting Council of Nigeria (FRCN) has declared that its proposed National Corporate Governance Code will serve as the regulatory code in the country from January 1, 2020, when its full implementation commences.

Consequently, the existing code of governance under the laws establishing regulatory bodies such as the Central Bank of Nigeria (CBN), the Securities and Exchange Commission (SEC), among others, would serve as guidelines of operations for public and private businesses.

Executive Secretary of FRCN, Daniel Asapokhai, disclosed this in Kano, during at a public hearing and sensitisation on the new draft copy of the code recently.

However, the Chartered Institute of Bankers in Nigeria (CIBN) and Kano Chambers of Commerce, Mines, Industries and Agriculture (KACIMA) have questioned certain recommendations in the draft copy.

Asapokhai, hinted that when it becomes operational, the corporate governance code would attract local and foreign investments and enhance the integrity of the Nigerian capital market, as well as entrench a culture of transparency and accountability.

He pointed out that the federal government recently set up a 15-member technical committee to review the code due to some defects, which were against international best practices.

He explained that the new draft, which comprised seven parts, 28 principles and 231 recommendations, focuses basically on high financial reporting standards and corporate governance principles in trade and investments.

According to Asapokhai, the committee approached the review of the code with ‘apply and explain principles,’ in order to reduce the cost of doing business in the country, as against the rule-based principle in the 2016 code.

Presenting its position, the Chairman, Kano/Jigawa chapter of CIBN, Aliyu Wada-Nas, suggested clear roles, protection of whistle-blowers and inclusion of young professionals among board members of companies.

An executive of KACCIMA, Aminu Dangana, said although codes were meant to adopt international best practices, he sought a reflection of cultural and level of business enrolments in the final code.

Also, the Chairman, Technical Committee, Muhammad K. Ahmad, argued that the code should apply to all public corporations, whether listed or not, holding companies of public firms and other regulated entities, concessioned and privatised companies, as well as all regulated private concerns.

The public hearing was part of nationwide awareness creation on the new national governance code.