Adibe Emenyonu
6 November 2009
Benin — Lack of interest in the management of public quoted companies by shareholders and poor corporate governance have been attributed to the failures experienced by most public liability companies.
This was as the House of Representatives Committee on Capital market yesterday denied knowledge of the existence of a bill sent by the Nigerian Stock Exchange (NSE) to the National Assembly, seeking the recognition of a print-out from the Central Securities and Clearing System (CSCS) as evidence of shareholding in listed companies.
Assistant Director, Securities and Exchange Commission [SEC], Mr. Andrew Tenmang, made this assertion yesterday during the Stakeholder' Enlightenment Workshop on Recent Developments in the Capital Market held in Benin, Edo State.
Tenmang, who delivered a paper titled: The Role of Shareholder Associations in Enforcing Good Corporate Governance in Companies, said most Nigerian individual shareholders do not understand their rights and responsibilities and where they do, they appear to be somewhat complacent.
He said recent happenings across the globe (Eron, Worldcom, Pamalet, and back home in Cadbury) have shown that poor corporate governance can quickly lead to corporate failures, loss of investments, diminished investment value and confidence.
"Most of the recent high profile failure resulted from corporate governance, risk management and internal control weaknesses, and this strengthens the call for shareholders to take more interest in how their companies are governed," he said.
Speaking during a visit to the NSE as part of its oversight functions, the Chairman of the committee, Mr. Aliyu Wadada, said bill must have been sent through the wrong channel. "The bill is part of efforts to dematerialise share certificates, which is the conversion of shares certificate from physical to electronic form," Wadada said: "This committee is not aware of any bill seeking to give legal backing to the dematerialisation exercise. We are not aware of any bill in that regard whether in the chamber or around it. It might be in the Senate, but we are not aware, not even any of my colleagues."
Speaking on measures taken to restore confidence in the capital market, Director, Special Duties [SEC], Sylvester Akele, cited the Presidential Advisory Team on the Nigerian capital Market,that was set August 2008.
He said that,the office of the Attorney General of the Federation was directed to issue an exemption to the provisions of the relevant sections on the Companies and Allied Matters Act, 1990 on share buy-backs to permit quoted companies to buy back up to 20 per cent of their shares.
However, he said that SEC approval is required before any quoted company is allowed to undertake any share buy-back.
Akele who spoke on îThe State of Nigerian Capital Marketî noted that the SEC, Nigeria Stock Exchange (NSE) and all capital market operators equally reduced their fees by 50 per cent as part of efforts to attract patronage.
Also speaking, the Zonal Head, Onitsha Zonal Office, SEC, Mr. Eric Elujekor, said that the increased activities in the corporate sector resulting from the growing awareness of the utility of investing in corporate securities has brought with it conflicts in corporate administration.
Be the first to Write a Comment!
Copyright © 2009 This Day. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.
AllAfrica aggregates and indexes content from over 125 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.
