Nigeria: COVID-19 - IoD Tasks Govts On Impact Mitigation for Businesses

31 March 2020

The Institute of Directors (IoD) at the weekend reeled out workable suggestions, including the need for some regulatory framework, on how Nigerian businesses can navigate the growing challenges posed by the lingering coronavirus pandemic to their survival, profitability and growth.

The Director General of the Institute, Mr. Bamidele Alimi, in a statement made available to Daily Trust at the weekend, canvassed some urgent regulatory measures that must be taken by government and business regulatory agencies in order to protect business enterprises from plunging into recession.

The pro corporate governance professional body advocated the need for some regulatory framework that will accommodate and provide for unconventional issues of the modern day business environment, such as health emergency situations that have inherent commercial risks and impacts on businesses and corporate governance obligations.

According to the Institute, this there, therefore, calls for a great need for the government and relevant agencies such as Security & Exchange Commission (SEC), Corporate Affairs Commission (CAC) and the Nigerian Stock Exchange (NSE) to consider reviewing and amending existing regulatory frameworks that are guiding corporate organisations to accommodate and provide for emerging issues arising from Covid-19 and related matters.

Citing experiences in the global economic space where Stock Exchanges have taken a number of steps, including extension of reporting period to file their annual returns statements, in response to the outbreak to protect or support businesses such as the UK and the USA to support its position.

The Institute pointed out that in Nigeria, while companies may want to move to a virtual or hybrid meeting, instead of the conventional AGM, in order to deal with the challenges presented by Covid-19, the lack of facilities and/or capacity, may force them to determine that the better course of action for them is to postpone or adjourn their annual meetings with attendant consequences.

It stated that in order to provide succor for corporate Nigeria therefore, government should consider putting in place a regulatory provision for companies to adopt either virtual-only or hybrid (with both in-person and virtual options) meeting structures to cater to unconventional and emergency situations in the business environment, going forward.

The Institute further clarifies: "Given that companies across the globe are currently considering the manner and speed in which they communicate to shareholders on the perceived risks that they face from the outbreak and the potential impact on their operations and supply chains, as well as the need for a hitch-free filing of records, it becomes important to consider and adopt a new regulatory provision that facilitates uninterrupted meetings, exchange of information and submission/filing of statutory records in times of business environment emergency."

Noting the risks posed by the coronavirus to global economic growth, emerging markets' economic growth, and the Nigerian economic growth in particular, the Institute expressed believe that based on the ongoing efforts made by the federal and state governments and all well-meaning stakeholders, the coronavirus could be contained much sooner.

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