SEC to rate companies on corporate governance

Mounir Gwarzo
| credits: http://www.nigeriancurrent.com

The Securities and Exchange Commission has unveiled plans to inaugurate a corporate governance scorecard for companies in the capital market.

According to the commission, the move is aimed at ensuring that the firms uphold international best practices in their operations and perform well.

The Acting Director-General, SEC, Mr. Mounir Gwarzo, was quoted in a statement by the commission as disclosing the plan when he received members of the Centre for Corporate Governance, an organ of the Institute of Directors, in Abuja on Tuesday.

Gwarzo explained that compliance with the tenets of corporate governance would in turn translate into better returns for the companies and better service delivery, among other things.

He added that the plan underscored the importance of corporate governance to the commission.

The acting SEC DG, who hinted that the Corporate Governance Scorecard would be inaugurated in the coming weeks, said the commission was holding consultations with the relevant bodies on the plan.

He said, “Corporate governance is very close to our heart and we believe that collaboration with you will further propagate the advocacy in terms of its importance. I can assure you that we are ready to collaborate with you.”

Gwarzo stressed that if there was any institution in the capital market that should be the champion of corporate governance, it should be the SEC because of its important role as regulator in the Nigerian capital market.

He said it was in recognition of the importance of corporate governance that the commission ensured that operators that had registered with it had compliance officers, no matter how excellent the other officials of the those companies were.

Without the compliance officers, he said companies would not be able to ascertain the level of their compliance with the corporate governance code.

Gwarzo recalled that the intervention of the commission in Ecobank Transnational Incorporated Plc had translated into better management of the bank.

He assured the IoD board members that the commission would to give them all the support they required because SEC Nigeria would benefit a lot from a partnership with the institute, given its role in the Nigerian capital market.

“We have a role to play in the Nigerian capital market to ensure that companies do well. By the time every company and institution imbibes the culture of good corporate governance, it will translate into better returns, better service delivery among others,” Gwarzo said.

The Second Vice-President of the Institute, Alhaji Ahmed Mohammed, had earlier commended SEC for the efforts it made to rescue the Nigerian capital market in the aftermath of the global financial crisis, which also affected Nigeria’s economy.

Mohammed, who is also the Chairman of IoD’s Centre for Corporate Governance, said that although a lot was being done by the SEC, working in unison with the Nigeria Stock Exchange, to sanitise the capital market, a lot more needed to be done — especially in the area of corporate governance.

He said there was the need for a continuous realignment of Nigeria’s business practices to conform to international best practice. He added that it was in that context that the IoD centre of governance was striving to promote good governance by all corporate organisations.