Corporate Law
8/21/2008 12:39:36 PM EST
Emerging Corporate Governance Trends in Nigeria
Corporate Commercial Attorneys, Detail Solicitors, Lagos, Nigeria
Corporate governance is a set of processes, rules, and policies affecting the way a corporation is directed or controlled. Sound governance principles are the foundation upon which investors confidence is built. Corporate governance practices have recently assumed front burner dimensions in Nigeria. Dolapo Kukoyi and Ugochukwu Ndubisiof Detail Solicitors, Lagos, Nigeria highlight the emerging trends in corporate governance in Nigeria.
The authors write: Several reasons can be adduced for the emergence of corporate governance trends in Nigeria; prominent among them are:
- The increased public ownership of companies, which plays out visibly in the banking industry (the 2005 bank consolidation exercise set the stage for several initial public offers in which the investing public acquired shares of banks; consequently, proper appropriation of investors funds has become standard practice for bank executives, as the investing public watches closely how bank finances are managed);
- The current government stance on anti-corruption and rule of law;
- The renaissance of judicial activism by Nigerian courts as demonstrated by their recent decisions in various spheres, for example, the shock waves created by the election petitions judgments.
The consequences of these catalysts of change are manifold. A highlighted example is the flurry of class actions recently experienced in the country: Cadbury Nigeria Plcs shareholders sued the company for loss suffered due to account overstatement and negligence; First Bank Plcs share subscribers brought an action for damages after their money was held over because the public offer was oversubscribed; and, not to forget, the State Governments claim against British American Tobacco for health bills incurred by the State Governments due to tobacco induced ailments.
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