NIGERIAN CODE OF CORPORATE GOVERNANCE

The Federal Reporting Council (FRC) has recently published a New Code of Corporate Governance pursuant to its powers under sections 11c and 15c of the financial reporting council of Nigeria Act (FRCN) 2011. The code seeks to institutionalize and encourage better corporate governance practice in Nigeria companies. The code is awareness of essential corporate values and ethical practice that will advance the integrity of the business environment. Objectives of Nigerian code corporate governance The federal reporting council (frc) in 2016 released three draft codes of corporate governance for private companies, public companies and not-for profit entities. The codes were suspended as a result of controversies relating to its legality and impact on the ease of doing business objective of the federal government of Nigeria (fgn). In a bid to redeveloped a national corporate governance code which will be in consonance with the ease of doing business objective of the FGN and international best practices, the FRC has made consultations with stakeholders and subsequently drafted a new code that consolidates the codes for private and public companies while the code for Not-for profit entities remains suspended. The code is divided into 6 parts and contains 28 principles each with practices recommended for their implementation. The key Governance pillars provided for in the code are as follows: • Board of directors and officers of the board • Business conduct and ethics • Assurance • Sustainability • Relationship with shareholders • Transparency How will the code be enforced and implemented The implementation of the code will be monitored by the FRC throught the sectoral regulations and registered exchanges who are empowered to impose appropriate sanctions based on the specific deviation noted and the company in question. Conclusion It is no doubt that good Corporate Governance is largely as a result of sound internal monitoring system, an effective regulatory environment, accountability, transparency and adequate disclosure requirement. The practices recommended in the code will require companies to conduct a prelimary evaluation of their existing governance practices in line with the principles enunciated in the code and put in place appropriate processes and practices to address any observed deviation.