‘Public sector must adopt corporate governance code for desired improvement’
President, Institute of Chartered Secretaries and Administrators of Nigeria (ICSAN), Bode Ayeku, in this interview with Gloria Nwafor, spoke on why corporate governance should be entrenched in the public sector, why active participation by the citizenry is critical for economic development, and the Institute’s position to address industrial crisis in the nation’s tertiary institutions. Excerpts:
Why is the public sector yet to adopt the corporate governance code as discussions are focused only on the private sector?
THE focus of the Institute is that it should be corporate and public governance administration. We are looking at both sectors so that at the end of the day, we can have the desired improvement. At the end of the day, we should be regulated by the same rules, irrespective of which sector you belong, either the private or public sector. That is why it is interesting and important for the institute to continue to embark on this advocacy to let all stakeholders, whether in the public or private sector know that we must be part of this particular initiative by participating actively. It will be something of interest to the institute and the institute is willing to partner with the government, in such a way that we also have a code of governance for the public sector because the private sector exists to complement what the public sector is doing.
So, it is better that those sectors are regulated by the same principles, in terms of best practices, so that we can actually move very fast. If you look at when we started the Nigerian Code of Corporate Governance (NCCG) in 2018, the idea then was to have a code that applied to the private sector and the public sector. There were public hearings and I participated in all the public hearings between 2015 and 2018. We were unanimous that there must be a code for corporate governance.
However, the major challenge then was that most of these public institutions were established by Acts of parliament and those Acts of Parliament had given them clear guidelines as to how they should do things, who should be in charge of each organisation. And for them now to key into this code of governance proposed for the public sector, it would require that they should amend some of the provisions in their enabling Act. The challenge then was that-would that be possible so soon? Because some of the agencies also attended the public hearing to say these are the provisions we have in our enabling Act.
How are you encouraging the public sector to imbibe best practices?
The public sector is conscious of the fact that there is a need for change. Now that the FRC is through with NCCG for those in the private sector the next assignment is to amend those provisions that could create bottlenecks along the line so that they key into it. It is important so that the public sector would know their obligations and then would be in the position to have this beneficial relationship between the public and the private sector. This is the best practice that is an idea for a country.
How relevant is corporate governance structure to organisations?
Corporate governance has come to stay, and that is why the obligation is given to a company secretary, a chartered secretary to ensure that things are done properly and even advise the board. The board basically appoints the company secretary, but in this case, the person now appointed is the one to advise the company and the board on issues relating to ethics, conflict of interest and corporate governance. That shows there is a shift in the role or assignment given to the company secretary and that is why most of our sister institutes worldwide have decided to not only communicate this change to company secretaries and stakeholders, in terms of what they are expected to do but also to let them carry that name so that they know the way to that responsibility and discharge that responsibility credibly. That is why we have countries like the UK, Canada, Australia, Brazil, they have changed, and several other institutes and it is a matter of time. We are also a member of the Corporate Secretaries International Association, which is the global body of all chartered secretary bodies worldwide. If you were a company secretary 30 years ago, the role you play now as a company secretary is a minimum of times 500 of what you were doing before because things are changing. Now, you are to initiate practices that are in line with best practices. You must compare with other developed climes and see what they are doing and try to see whether we can have the economy or society that we deserve.
Insecurity has been a source of concern in the country. What is your advice to the present administration to tackle the high spate of insecurity and other social vices in the country?
The good thing about insecurity in Nigeria is there is no longer a dispute about it. That means the problem is half solved. Everybody knows there is an increase in the spate of insecurity that is why all discussions are centred on insecurity. Without security, economic development will be an illusion. People must be secured for them to do what they need to do. That is why we need to take a few urgent steps. We need to ask ourselves some questions such as: Why is it that these things are now assuming a new dimension? Or is it that we do not have enough personnel to put a stop to insecurity? Or we are not sufficiently equipped to confront them? If we are able to identify some of these problems we would be able to solve them. If there is a need for us to recruit more people or to acquire the latest equipment to confront these terrorists, the government should do that. In addition, if there is a need to call for foreign assistance, the government should not hesitate to do that urgently. We just need to get involved, as security is the responsibility of everyone. We should not wait for the government alone; we should be conscious of our environment and be conscious of the economy. We need to be involved, that is the only way we can stop this problem. Insecurity requires the attention of the government and the cooperation of the citizen.
Is the institute involved in offering assistance to the NUC to address the industrial crisis in the nation’s tertiary institutions?
It is about time the National University (NUC) extended its hand to stakeholders in the private sector in the training of its personnel on corporate governance to minimise disputes and industrial crises that have become a norm in universities. We can help universities resolve crises. We can help NUC set up a template peculiar to university administration alone and in line with how things are done globally.
Once a template is set up, it would be followed by a monitoring committee whose reports would be published regularly as a means of putting the nation’s universities on their toes in terms of performance. We are opened to any training initiatives to any sector both private and public. I know last year, there was this initiative to have a code of best practices in the universities. It was being initiated by NUC. We have made known our interest to partner with them in terms of structures that we expect to deliver as regards corporate governance in the university system. We are also in a position to train our future leaders in what they are expected to do. It is a work in progress and I think what will be required in terms of our education system is to have a more robust check on best practices that should be imbibed by universities. There have been issues bordering on which section in the university has the power to do what? I think it’s just that that particular process should be put in place and the regulatory agencies will be in a better position to do that.
For example, why do we have sanity in banks? It is because the regulatory agency has put in a code to guide every activity in banks. The NUC should continue with that initiative but should be made broader in terms of involvement with relevant stakeholders to actually come up with the code of best practices in our university, which will be uniformly applied across private and public universities. We expect NUC to be carrying out monthly evaluation and have a monitoring committee that should not be made up of only NUC members but attract other relevant stakeholders- people from the private sector and other countries. I believe one of the ways by which we can solve our problems (in universities) is to compare what is happening in other climes to that of Nigeria. Most importantly, the findings of this committee should be made public. The advantage of this is that all institutions will be afraid of scandal and therefore learn to do things right. Let’s assume after the evaluation report, NUC publishes the scandal in certain universities, parents would be well educated as regards which university would they send their children to. That alone is sufficient reward for the poor standard of such university because lots of parents would gradually shift their attention away from that university. Patronage would improve or decrease because Nigerians would have a better perception of universities that are faring well in terms of global best practice.
There are plans by the institute to change its name. What is the reason behind this?
The proposal to change our name is not something that is local and that is the global trend. If you look at most of our sister institutes worldwide, they are moving away in order to capture the current trend. Five decades ago when you mention chartered secretaries, the challenge was basically limited to secretaries of companies, secretaries of public organisations, and also the impression was that they were just to take the minutes. However, if you look at the emerging trend, starting from the 90s when we started having the code of corporate governance, and you have seen that the rules of chartered secretaries have changed dramatically. It has changed from the role of being governance professionals. They have now seen as those to chart the course for compliance and best practices in their organisations. We are not doing something that is extraordinary
How would you assess the public sector in terms of accountability and disclosure of public funds?
There is room for improvement. Some years ago, they started publishing allocations to states and local governments. It is a form of disclosure. And that is why the responsibility of the leaders do ask their local governments – how have you spent this money? So that goes to the need for us to ask the right question. In the past it was not like that, you won’t even know how much a state is given or a local government. Apart from that, you also communicate the project, the amount, and the location. If they say they have completed it, they also do commissioning (inauguration). So do we now put up the relevant questions on this project, has it been done, or this thing commissioned had not been completed? I think that is an area we need to also assist the government. When you draw their attention to certain things, you will observe that they make amendments. So as much as possible, they have started doing something in terms of disclosure, and accountability.
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