Technology Times Editors dig up this May 30, 2014 report that is relevant today as it was back then:
The Federal Government has ordered that the positions of Chairman of Board of Directors and that of Chief Executive Officers “should be occupied by two separate individuals” under a newly-introduced code of corporate governance for telecoms companies in Nigeria.
The telecoms industry watchdog said that the set of new rules was introduced to exert control over the internal running of telecoms companies because of their strategic economic importance to Nigeria.
One of the key highlights of the new Code of Corporate Governance for the Telecommunication Industry introduced by the Nigerian Communications Commission (NCC) comes under Principle 7.0 that asserts “duality” of Chairman and CEO roles in any telecoms company in Nigeria.
According to Principle 7.0 of the Code, “In order to institute and maintain independence and proper checks and balances, the positions of Chairman of the Board of Directors and that of Chief Executive Officer should be occupied by two separate individuals.”
NCC said that it is looking into the internal management and structure of local telecoms companies, particularly its key stakeholders like the Board and Management, because of the crucial roles they play in ensuring the continued growth of their respective businesses.
According to the NCC Code, “The Board is the highest decision-making body, charged by the shareholders in general meeting with responsibility for direction, control and management of the affairs of the company and is the body with primary responsibility for Corporate Governance in the company. While the Board may delegate some of its powers, it remains responsible for the governance of the organisation.”
Under the rule, the Board Chairman, who should be a non-executive director, “should be elected by the Directors from among themselves.”
It further stipulates that the Chairman’s performance “and his ability to continue to add value to the Board should be evaluated annually.”
On the other hand, the CEO of any telecoms company in Nigeria should be appointed by the Board of directors in accordance with the provisions of the Companies and Allied Matters Act 2004.
In apparent recognition of the key role that telecoms services play in the economy, the regulator has also declared that the Board of any telecoms company in Nigeria has the responsibility to ensure “clear and balanced understanding of the company’s external stakeholders as well as their importance to the business of the company.”
In this regard, the Code stipulates that Boards of telecoms companies must implement a framework that recognises the importance of the sector to society such that it “ensures a commitment to providing good quality services to their customers.”
The Code also stipulates that the Board must also ensure “an effective and efficient process for dealing with incidences and/or cases of service failure.”
Eugene Juwah, the Executive Vice Chairman (EVC) of NCC said that the self-governing Code set up by government emanated from a multi-stakeholder group called NCC Corporate Governance Working Group (CGWG).
According to Juwah, “The need to develop a sector specific Corporate Governance Code for the Nigerian Telecommunication Industry is necessary to address the peculiarities of the sector that are not typically dealt with under broadly-aimed Codes.”
The industry watchdog added that, “this is more so in view of the fact that the telecommunications sector though dominated by privately-held companies is of strategic importance to the economy at a macro level, and has considerable impact at the micro level.”
Chief of the telecoms watchdog added that, “Corporate Governance in our emerging economy is driven by the need to develop a system of control which is aimed at increasing share holder value and surpassing the expectations of other stakeholders. This is more so in recognition of the fact that the corporate governance culture adopted by companies have positive or negative impact on their growth and development. It is also a critical deciding factor in the success or failure of the companies.”
The Code of Corporate Governance for the Telecommunications Industry in Nigeria “is a voluntary code of leading practices which aims at regulating corporate behavior and practices of companies within the industry”, according to NCC.
Juwah is hopeful that the Code, “would promote good corporate governance practices in the industry and would create a credible industry which every stakeholder can have confidence in as well as foster the growth and development of the industry and larger national economy.”
According to him, the Nigerian Telecommunications Sector Corporate Governance Working Group (CGWG), which was inaugurated in October 24, 2012, with membership drawn from across the Nigerian telecoms sector, the NCC, Corporate Governance Consultants and Experts, developed the Code for the industry.
Fabian Ajogwu, a Senior Advocate of Nigeria is Chairman of CGWG and other members of the Group include Okechukwu Itanyi, Executive Commissioner of NCC; Funlola Akiode of NCC; Josephine Amuwa of NCC; Chidi Diugwu of NCC; Pankan Eze, Secretary of CGWG NCC; Oyeronke Oyetunde of MTN and Felix Omojola of MTN.
Others include Osondu Nwokoro of Airtel; Shola Adeyemi of Airtel; Ibrahim Dikko of Etisalat; Ikenna Ikeme of Etisalat; Olayinka Olafimihan of Globacom; Tosin Cole of Globacom; Martins Ogbolu of Vodacom and Nkechi Newton-Denila of Vodacom.
Others members include Gbenga Onakomaiya of HIS; Jumole Ademuliyi Ajala of HIS; Bosun Hambolu of Starcomms; Frank Omizu of Starcomms; Nechi Ezeako of CLB Sage and Osaretin Odaro-Oyewumi of CLB Sage.