By Oluwatobi Opusunju
To thicken the value of Nigeria’s telecom investment valued at over $68 billion, telecom regulator, the Nigerian Communications Commission (NCC), will be penalizing telcos who fail to adhere to the Code of Corporate Governance. The regulator says adherence would no longer be voluntary but mandatory as it seeks to ensure corporate discipline in an industry where recent management and financial rascality has jeopardized investors and consumers’ interests.
“We are committed to raising the standards of leadership and management in the telecom sector,” said Professor Umar Danbatta, the Executive Vice Chairman of NCC, while speaking in Lagos during the Stakeholders Sensitization Workshop on the provisions of the Code. Danbatta said telecommunication has become a strategic part of all other sectors therefore it has become imperative to “raise the standards of leadership and management in the sector to sustain the sector’s role as a driver of economic growth.”
Also while leading a panel at the sensitization workshop, the NCC’s Executive Commissioner, Stakeholders Management, Mr. Sunday Dare said: “At NCC, we are insisting and putting down our foot that the Code of Corporate Governance, which has to do with standard, transparency, accountability and the general internal affairs of the company is important to us. And this must be done in line with best practices.”
The Code of Corporate Governance was introduced by NCC in 2014 as a way to foster good corporate governance practices in the Nigerian telecommunications industry. The code is deemed strategic to instilling stakeholders’ confidence in the sector with its rising contribution to the country’s GDP as oil dips in global value.
Adherence has become imperative “if we consider the ongoing crises in Etisalat now 9Mobile which all had to do with corporate governance as it concerns finance and management,” said one senior NCC official to IT Edge News. It took the intervention of the NCC and the Central Bank of Nigeria to stave off a takeover bid by a consortium of 13 banks after 9Mobile (then Etisalat Nigeria) failed to meet its loan obligations.
Teniola considered the code essential to maintaining stability and growth in the industry but said the regulator must ensure operators and other stakeholders are taken along.
A contentious part of the Code is that the ‘offices of Chairman and that of the CEO shall not be occupied by one person concurrently in any telecom company in Nigeria. In addition, no one can serve as a director in any telecom company for more than 15 years.’ While some stakeholders have argued that this would mean interference in the ownership and management structure of private companies, others deemed it appropriate as is now the case in the banking sector.
The workshop drew participation from stakeholders that include Chairman of NCC Board of Commissioners, Senator Olabiyi Durojaiyei, President of the Association of Telecoms Companies of Nigeria (ATCON), Chairman, Financial Reporting Council, of Nigeria, Mr. Adedotun Sulaiman, Mr. Olusola Teniola; Director, Nigerian Stock Exchange, Mrs. Irene Robinson-Ayanwale, and Chairman, Diamond Bank, Prof. Chris Ogbechie.