THE Nigerian Communications Commission (NCC) has launched a corporate governance code for operators for the country’s telecoms sector in a bid to drive sustainable growth. The 31-page document, according to the NCC’s Executive Vice Chairman, Dr. Eugene Juwah, has been designed to enhance transparency, accountability, responsibility, integrity and ethical conduct among telecommunications operators, irrespective of their size.
Juwah explained that the code, which is aimed at generating positive growth trajectory in the telecoms sector, defines the roles and responsibilities of stakeholders in the industry. The code provides detailed prescriptions for the Board of Directors, the Board value system, remuneration of staff, performance evaluation, risk management, internal control, reporting, transparency and disclosure agreement among other issues.
Juwah noted that the commission had decided to make the code voluntary for the time being, with a possibility that it might become mandatory in the future depending on the cooperation of the telcos.
Juwah said that following the first stakeholders’ consultation in April 2012, it was decided to have a code in place. “The forum highlighted the absence of a common code to which all telecoms operators in Nigeria should abide. Following this observation,” he said: “To address this gap, NCC inaugurated the Corporate Governance Working Group (CGWG) in October same year. Members were drawn from the operating companies, the NCC and corporate governors”.
He noted that the CGWG focused its activities on providing inputs for the code in areas including identifying corporate governance priorities for the nation’s telecoms sector; agreeing on the target and scope of applicability of the code; considering implementation mechanism of the code’s provisions; conducting stakeholders mapping for the purpose of building on existing international best practices and frameworks provided by the stakeholders management division of the NCC; determining the broad outline of the code; and review and coming out with a workable draft outline as developed.
“While national codes of corporate governance are typically focused on country-specific issues and are aimed at improving and guiding governance codes, sector specific code on the other hand address the specific peculiarities of the affected sectors that are not typically dealt with under national or broadly-aimed codes,” Juwah said.
The Minister of Communications Technology, Dr. Omobola Johnson, represented by a director in the ministry, John Ayodele, commended the NCC for this initiative. She said that the values of the code would help organisations to grow and operate in transparency.
“Transparency is key to corporate governance and it will bring about trust and encourage openness between staff, management staff and owners of organisations. Another principle of Corporate Governance is accountability which makes management staff and owners of companies accountable to stakeholders and staff of the organisation,” Johnson said.
The minister noted that accountability would bring about competitiveness and healthy growth, but that lack of accountability will lead to increased number of porting out of a particular network by telecoms subscribers.
“With the code, NCC has put in place a strong and reliable structure that will drive good governance in the telecommunications sector, and attract investment to the telecoms sector that will boost the national broadband plan of the country,” she stressed.
The CEO of Airtel, Segun Ogunsanya, who spoke on behalf of his colleagues, said that the document would assist telecoms companies in avoiding cases of administrative errors and activities capable of derailing the growth of the sector in Nigeria.
Leaders of industry interest groups including the Chairman of the Association of Telecoms Licensed Operators of Nigeria (ALTON), Gbenga Adebayo, and the President Association of Telecommunications Companies of Nigeria (ATCON), Lanre Ajayi, commended the NCC for making the code a voluntary document for adoption by the operators.
The Director of the Society for Corporate Governance in Nigeria, Dr. Fabian Ajogwu, who delivered a paper, Driving Industry Growth Through Corporate Governance, said there was a need for a code in the telecoms sector, given that the total capitalisation of 12 blue-chip companies operating in Nigeria was less than the total capitalisation of one telecoms operator in Nigeria.
The code will further strengthen growth of the telecoms industry and increase economic development, Ajogwu said, adding that the need for corporate governance code in the telecoms sector will further help to manage conflict of interest, build trust and care among staff of the sector.
He however warned that the interest of company directors must not supersede the company’s interest, and explained that the guidelines to achieve the continued growth of telecoms companies were all captured in the code. He called on all telecoms companies to study the code diligently and make good use of its guiding principles.happy wheels