The International Finance Corporation (IFC), a global development institution focused on the private sector in emerging markets and a member of World Bank Group, together with the Securities and Exchange Commission of Nigeria, are helping to strengthen market integrity with a standardized Corporate Governance scorecard for public companies. The scorecard will identify strong performers through enhanced disclosure, strengthen investor confidence and encourage foreign investments in the country.
In 2014 IFC and SEC partnered to develop the Nigerian Corporate Governance Scorecard which was launched in November 2015. Following the launch, both institutions have jointly trained various stakeholders to prepare for implementation. These stakeholders include Chief Finance Officers, Company Secretaries, Audit Committee and Board Chairpersons. The training sessions generated awareness for the new disclosure requirements of SEC. These disclosures will be used annually to assess corporate governance practices of listed companies in the country.
Corporate governance scorecards are quantitative tools used to measure the level of observance of a code or standard of corporate governance. The scorecard was developed using indicators from the SEC code of corporate governance and will assess individual, sectorial and market-wide level of compliance with standards of best practices.
Mounir Gwarzo, Director General, Securities and Exchange Commission, said, “A key focus of the SEC is to provide regulatory oversight to ensure public companies comply with best practices in corporate governance and boost their performance. Having built considerable market awareness for the scorecard with IFC’s support, we hope that as companies comply, they will improve their performance and contribute to growth in the nation’s economy.”
Eme Essien Lore, IFC Country Manager for Nigeria, said, “IFC works with firms to attract and retain investment by promoting the adoption of good corporate governance practices and standards. We have partnered with SEC over the last two years, developing the CG Scorecard and sensitizing stakeholders. We hope that as implementation begins in January 2017, the trained officials would translate progress made into ongoing processes that boost performance, attract investments and help the economy grow.”
Corporate governance refers to the structures and processes by which companies are directed and controlled. Companies become more accountable and transparent to investors, which encourages new investments, boosts economic growth, and provides employment opportunities.
IFC’s Africa Corporate Governance program is funded by the State Secretariat for Economic Affairs (SECO), Switzerland. IFC is the implementing partner for the program.