1. I N S T I T U T E O F C H A R T E R E D S E C R E T A R I E S A N D
A D M I N I S T R A T O R S O F N I G E R I A ( I C S A N )
M A N D A T O R Y C O N T I N U I N G P R O F E S S I O N A L
E D U C A T I O N ( M C P E )
P R E S E N T E D B Y U T O U K P A N A H F C I S
A U G U S T 3 , 2 0 1 6
Understanding the Financial Reporting Council
(FRC) National Code of Corporate Governance
.

2. Financial Reporting Council
• Established pursuant to the Financial Reporting Council (FRC) Act
2011
Vision:
 To be the conscience of regulatory assurance in financial reporting
and corporate governance in Nigeria
Mission:
 To bring utmost confidence to investors, reputation to oversight and
ensure quality in accounting, auditing, actuarial, valuation and
corporate governance standards and non-financial reporting issues.
2

3. Objects of the Council
The Council’s main objects, as defined in the FRC Act, are to:
 protect investors and other stakeholders interest
 give guidance on issues relating to financial reporting and corporate
governance to professional, institutional and regulatory bodies in Nigeria
 ensure good corporate governance practices in the public and private
sectors of the Nigerian economy
 ensure accuracy and reliability of financial reports and corporate
disclosures, pursuant to the various laws and regulations currently in
existence in Nigeria
 harmonise activities of relevant professional and regulatory bodies as
relating to corporate governance and financial reporting.
 promote the highest standards among auditors and other professionals
engaged in the financial reporting process.
 enhance the credibility of financial reporting; and
 improve the quality of accountancy and audit services, actuarial,
valuation and corporate governance standards.
3

4. Directorates of the Council
 Directorate of Accounting Standards – Private Sector
 Directorate of Accounting Standards – Public Sector
 Directorate of Auditing Practices Standards
 Directorate of Actuarial Standards
 Directorate of Inspection and Monitoring
 Directorate of Valuation Standards
 Directorate of Corporate Governance
4

5. Directorate of Corporate Governance
 Develop principles and practices of corporate governance
 Promote the highest standards of corporate governance and
public awareness of corporate governance principles and
practices
 On behalf of the Council, act as the national coordinating body
responsible for all matters pertaining to corporate governance
 Promote sound financial reporting and accountability based on
true and fair financial statements duly audited by competent
independent auditors
 Encourage sound systems of internal control to safeguard
stakeholders’ investments and assets of Public Interest Entities
 Ensure that the Audit Committees of PIEs keep under review the
scope of the audit, its cost effectiveness, the independence and
objectivity of the Auditors
5

6. Committee on Corporate Governance
The Committee is responsible for:
• Assessing the need for corporate governance in the public and
private sectors
• Organising and promote workshops, seminars and trainings in
corporate governance issues
• Issuing the code of corporate governance and guidelines and
develop a mechanism for periodic assessment of the code and
guidelines
• Providing assistance and guidance in respect of the adoption or
institution of the code in order to fulfil its objectives
• Establishing links with regional and international institutions
engaged in promoting corporate governance
6

7. FRC Codes of Corporate Governance
 Steering Committee chaired by Mr. Victor Odiase inaugurated in
January 2013
 The Terms of Reference of the Committee mirror those of the
Directorate of Corporate Governance
 The Committee developed drafts of the Codes of Corporate Governance
for the Public, Private and Not for Profit Sector
 Respective draft codes reviewed and approved by the FRC Board and
exposure drafts issued thereafter
 Subsequently public hearings and engagements organized by the FRC
7

8. National Code of Corporate Governance for the
Private Sector
8
Consists of 11 Parts:
Part A – Preliminary Matters
Part B – Application of the Code
Part C – Board of Directors
Part D – Risk Management and Audit
Part E – Relations with Shareholders
Part F – Minority Shareholder Protection
Part G –Relations with other Stakeholders
Part H –Transparency
Part I – Code of Business Conduct and Ethics
Part J – Enforcement
Part K – Miscellaneous

9. Part A – Preliminary Matters
9
 Provides background to the Committee’s work
 Sets out the Committee’s Terms of Reference
 Harmonization of identifiable sectoral codes:
 Code of Corporate Governance for Banks in Nigeria Post-Consolidation
2006
 Code of Corporate Governance for Licensed Pensions Operators 2008
 Code of Corporate Governance for Insurance Industry in Nigeria 2009
 SEC Code of Corporate Governance in Nigeria 2011 (acknowledged the
2003 SEC Code)
 Exposure Draft of the Revised Code of Corporate Governance for Banks
in Nigeria 2012 CBN Code of Corporate Governance for Banks and
Discount Houses 2014

10. Part A - Preliminary Matters (contd.)
10
 The Nigerian corporate governance system is predicated on wide
dispersal having adopted unitary board structure in which the
dominant conflicts are between the shareholders and managers.
 The Nigeria investment environment is however replete with
ownership concentration, in which the dominant conflicts are
usually between the controlling shareholders and minorities,
 This has created a mismatch between the country’s ownership
structure and its governance system.
 The Code has governance safeguards that are more country-
specific, contextual and environmentally congruent, while at the
same time conforming to international best practices

11. Part B – Application of the Code
11
The Code of Corporate Governance for the private sector shall be
applicable to the following:
 All public companies (whether listed or not)
 All private companies that are holding companies or subsidiaries
of public companies
 All regulated private companies (RPCs)
 Compliance with the code is mandatory

12. Part C - Board of Directors
12
The main purpose of the board is to provide entrepreneurial,
strategic and ethical leadership to a company. The board shall:
 Exercise leadership, enterprise, integrity and judgment in
directing the company so as to achieve continuing survival
and prosperity of the company
 Every board shall have a Charter setting out its
responsibilities
 Ensure the establishment of a succession plan, appointment,
training and remuneration for both the board and senior
management of the company
 Set the company's values and standards (including ethical
standards)
 be responsible for Information Technology governance.

13. Part C - Board of Directors (contd.)
13
Board Structure and Composition
• Sufficient board size as well as diversity of experience and gender
• Minimum board size of 8 members (except for RPCs that are not
holding companies or subsidiaries of public companies which
can have 5 Directors of which 3 must be NEDs and majority
INEDs)
• Independent Non Executive Directors (INEDs) to appoint a lead
INED
• Separation of the role of CEO and Chairman
• Discourages cross-memberships on the boards of two or more
companies (unless within a group). The board should disallow it
where this will lead to a conflict of interest situation among
competing companies

14. Part C - Board of Directors (contd.)
14
 Concurrent directorships are permitted so long as it does not
interfere with the individual’s ability to discharge his
responsibilities.
 In assessing their suitability for appointment as a director, the
board and shareholders are required to carefully consider each
director’s other obligations and commitments
 Disclosures required regarding other board appointments
 Not more than two members of the same or extended family
shall sit on the board of the same company at the same time
 Companies required to establish a policy on diversity and
disclose the policy or a summary of that policy

15. Officers of the Board (contd.)
15
The Chairman:
• Responsible for ensuring effective operation of the board, cohesion
towards achieving the company’s strategic objectives
• A former MD/CEO shall not go on to be the chairman of the same
company. If in very exceptional circumstances the board decides that a
former MD/CEO shall become chairman, the cool off period shall be 7
years
• Both majority and minority shareholders must be consulted in advance
• The regulator must be informed of the appointment and the reasons for
the appointment
• Chairman to meet with NEDs without Executives present
• INEDs may meet without the Chairman present at least annually
• Chairman’s role articulated in 6.1.6 - 6.1.8
• Chairman should not sit on any board Committee except for RPCs
where the Chairman can sit on the nomination & governance
committee and remuneration committee but cannot be chair them

16. Officers of the Board (contd.)
16
The Lead Independent Non Executive Director (LINED):
• Appointed by INEDs
• Presides at the exclusive meetings of non-executive directors and
separate meetings of independent non-executive director
• To serve as intermediary for shareholders if they have concerns
which contact through the normal channels has failed to resolve
or for which such contact is inappropriate

17. Officers of the Board (contd.)
17
Managing Director/Chief Executive Officer
• Leads the Management team and reports to the Board
• Responsible for the day to day running of the company
• A person knowledgeable in relevant areas of the company’s activities;
demonstrate industry, credibility and integrity
• Has the confidence of the board and management
• Shall not be the only ED on the board
• The authority of the MD/CEO and the relationship with the board must
be clearly and adequately described in a letter of appointment
• The board may delegate its powers to the MD/CEO as it deems
appropriate
• The CEO’s remuneration is determined by the remuneration committee
and may include long term performance incentives, stock options and
bonuses

18. Officers of the Board (contd.)
18
Company Secretary (CS):
• A person with relevant qualification and competence necessary to
effectively discharge the duties of the office as articulated in S 298 of
CAMA
• Appointed through a rigorous selection process similar to that of new
directors
• Has the primary duty of assisting the board and management in
implementing the code and developing good corporate governance
practices and culture
• CS must be properly empowered by the board to discharge duties and
responsibilities
• Functional reporting line is through the Chairman to the Board
• Reports administratively to the MD/CEO
• Appointment and termination of the CS are matters for the board

19. Officers of the Board (contd.)
19
In addition to statutory functions, CS’s duties include:
 Provide the board and directors individually, with detailed guidance on
how to properly discharged their responsibilities in the best interest of
the company
 Coordinate the orientation and training of new directors
 Assist the chairman and MD/CEO in coordinating activities regarding
the annual board plan and with the administration of other strategic
issues at the board level
 Compilation of board papers and ensuring that the board’s discussions
and decisions are clearly and properly recorded and communicated to
the relevant persons
 Notify board members of matters that warrant their attention
 Provide a central source of guidance and advice to the board and the
company, on matters of ethics, conflict of interest and good corporate
governance

20. Officers of the Board (contd.)
20
Executive Directors
• Persons knowledgeable in relevant areas of the company’s activities
especially those relating to their specific functions
• Involved in the day-to-day operations and management
• Answerable to the board through the MD/CEO
• Not to be involved in the determination of their remuneration
• Level of remuneration should attract, retain and motivate directors of
the quality required to run the company successfully
• No sitting allowance or directors fees should be paid to EDs
• Permitted to take up NED role in other companies
• Prohibited from more than 1 NED role or chairmanship in a company
unless those companies are part of a group in which he is ED
• Excluded from membership of nomination and governance committee,
remuneration committee or audit committee (statutory or board)

21. Officers of the Board (contd.)
21
Non Executive Directors (NEDs)
• Appointed on the basis of their wide experience, specialist knowledge
and personal qualities
• Responsible for the performance evaluation of the MD/CEO and
Chairman (led by an INED)
 Have unfettered access to EDs, CS and the Internal Auditor, while
access to other senior management is through the MD/CEO
 Entitled to sitting allowances, directors’ fees and reimbursable travel
and hotel expenses. All payments to be disclosed in the Annual Report
 Should be provided with appropriate facilities and administrative
support for the effective discharge of their duties
 Entitled to adequate and comprehensive information on all board
matters in a timely manner

22. Officers of the Board (contd.)
22
Independent Non-Executive Directors
• Required to be independent in character and judgment; free from such
relationships or circumstances that will impair his ability to make
independent judgment
• Is not a substantial shareholder i.e. directly or indirectly holdings does not
exceed 0.1% of the company’s paid up capital
• Must not be the nominee of a substantial shareholder
• Is not a representative of a shareholder that has the ability to control or
significantly influence Management
• Has not been an employee of the company or group within the last five
years
• Does not render any professional, consultancy, or other advisory services to
the company or the group, other than in a capacity of a director
• Has not served on the board for more than nine years from the date of his
first election
• Annual meeting of only independent non-executive directors
• INEDs are required to annually declare their continuing independence

23. Officers of the Board (contd.)
23
Independent Non-Executive Directors (contd)
• Is not an extended family member of any of the company’s advisers,
directors, senior employees, consultants, auditors, creditors, suppliers,
customers or substantial shareholder
 Does not have, and has not had within the last five years, a material
business relationship with the company either directly, or as a partner,
shareholder, director or senior employee of a body that has, or has had,
such a relationship with the company
 Does not hold cross-directorships or significant links with other directors
through involvement in other companies or bodies
 An INED may seek and obtain request the company to provide them with
external professional advice
 The reclassification of an existing non-executive director into an
independent non-executive director is not permitted
 An INED who resigns before the expiration of his term, must disclose to the
appropriate regulator(s) the reasons for such resignation

24. Meetings of the Board
24
 The board shall meet at least once every quarter
 Each director required to attend at least two-thirds of all board
meetings.
 Attendance record shall be among the criteria for the re-
nomination of a director by the board except where there are
cogent reasons which the board must notify the shareholders of,
at the AGM
 Where a majority of independent non-executive directors
dissent on an issue decided by the board, such decision can
only be valid where at least 75% of the full board (without
reference to quorum) vote in favour of such decision.

25. Board Committees
25
 The number and composition of committees to be determined by the
Board
 Membership to be reviewed and reconstituted every 3 years
 A Charter should be approved for each committee setting out the terms
of reference and composition
 Boards of regulated private companies may merge any of the
committees subject to adequate board oversight and regulatory
concurrence
 Where there is a combined audit and risk management committee, the
officer overseeing risk should only be present when the committee is
discussing risk issues and not when audit matters are being considered
 The CS, or any other officer in the office of the CS, shall be the secretary
of all board committees
 Minutes should be prepared and circulated on a timely basis and must
not be written for meetings not actually held.

26. Nomination and Governance Committee
26
 Composed of at least 3 members, all NEDs, a majority being
INEDs
 Chaired by INED appointed by the Board duties include:
 Annually review the structure, size and composition of the board at
least annually and make recommendations on any proposed changes
 Establish the criteria for board and board committee membership,
review prospective candidates’ qualifications and any potential
conflict of interest, assess the contribution of current directors
against their re-nomination suitability for re-nomination and make
appropriate recommendations to the board.
 Identify suitably qualified persons for nomination and appointment
as directors
 Ensure that the board undertakes an annual performance evaluation
 Undertake the annual assessment of the independent status of
INEDs

27. Remuneration Committee
27
 Composed of at least 3 members, all NEDs, a majority being INEDs
 Chaired by INED appointed by the Board
 Duties include:
 Development of a formal, clear and transparent procedure for
developing the company’s remuneration policy
 Recommendation to the board on the:
 Company’s Remuneration policy and structure for all executive
directors and senior management employees
 Remuneration of non-executive directors
 Compensation payable to executive directors and senior management
employees for any loss of office or termination of appointment to
ensure that it is consistent with contractual terms, fair and not
excessive.
• The remuneration committee may engage an independent remuneration
consultant (name to be disclosed in AR) at the expense of the company for
the purpose of carrying out its responsibilities.

28. Audit Committee
28
 Every public company must establish a Statutory Audit Committee
(SAC) S359 (3) of CAMA
 Functions are as set out in S359 (6) and the Memorandum of
Association and Articles of Association of the Company
 Every public company required to have a board audit committee (BAC),
in addition to a SAC
 Members required to have financial literacy and be able to read and
interpret financial statements
 Persons serving on any Audit Committee, whether SAC or BAC, have
coextensive responsibilities and must have relevant experience,
competence and knowledge that would enable them serve on either or
both of the two committees
 The recommendations made in the SAC report to shareholders or the
BAC report must be predicated on and evidenced by the work done by
the Committee, verifiable where necessary, by regulatory action

29. Board Audit Committee
29
 Additional responsibilities of the BAC are articulated in Clause
8.14.9 of the code including but not limited to:
 Oversight over the integrity of the company’s financial statements,
compliance with legal and other regulatory requirements, assessment of
qualifications and independence of external auditor, and performance of
the company’s internal audit function as well as that of external auditors;
 Identification of key risks and oversight to ensure effective controls are
in place to mitigate those risks
 Ensure there are other means of obtaining sufficient assurance of regular
review or appraisal of the system of internal controls
 Ensure that adequate whistle-blowing procedures are in place
 Invoke its authority to investigate any matter within its Charter for
which purpose the company must make available the resources,
including access to external advice where necessary
 BAC is required to have an in camera session with the Internal
Auditor annually

30. Board Audit Committee (contd)
30
 Private companies also required to have BACs
 At least 1 member of the committee shall be an expert and have
current knowledge in accounting and financial management
 BAC composed of at least 3 members, all NEDs, a majority being
INEDs
 Chaired by a INED
 Committee required to meet at least once every quarter

31. Risk Management Committee
31
 Composed of a majority of NEDs; at least 1 should be an INED
 Chaired by an INED and meet at least quarterly
 Duties include but are not limited to:
 Assist the board in its oversight of the risk profile, risk management
framework and the risk strategy of the Company
 Review the adequacy and effectiveness of risk management and controls
in the company
 review of the company’s compliance level with applicable laws and
regulatory requirements
 Ensure that Information Technology assets are managed effectively
 Annually review the company’s Information Technology governance
framework
 A member of senior management responsible for performing the risk
function must attend meetings of the committee

32. Appointment to the Board
32
 The board is required to develop a formal, clearly defined and
transparent procedure for board appointments
 Criteria for appointment should take cognisance of the strengths
and weaknesses of the existing board, required skills, and
experience as well as current age range and gender diversity
 Appointments shall be a matter for the board as a whole
 The nomination committee shall recommend names of
prospective candidates for consideration for directorship
positions
 Regulatory consent must be obtained where required
 Shareholders shall be provided with biographical information of
proposed directors

33. Induction and Continuing Education
33
 Formal induction programme for new directors of the company
 Mandatory for all directors to participate in periodic, relevant,
professional continuing education programmes in order to
update their knowledge and skills
 The company is required to disclose in the annual report (AR)
the courses attended by each director

34. Terms and Conditions of Service
34
 Letters of appointment to articulate the following issues:
 Duration or term of appointment
 Remuneration package and method of remuneration
 Explanation of the duties of care, skill, diligence and loyalty
and other responsibilities of the director
 Requirement to disclose any material interests in the company
and other entities related to the company as well as interests
 Periodic disclosure of material interests in contracts in which
the company is interested or involved
 board meeting attendance
 Synopsis of directors’ rights
 Formal orientation programme or training
 Copy of Board Charter, Code of Business Conduct and Ethics
 Directors’ evaluation programme and
 Any other contractual responsibilities

35. Access to Independent Advice/Information
35
 The board shall ensure that directors, especially non-executive
directors, have access to independent professional advice at the
company’s expense where they consider it necessary to discharge
their responsibilities
 The Board must be provided in a timely manner; with
information in a form and of a quality appropriate to enable it to
discharge its duties
 This is without prejudice to the right of the Board to have access
to all documents and information relating to the management of
the company at all times

36. Tenure and Re-election of Directors
36
 Reaffirms retirement by rotation as provided in S 259 of CAMA
 Maximum tenure of the MD/CEO not to exceed two terms of 5 years
each
 Maximum tenure of the EDs other than the MD/CEO not to exceed
three terms of 4 years each
 Where an ED is appointed MD/CEO, his tenure in the new role starts
from the date he assumed the position of MD/CEO and he is entitled to
two terms of five years each PROVIDED that no person shall serve as
an ED of a company for a combined period of more than 15 years in
total
 Tenure of NEDs shall not exceed three terms of 4 years each

37. Performance Evaluation
37
 Formal and rigorous annual evaluation of board performance, that of
its committees, the chairman and individual directors.
 Evaluation system shall include the criteria and key performance
indicators and targets
 The result of the board performance evaluation must be communicated
and discussed by the board as a whole, while those of individual
directors should be communicated and discussed with them
individually by the chairman
 Directors with unsatisfactory results are required to undergo
appropriate training
 Where further training is not feasible, the director may be removed or
requested to retire
 An external consultant may be engaged to perform the evaluation and
the name of the consultant must be disclosed in the AR
 The evaluation results must be disclosed in the AR on a named
basis

38. Part D – Risk Management and Audit
38
 The Board is responsible for:
 The oversight of enterprise-wide risk management
 Ensuring that the risk management framework is integrated into the
day-to-day operations of the business
 Undertaking an annual thorough risk assessment covering all aspects
of the company’s business
 Obtaining and reviewing periodically relevant reports to ensure the
ongoing effectiveness of the company’s risk management framework
 Ensuring that the company’s risk management policies and practices
are disclosed in the AR
 The directors are required to report on the going concern status of
the company in annual and half-yearly financial statements with
supporting assumptions and qualifications as necessary

39. Internal Audit Function
39
 All companies are required to have an effective risk–based internal
audit function
 Where the board decides not to establish such a function, the reason for
the decision must be disclosed in the AR
 The Internal Audit Unit must be headed by a professional with relevant
qualification who has registered with the regulator
 The Head of Internal Audit Unit reports directly to both the BAC and
the SAC (where both co-exist) while having a line of communication
with the MD/CEO
 The Head of Internal Auditor is required to give quarterly reports to the
AC on the adequacy and effectiveness of management, governance, risk
and control environment, deficiencies observed and management
mitigation plans
 The internal audit function is required to develop an annual risk-based
internal audit plan in line with the risk-based internal audit process
and to be approved by the AC

40. Internal Audit Function (contd)
40
 An external assessment of the effectiveness of the internal audit
function must be conducted at least once every 3 years by a qualified
independent reviewer, as defined by the Institute of Internal Auditors,
or by an external review team
 The head of the internal audit function to be a member of senior
management and can only be removed by the board on the
recommendation of the SAC/BAC
 Public Interest Entities are prohibited from outsourcing their internal
audit functions.

41. Whistleblowing
41
 Defines whistle-blowers as any person(s) including the employees,
management, directors, customers, service providers, creditors and
other stakeholder(s) of a company who reports any form of unethical
behaviour or dishonesty to the appropriate internal authority or
external regulators
 Extensive provisions set out in Section 18.1 – 18.15
 Companies are required to develop whistle blowing policies and
mechanism that are known to its stakeholders
 The identity of the whistleblower must be kept confidential
 No whistleblower should be subjected to any detriment
 Any whistleblower who suffers any detriment may present a complaint
to the regulator without prejudice to his right to take legal action
 Such whistleblower is entitled to compensation/and or restatement

42. External Auditors
42
 Companies required to appoint external auditors as required by
 The code mandates Listed and Significant Public Interest Entities to
engage Joint External Auditors for their statutory audit. These entities
are those whose market capitalisation is not less than =N=1 billion
and/or whose annual turnover is not less than =N=10 billion
 Where the existing or first statutory auditor is an international firm, the
second auditor (which must be a national firm) must be appointed by
show of hands rather than by poll
 Tenure of External audit firms is ten years continuously and may be
considered for reappointment seven years after their disengagement
 Audit partners to rotate every 5 years
 No audit partner can be appointed to the Board of a company that his
firm is auditing or has audited until 5 years after conclusion of audit or
disengagement of the partner
 No partner or employee of an audit firm can be employed by the
company which the audit firm has audited until after a period of not
less than 3 years after the exit of the partner or employee

43. External Auditors (contd)
43
List of non audit services include:
 accounting and book keeping services
 internal audit services
 design and implementation of any financial information system;
 actuarial services
 investment advisory services
 investment banking services
 rendering of outsourced financial services
 management services
 taxation services
 performance evaluation of the board and its committees; and
 any other kind of services as may be proscribed by the regulators

44. External Auditors (contd)
44
 Where the FRC is satisfied that an external auditor of a company has
abused his office or acted in a fraudulent manner or colluded in any fraud
in the company, it may by regulatory order direct the company to approach
its members to consider and resolve whether on the basis of any facts
revealed, the company in general meeting shall change its auditors
 No direct reciprocal change of the same firms of auditors taking the form of
two audit firms succeeding each other as opposites in audits from which
they have just mandatorily retired
 AC decision for the appointment, re-appointment or removal of an
external auditor can only be overridden by a 75% vote of the
board’s full membership
 Where External Auditors discover or acquire information during an audit
that leads them to believe that the company or anyone associated with it
has committed an indictable offence under CAMA or any other
Statute, they must report this to the Regulator, whether or not such
matter is or will be included in the Management Letter.

45. Part E: Relationship with Shareholders
45
Interaction with Shareholders
• The Board is required to establish a system of constant dialogue with
shareholders, majority and minority, based on mutual understanding of the
objectives of the company
• The lead independent non-executive director (where appointed) may
attend sufficient meetings with a range of shareholders to listen to their
views in order to help develop a balanced understanding of their issues and
concerns
• The Board must disclose in the AR the steps it has taken to ensure that the
members of the board, and in particular the INEDs, develop an
understanding of the views of all shareholders

46. Constructive Use of the Annual General Meeting (AGM)
46
 Should be the primary but not the only avenue for engaging
shareholders
 Shareholders must be treated fairly and given equal and simultaneous
access to information about the company
 GMs must be conducted in an open manner allowing for free
discussions on all issues on the agenda
 Sufficient time to be allocated to shareholders, particularly minorities,
to participate fully and contribute effectively at the meetings
 Chairmen of all board committees and of the SAC must be present at
general meetings of the company to respond to shareholders’ queries
and questions

47. Protection of Shareholder Rights
47
The Board must ensure that:
 Shareholders’ statutory and general rights are protected at all
times. In particular, their powers to appoint and remove
directors of the company
 All shareholders are treated fairly and equally. No shareholder,
however large his shareholding or whether institutional or
otherwise, shall be given preferential treatment or superior
access to information or other materials
 Minority shareholders are treated fairly at all times and are
adequately protected from abusive actions by controlling
shareholders
 The company promptly renders to shareholders documentary
evidence of ownership interest in the company such as share
certificates, dividend warrants and related instruments.

48. Venue/Notice of Meetings/Resolutions
48
 The venue of a general meeting shall be accessible to shareholders
 Notices of general meetings shall be at least 21 days from the date on
which the meeting will be held.
 Allow at least seven days for service of notice if sent out by post from
the day the letter containing the same is posted
 The notices shall include copies of such documents, including annual
reports and audited financial statements and other information as will
enable members prepare adequately for the meeting
 Unrelated issues for consideration should not be lumped together at
GMs.
 Statutory business shall be clearly and separately set out. Separate
resolutions must be proposed for each matter fro discussion
 The board is required to ensure that decisions taken at GMs are duly
implemented

49. Role of Shareholders’ Associations
49
The board of every public company is required to ensure that
 dealings of the company with shareholder associations are
always transparent
 In any interaction or dialogue with shareholders, invitations
are also sent on a random or purposive selection basis to
minority shareholders in their individual capacities to act as a
sounding board for the personal views of the minority
shareholders of the company.
 This is without prejudice to the role of shareholders’
associations

50. Institutional Investors
50
Institutional investors are required to:
 publicly disclose their policy on how they discharge their
stewardship responsibilities
 have a robust policy on managing conflicts of interest in relation
to stewardship which shall be publicly disclosed
 monitor their investee companies
 establish clear guidelines on when and how they will escalate
their stewardship activities
 be willing to act collectively with other investors where
appropriate
 have a clear policy on voting and disclosure of voting activity;
and
 report periodically on their stewardship and voting activities.

51. Part F: Minority Shareholder Protection
51
 To protect minority shareholders and other stakeholders,
insiders are precluded from engaging in transfers of assets and
profits out of companies for their personal benefits or for the
benefit of those who control the company
 A shareholder or group of shareholders, holding in aggregate not
less than one per cent of the share capital or shares of a
company, is entitled to submit items for inclusion in the agenda
 Controlling shareholders have a fiduciary responsibility to
minority shareholders and are entitled to call a GM to discuss
major or extraordinary transactions
 Insiders are precluded from buying and selling any security in
breach of their fiduciary duty and other relationship of trust and
confidence while in possession of material, privileged, non-
public, and price-sensitive information about the security

52. Related Party Transactions/ Conflict of Interests (CoI)
52
 All transactions between related parties must be disclosed
 The board must put in place a distinct policy on conflict of
interest situations
 Directors shall promptly disclose any real or potential conflict of
interest that they may have by virtue of their membership of the
board
 A director must not be present during the time any matter on
which he has an interest is being decided
 CoI disclosures must be recorded in the minutes
 No member of executive management (director level and above)
leaving the services of a relevant regulatory institution, for any
reason, shall be appointed as a director or top management staff
of an institution that has been directly supervised or regulated by
the said regulatory institution until after 3 years of
disengagement from that regulatory institution

53. Part G: Relations with other Stakeholders
53
Sustainability Issues:
 Companies are to pay adequate attention to the interests of their
stakeholders
 Boards and individual directors must commit themselves to transparent
dealings and to the establishment of a culture of integrity and zero
tolerance of corruption and corrupt practices
 The board shall report annually on the nature and extent of its social,
ethical, safety, health and environmental policies and practices. Issues to be
reported on are detailed clause 32.3 including but not limited to:
 The company’s business principles and codes of practice and efforts
towards implementation
 Description of workplace accidents, fatalities and occupational and
safety incidents against objectives and targets
 Disclosure of the company’s policies, plans and strategy for addressing
and managing the impact of HIV/AIDS, malaria and other serious
diseases on the company’s employees and their families

54. Relations with other Stakeholders (contd)/Company
Investors’ Portal
54
 Nature and extent of employment equity and gender policies and
practices
 Adoption, in the company’s operations, of options with the most benefit
or least damage to the environment, particularly for companies
operating in disadvantaged regions or in regions with delicate ecology
 The company’s policies on corruption and related issues
 The conditions and opportunities created for physically-challenged
persons or disadvantaged individuals
 The nature and extent of the company’s social investment policy
 Company reports and other communications to shareholders and other
stakeholders must be in plain language, readable and understandable
and consistent with previous reports
 Company must establish web sites and investors’ portals where the
communication policy other relevant information about the company
are published and made accessible in downloadable format to the
public

55. Part H: Transparency
55
 Companies are required to strive to achieve international best practices
and engage in full disclosure of all the matters set out in the Code
 The CEO and CFO must provide a joint attestation to the board that the
company’s financial statements present a true and fair view, in all
material respects, of the company’s financial condition and operational
results and are in accordance with relevant accounting standards
 The company’s AR must include:
 A corporate governance report
 Make sufficient disclosure on accounting and risk management issues
 A statement by the board with regards to the company’s degree of
compliance with the provisions of the Code
 Details of any director’s interest in contracts either directly or indirectly
with the company or its subsidiaries and holding companies
 Details of any service contracts and other contracts with controlling
shareholder(s), their group networks and associates

56. Part H: Transparency (Contd)
56
 Separate related party transactions must be made for each related
entity
 The Chairman’s statement in the annual report must provide a
balanced and readable summary of the company’s performance for the
period under review and future prospects, and must expressly state
whether the board’s expectations (financial and non-financial) for the
reporting period have been met
 The board is required to use its best judgment to disclose any matter
even though not specifically required by the Code if in the opinion of
the board such matter is capable of affecting the financial condition of
the company or its status as a going concern
 The onus of proof of such possible negative effect is on the board.
 The Regulator is entitled to demand for further documents or reports
from the company to enable it validate the disclosures made

57. Corporate Governance Evaluation
57
 An annual corporate governance evaluation must be carried out
and facilitated by a registered independent external consultant
 The corporate governance evaluation cannot be carried out by
the company’s external auditor or a firm related to the external
auditor
 The evaluation report is presented at the AGM, a copy sent to the
regulator and also put on the investors’ portal

58. Part I: Code of Business Conduct and Ethics
58
 Companies are required to Code of Business Conduct and Ethics which
will be regarded as part of the corporate governance practices of the
company
 Globally Responsible Business Conduct
 Enterprises operating within a global context must take into account
the established processes in the countries in which they operate,
while considering the views of all relevant stakeholders
 Refrain from seeking or accepting exemptions not contemplated in
the statutory or regulatory framework related to human rights,
environmental, health, safety, labour, taxation, financial incentives,
or other issues

59. Part J: Enforcement/ Part K: Miscellaneous
59
 Violations of the provisions of the Code will occasion both personal
sanctions against the persons directly involved in the violation, and
sanctions against the companies or firms involved
 No commencement date
 On commencement the code supercedes corporate governance code in
force in Nigeria before that date

60. 60
Thank you for
your attention