CORPORATE GOVERNANCE: THE TURNING POINTS - UBA Plc

The GMD’s Inspirational LectureThe existence of a checklist stipulating best practices of corporategovernance is however only one side of the equation; the otherside is good faith by the operators. Let us look at a few examples.One of the key aims of corporate governance is ensuring thatthose charged with management oversight possess the requisiteindustry knowledge and experience. Take the banking industry inNigeria as an example. No useful purpose will be served having aroad-side mechanic who comes into sudden wealth sitting on theboard of a Bank. He will be mostly useless in the conduct of theserious business of the board. A person cannot perform a role hedoes not understand. (Recall the kebab salesman in ourintroductory story who when asked by a potential buyer what kindof meat (pock? beef? poultry?) was used for the kebab repliedthat it was “stick meat” ostensibly because the kebab weredisplayed on sticks). Thus, Rule 4.11 of the Code of CorporateGovernance For banks in Nigeria Post Consolidation stipulates that“All Directors should be knowledgeable in business and financialmatters and also possess the requisite experience”. There can beno denying the fact that this is a helpful provision which ought tobe rigorously enforced especially against the background ofrecent history, where a record-setting 419ner with no verifiablerecord of previous involvement in any serious business somehowmanaged to wangle his way (presumably with CBN and StateSecurity clearances) into the Board of one of the biggest banks inNigeria.But the fact that directors have the right qualification does notguarantee the fidelity of those directors. Take the Enron case. TheChairman of its Audit Committee was a former Dean of theStanford Business School. Among its directors were numbered aformer member of the British House of Lords and House of15 | P age