To sustain investors’ renewed interest in the nation’s capital market and entrench high level of corporate governance in the affairs of listed firms, the steering board of the Corporate Governance Rating System (CGRS) has announced the names of 25 companies that have successfully passed its governance rating test, having scored the required pass mark of 70 per cent whilst 87 others are at various stages of completion of the process. The Nigerian Stock Exchange (NSE), in partnership with The Convention on Business Integrity (CBi) designed and roll-out the initiative,
These 25 successful companies join eight companies that retained their rating from the CGRS pilot in 2014, bringing the total number of companies rated as of today to 33.CGRS was introduced to mitigate corporate failures, occasioned by corruption and poor corporate governance, as well as a repeat of the financial crises that shook many economies in 2007.
The initiative was incorporated into the Nigerian Capital Market in 2012 and launched in 2014 after it was successfully piloted with a number of volunteer companies, including those now listed on the Nigerian Stock Exchange’s Premium Board.
The process comprises three segments: an independently verified, self-assessment by the company; a certification of director awareness of their fiduciary duties; and, a corporate integrity assessment where perceptions of actual company behavior are sought from internal and external stakeholders.
Combinations of the three segments with attendant weighted scores are collated and companies with a score of 70% and above will be accorded the CGRS certification mark celebrating the degree to which they have evolved the quality of their corporate governance.
Dangote Cement Plc, Zenith Bank Plc, United Bank for Africa Plc, FBN Holdings Plc, Access Bank Plc, Diamond Bank Plc amongst others were those who retained their ratings in the period under review.
Addressing journalists on the recent developments in CGRS as it relates to listed companies in Lagos on monday, the board of CGRS also congratulates the 435 directors who have passed their certification test.Presentation of awards and certificates to Chairs of companies and directors being celebrated will hold in February 2018 (event details to be announced later).
According to the Chairman of the Steering Board and Executive Director, Regulation, NSE, Ms. Tinuade Awe, “The investors and other stakeholders wants to see positive turnaround on their investment. The issue of governance has taken to the front burner after the 2007 crises; the initiative would help to provide appropriate governance for listed firms.
“The period between 2000 and 2010 were difficult years for business around the world, littered with major corporate failures due to corruption and poor corporate governance, as well as financial crises that shook many economies.
“Companies have since then been evolving their ability to improve board structure and responsibility; business ethics and anti-corruption; transparency and disclosure; internal and external audit and control; and, better protect stakeholder and shareholder rights.
Nigerian companies have not been left out of this evolution where better business leadership and performance is expected to lead to improvements and growth in the Nigerian economy as a whole.”
The Chief Executive Officer of CBi, Soji Apampa, said: “The success rate and increased participation in the CGRS initiative is a testament to the rising acclaim that corporate governance is receiving in corporate Nigeria. It is important to celebrate companies and directors who are leading the renewed charge whilst encouraging others to participate.
“We continue to celebrate companies where we notice that corporate governance is evolving nicely.”The members of the CGRS Steering Board are Ms. Tinuade Awe of the NSE, Ms. Olubukanla Rufai representing the Securities & Exchange Commission, SEC, Mr. Wole Famurewa of CNBC Africa, Ms. Vivien Shobo of Agusto & Co., Mr Soji Apampa, of The Convention on Business Integrity and Ms. Cynthia Akpomudiare, Project Director, CGRS.