Twenty-five companies quoted on the Nigerian Stock Exchange, NSE, have passed the Corporate Governance Rating System (CGRS) of the NSE, the bourse said Monday.
A statement by the NSE said that the Steering Board of the CGRS made the announcement after the 25 companies scored the required pass mark of 70%.
The statement added that 87 other companies are at various stages of completion of the process.
“These 25 successful companies join 8 companies that retained their rating from the CGRS pilot in 2014, bringing the total number of companies rated as of today to 33,” the bourse said.
“The board 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).”
The CGRS was introduced 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 behaviour 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.
The Chairman of the Steering Board and Executive Director, Regulation, NSE, Tinuade Awe, noted that 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.
She said, “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”.
Soji Apampa, Chief Executive Officer, The Convention on Business Integrity (CBi), a firm that partnered with the NSE to design, pilot, roll-out and manage the initiative, 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. He added that it is important to celebrate companies and directors who are leading the renewed charge whilst encouraging others to participate.
In his remarks, Oscar Onyema, CEO of The Nigerian Stock Exchange, noted that “as we make surefooted steps to globalise our market, the CGRS rating will bolster the confidence to invest in our market especially from international investors. Increasingly, our listed companies are meeting their compliance requirements and we will continue to protect investors in our market through a robust regulatory regime”.