Secretary to Securities and Exchange Commission (SEC) Mr. Edosa Aigbekaen has stressed the need for shareholder groups to be more responsive at ensuring accountability and effective management of their company instead of focusing on short term profits.
He also urged shareholders to take more interest in sustainable returns and longer term performance in order to be active on corporate governance issues.
Speaking in Abuja at the Journalist academy organized by SEC, Aigbekaen urged shareholders to make effort to take managers of companies to task regarding the management of their companies, adding that the code of conduct for shareholders formulated in 2006 by SEC was aimed at sanitizing their activities and positioning them to effectively promote good corporate governance in public companies for enhanced shareholders value.
Other benefits of the code according to him were designed to ensure that association members uphold high ethical standards and make positive contributions in ensuring that the affairs of public organizations are run in transparent manner.
Speaking further he said, although all countries have their own unique system of corporate governance reflecting different economic, cultural and legal circumstances, the effectiveness of corporate governance dependent on a myriad of factors and cannot simply be measured by profitability, growth or share performance.
He, however, said that the increasingly international nature of business and investment, coupled with regulatory responses to corporate scandals were encouraging demands from companies and investors for consistency in corporate governance practices across jurisdictions.
Aigbekaen explained that framework for corporate governance differs from country to country, adding that in the United States of America’s approach can be characterized as regulated-led system predominantly enforced through Securities and Exchange Commission regulations, Stock Exchange listing rules and State laws, adding that that US approach is less reliant on shareholders engagement but in United Kingdom shareholders are empowered through rights in company law to play an active role.
He stated that a framework provide the board with a structured way to collaborate with management on specific issues the company faces with minimal risk of confusion and loss of productivity.