The Nigerian Stock Exchange (NSE or Exchange) and The Convention on Business Integrity (CBi) held a certification ceremony for 35 companies and 437 directors that made it over the 70% threshold for the Corporate Governance Rating System (CGRS) process. The companies were awarded the CGRS certification while the directors were awarded certificates for success in the Fiduciary Awareness Certification Test (FACT), which is a key component of the CGRS.
The Vice-President of The Federal Republic of Nigeria, Professor Yemi Osinbajo who was ably represented by Ambassador Chiedu Osakwe, the Nigeria Chief Trade Negotiator/Director General Office of Trade Negotiation delivered the closing remarks. The event saw the successful companies and directors presented with certificates confirming their CGRS certifications.
Speaking at the event, Soji Apampa, Co-Founder and Chief Executive Officer, CBi said “this is a triumph for collective action in the fight against corruption and unethical practices. I congratulate the companies and directors being honoured today and I urge them not to relent in their efforts to sustain the high level of corporate governance that has brought them thus far. Today’s celebration is not a destination but a continuous process that should be consistently maintained and further improved upon. I encourage other listed companies still on this evolutionary process to keep at it and conclude the process during this new review period which is now open.”
Another highlight of the event was the launch of the Corporate Governance Index of the NSE. The Index will track the performance of the 35 CGRS rated companies using their market capitalization, free float and corporate governance rating scores. The Index will be reviewed on a bi-annual basis at which point other companies that have become CGRS rated in the interim may be added to the Index or companies that have had their ratings suspended or withdrawn may be removed. The Index is expected to be an important tool for investors keen on investing in well governed companies as well as corporates eager to distinguish themselves on the ground of governance.
Speaking on the newly introduced Index, Oscar N. Onyema, OON, CEO of The Nigerian Stock Exchange said, “The launch of the CG Index is an important milestone to strengthening listed companies by tracking their corporate governance practices. This index will increase transparency in our market and provide investors additional data points upon which to make sound decisions. I congratulate the companies that have successfully completed the process and I expect that they will be more positively looked at whilst trying to raise and access capital within or outside of our jurisdiction.”
The CGRS was launched on November 3, 2014 after a successful pilot phase involving a number of companies listed on the NSE some of which are now listed on the Premium Board. The CGRS was designed to rate companies that are listed on the NSE based on their corporate governance and anti-corruption culture. 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 feedback on actual company behaviour is sought from internal and external stakeholders. Combinations of the 3 segments with attendant weighted scores are collated and companies with a score of 70% and above accorded the CGRS certification celebrating the degree to which they have evolved the quality of their corporate governance.