KEYNOTE ADDRESS BY THEDIRECTOR GENERALSECURITIES AND EXCHANGE COMMISSIONMs ARUNMA OTEHAT THE INTERNATIONAL CONFERENCEONGOOD GOVERNANCE AND REGULATORYLEADERSHIP

PROTOCOL

It gives me pleasure to welcome you to this conference on

“

GoodGovernance and Regulatory Leadership

”

, being jointly organized bythe Securities and Exchange Commission (SEC, the Central Bank of Nigeria (CBN) and the Commonwealth Business Council (CBC) inconjunction with the Nestor Associates and FDHL-MT Ltd. The corporate failures which characterized 2000 to 2002 wheninstitutions like Enron and WorldCom collapsed brought corporategovernance issues to the front burner. The corporate failures no

doubt drew the world’s attention to the fact that good corporate

governance was extremely important to corporate performance andsurvival; indeed there is a nexus between good corporategovernance and the preservation of shareholders value,

safeguarding investors’ assets and promoting financial stability

particularly, when governance of financial institutions is concerned.Indeed good corporate governance has become an important indexfor institutional investors participation in business enterprises andfinancial markets.Financial institutions which are poorly governed pose a riskthemselves and also to others and could indeed pull down financialmarkets. Recent experience in the Nigerian financial market attestto this fact. Irrespective of how sound macroeconomic policies are, if entities especially financial institutions are not well governed, themacro economic objectives may not be attained.

There is no gainsaying that good corporate governance strengthensconfidence in capital markets and therefore helps theirdevelopment. In the same vein, capital markets engender goodcorporate governance through their disclosure, reporting andtransparency requirements. To strengthen corporate governance practice in Nigeria, the SEC in2003 released a code for the capital market. This code has recentlybeing reviewed by the A B Mahmoud committee on corporategovernance which has been exposed to the market and commentsreceived .The final version is expected to become effective soon.

The Code is an important milestone in the nation’s quest for good

corporate governance and the protection of investors as it containsextensive provisions to protect investors and other stakeholders.For instance, the Code spells out the Composition andresponsibilities of the Board of Directors, it makes provision forIndependent Directors, Dual Board membership, remuneration of Board members, Composition of Audit Committees, frequency of meetings etc. The new Code of Corporate Governance hasaddressed the limitations in the old code, which if properlyimplemented will ensure the attainment of the components of goodcorporate governance in the management of public quotedcompanies.