Tracing the Evolution of Corporate Governance Regime in Nigeria

Abstract

Corporate governance has been an emerging subject of worldwide interest in the 21st Century following the failure of going concerns which were hitherto, thought to financially stable before their collapse. Nigeria has its fair share of corporate collapse which has made it to embrace and develop its corporate governance regime. Corporate governance has experienced fast growth leading to a development of corporate governance provision in various statutes and codes within a short period. This paper seeks to undertake an overview of the corporate governance framework in Nigeria which is contained in various statutes and codes. Thus, a historical perspective is adopted to understudy the evolution of corporate governance from its little beginning to present time. The emergence of several corporate governance regimes within a short time in Nigeria demonstrates that corporate governance has become fully entrenched in Nigeria. The establishment of the Financial Reporting Council of Nigeria (FRCN) Private, Public and Not-for-profit Corporate Governance Codes of 2016 heralded a revolution in corporate governance in Nigeria. These 2016 Codes provided imperative clout which pre-existing code lacked. However, corporate governance encountered some hiccups following the various legal controversies which led to the suspension of the Code. The latest, being the 2018 Code, was created to resolve these issues by adopting the “apply and explain” principles and exempt private entities without significant public interest from mandatory adoption of the code. The effect is that, the legal development has witness the evolution of corporate governance codes from flexible to rigid and then back to a flexible code with mechanisms set out to ensure attainment of the underlining corporate governance objectives in Nigeria.