Documente Academic
Documente Profesional
Documente Cultură
GOVERNANCE IN NIGERIA
NIGERIA)
BY:
BAMDUS BASTU
OCTOBER, 2009.
CHAPTER ONE: INTRODUCTION
economic and business debate. A series of events over the last two
council as the case may be, the rules governing takeovers, the role
the reforms tout their potential not only for generating greater
corporate governance.
and processes.
(OECD, 2001).
of the 1980s and 1990s and the more recent Enron and World Com
corporate managers.
and political gains with a dual mandate to benefit both the state
The Ogun State Government in line with the policies of the then
across the country with Abuja Office as the co-ordinating unit. The
Ogun State Liaison office, Abuja was created to assist indigenes of
Ogun state and potential investors both within and outside the
There are numerous other duties and functions of the liaison office
in the private and public sector, this country will experience growth
allows for all stakeholders: all groups and individuals who are
Liaison offices in Nigeria and anywhere else are setup to act as local
it’s observed that most of these liaison offices are not functioning
however is not limited to only the Liaison offices but covers the
high necessity.
The Ogun State Liaison office, Abuja, Nigeria was chosen as case
economy.
Nigeria.
tunneling.
The Ogun state Liaison office despite its credible performance still
Nigeria,
making or not).
in Nigeria?
Nigeria.
Nigeria.
governance in Nigeria.
in Nigeria.
other stakeholders.
organization. The data gathered from the study would yield valuable
five chapters. Apart from chapter one which this part concludes,
liaison office.
Chapter three is research methodology and it discusses the
the study and the statistic model used will be outlined. Considering
the available option, the researcher chooses the use of primary data
as the best option suitable for this study. This approach is employed
presidency/national assembly.
She also went further to discuss the major findings and proffer
corporate governance.
CHAPTER TWO
2.0 INTRODUCTION
governed.
Ogun state liaison office, Abuja are the executive governor of Ogun
state, the Ogun state citizens (or tax payers), management, and the
managing public affairs. The strong appeal of the concept which has
respect that both parties have for each other’s role”. It is a culture
“People doing not just what the rules say but about doing what is
right”.
agencies can do, who controls them, how that control is exercised,
and how the risks and return from the activities they undertake are
Law School).
“Corporate Governance is concerned with holding the balance
governance project. These are the state, the civil society, and the
society. In the final analysis, governance is good when all the actors
(Mohideen, 1997).
observes that:
1997:14).
the late 1970s and 1980s. The success of the market friendly
framework.
public sector alone can provide basic services that affect the living
Bank, 2000a).
the provisions of the charter for public service in Africa, which was
their duties were identified among others as the principles and rules
business; and
enforcement.
applications
programs, and carry out policies (2) the private sector whose
policy area.
of policy impact in the society. Being closer to the people, CSOs can
legitimacy does not only derive from the support they receive from a
observed:
The consolidation of single parties, president-for-life,
the cost of capital by reducing risk and creates higher firm valuation
depreciation.
believed to be the key reasons behind the Asian Crisis of 1997. Such
financial crises have massive economic and social costs and can set a
information asymmetry the agent (in this case, the directors and
interested in the well-being of the firm and that these parties often
achieved.
will increase by at least one dollar the long-term value of the firm.
situation or externalities.
between theory and evidence. The first, already alluded to, concerns
of the firm.
CHAPTER THREE
RESEARCH METHODOLOGY
the Ogun state liaison office, Abuja in Nigeria. The study is set to
more on the public sector. Therefore, for the purpose of this study,
country.
Both primary and secondary data were used. The main sources
corporate governance in Ogun state liaison office, Abuja and its role
(i) Questionnaires:
administered.
(ii) Interviews
personnel.
(iii) Publications
stakeholders. The draft copy of the new Ogun state liaison office’s
small group of consumers who are typical of the target market. The
market, because the sample size is too small. Focus group results,
questionnaires administered.
influenced by the fact that the Ogun state Liaison Office is a multi
were administered but only four hundred and ninety eight (498)
follows:
performance in Nigeria.
governance in Nigeria.
governance in Nigeria.
specification is as follows:
CG = f (SH)
Where;
Dependent variable:
CG is Corporate Governance
Independent Variable:
SH is Stakeholders involvement/participation
Governance.
3.7 Technique of Data Analysis
charts.
following formula:
X2 = (fo - fe) 2
fe
fe = (rt) (ct)
gt
study.
3.8 RESEARCH THEORY
how people will behave -- everything else in between (like what the
would also say that the ultimate goal is to develop the law of
studies, we may learn that our theory doesn't fit the facts well and
quantitative research.
In addition, the proceedings from both study group and the
narrative approach.
following paragraphs.
turned in.
institutions.
Some of the data that should have aid the research work could not
and proper use of time. Therefore, with these measures put in place
the data gathered from the field is reliable and has significantly
eliminated or at least minimized the potential negative consequences
CHAPTER FOUR
institutes etc.
private sector in the sense that “Goods and Services that require
then Governor of Ogun State under the directives of the then Head
Liaison office and the golden edifice of the governor’s lodge unveiled
just one month to return of democracy, 27th April, 1999 under the
Olofin Moyin.
purpose the state liaison office was also created to assist indigenes
of the state and potential investor both within and outside the
country. She also offered protocol services and necessary hosting of
time.
LIAISON OFFICE
her operation was not known to anyone but its existence was quite
known. Studies have shown that it was due largely to the fact that it
was new and secondly because there were no structures to awaken
from the reason just mentioned, the transition from civil to military
rule which continued from 1983 through 1999 was another reason
for this; a time when citizens had no right to question the authority
of the Government.
etc in all sectors of the economy were the order of the day. This
trend continued throughout his 1st and 2nd term and the
the Liaison office. A turning point to say, when the activities of the
The committee came back with their report which was later
Commission) activities.
part of the Liaison Officer to really serve her people optimally. This
office both in Abuja and Lagos and also to supervise all other inter-
the liaison office said the idea behind the upgrading was to, among
the youths.
through which the liaison office projects the resources of the state
through the support of the liaison office. Aside from sourcing for
taxes.
its provisions. Moral and ethical values have since been redefined in
the agency. For the first time in the history of the Ogun state
report in the annual news bulletin of the state which just kicked off
was felt by the Ogun state executive council, lawmakers and the
Ogun State political imbroglio earlier this year; April 14, 2009.
4.1.2 OGUN STATE LIAISON OFFICE’S ORG. STRUCTURE
THE EXECUTIVE
GOVERNOR
SERVICO
AUDIT
M
COMMITT DIRECTOR GENERAL CHARTER
EE INTER-GOVERNMENTAL
AFFAIRS
LIAISON OFFICER (ABUJA) LIAISON OFFICER
(ABJ) (LAG)
EDUCATIO
INTERNAL INFORMATI
ACCOUNTI INVESTM MDGs N
AUDIT ON
NG UNIT ENT UNIT UNIT SCHOLARS
UNIT DIRECTORA
HIP UNIT
TE
EMPOWERME
TAX DESK
CORPORATE NT UNIT
SECRETARIATE
Figure 1: The Ogun State Liaison Office Abuja, org. structure
DRIVERS, SECURITY,
PriorSTAFFS,
KITCHEN to the period under review, the Ogun State ALL
Liaison
GARDENER AND DIRECTORATES/UNITS
Office like every
OTHERS (ABUJA AND other liaison office in the countryANNEXES
had no clearly
LAGOS)
defined structures. However, following the remarkable inputs of the
make her perform beyond her duty limit. However, her major task is
activities of the state are carried out successfully. She does this by
both in Abuja and Lagos including her special assistant and all other
directors work closely with her in order to see that the objectives
other administration lie the low level employees of the Liaison office
any organisation and of course the reverse can kill the smooth
running of an organisation. The liaison office for the first time apart
Ogun state liaison office. As we can see from the organogram, it has
link with all the various units of the organisation. It ensures that
the Ogun state liaison office. It’s also charged with the
audit committee.
LIAISON OFFICE)
creating capacity and activities, and that are therefore its potential
economy which allows for the influence and the interest of all
parties concerned.
• Not only short time problem solving but also longer time
orientation
• Durable commitment
• Shared responsibilities
• Societal legitimacy
Donor
Agencie
s
Pa vt.
r
Go
s
a stata
Suppliers/
l
Contractor
s
Ogun
state
indigene
Nigeria s
embassies
abroad
Potential
Internation investors
al
Embassies Other
in Nigeria Other states’
liaison Other govt
office categorie
s s
Figure 2: The Stakeholder Model of Ogun State Liaison Office
LIAISON OFFICE
governance, which has been defined as the way and manner in which
of reference:
practices.
liaison office.
Recall that we have stated earlier in this debate that the whole idea
findings, they set about crafting a Code of Best Practices for Ogun
stakeholders.
input before the Code was finalized. Subsequently, the final report
office are convinced that the adoption of this Code will no doubt
I.0 Introduction
quality of public services. Our public offices have for too long been
better!”
Abuja 19th – 21st March 2004 had once again informed the need for
I.II For the Ogun state Liaison office, the retention of public
embassies worldwide.
called Ogun State Liaison office only had verbal and non written
heads” and the decisions they make mostly are not their own and not
Liaison offices for all states, there had been a large gap between
review of the existing code for the Ogun state Liaison office. This
CONVICTIONS
That Nigeria can only realise its full potentials if citizens receive
RENEWAL
CONSIDERATION
For the needs and rights of all Nigerians to enjoy social and
economic advancement
AVOWAL
citizens
DEDICATION
To providing the basic services to which each citizen is entitled in a
Liaison office.
requisite experience.
(b) The Board should ensure that the value being created is shared
among the Ogun state indigenes and employees with due regard to
the interest of the other stakeholders of the liaison office. The
i. Strategic planning
executives
important stakeholders
vi. Ensuring that ethical standards are maintained and that the
5 persons in total.
entrepreneurial bias.
(e) The position of the Chairman and Chief Executive Officer should
power.
team.
decision.
training if necessary, and the liaison office should bear the expense.
(l) All directors should have access to the advice and services of the
followed and that applicable rules and regulations are complied with.
Board.
(c) The prime responsibility for good internal controls lies with the
Board.
office.
terms of reference, which deal clearly with its authority and duties.
C. THE TAXPAYERS
(a) The liaison office acting through the Directors should ensure
(b) Indigenes have right to question the steps taken by the liaison
office on certain matters that may affect them directly and suggest
ways of improvement.
before the meeting with such details (including annual reports and
audited financial statements) and other information as will enable
them to know the level at which the liaison office have served them.
leaders.
(f) The Board should ensure that decisions reached at the general
(g) The Board should ensure that all interest groups are treated
participation.
(i) The agency or the board should not discourage indigenes activism
(j) All benefits accruing from the liaison office must be shared
among indigenes on equal basis and not by any other measure such as
governance.
(b) The Audit Committees should not act as a barrier between the
(c) The Audit Committee should not be under the influence of any
Committee.
to the Committee.
Internal Auditor.
commences) the nature and scope of the audit, and ensure co-
iv. To discuss problems and reservations arising from the interim and
final audits, and any matters the auditor may wish to discuss (in the
management's response;
vi. To review the Company's statement on internal control system
management’s response;
E. FINAL NOTE
protected. But the issue is how many of them know their rights?
not know their rights, how can they know when there is infringement
overemphasized.
arrangement to look into their case, the affected parties either live
governance, it becomes easy for them to know when and where their
• Poverty Trap
people to compromise their moral values and do many things that are
corruption is, to say the least, deplorable and must not be allowed to
continue.
of tax or land rate and the agencies involved exaggerate figures and
5.1 Introduction
office, Abuja Nigeria. However, only four hundred and ninety eight
office Abuja
Presidency 33 7%
house, Abeokuta
Ogun state governor’s 60 12%
lodge, Abuja
Ogun state liaison 60 12%
office, Lagos
Ministry of works and 35 7%
housing
Ministry of 42 9%
information
Ministry of education 45 9%
Lagos state liaison 56 11%
office, Abuja
Kwara state liaison 56 11%
office, Abuja
Total 498 100%
SOURCE: field work conducted by researcher 2009
(highlights of poll)
performance.
a three legged chair that can not stand if the three are not present.
Option
Number Percentage
Yes 483 97%
No 15 3%
Total 498 100%
SOURCE: field work by researcher 2009
that fact.
practices?
practices
percent noted that the new corporate governance codes for Ogun
state liaison office may require a few changes and 11 percent noted
good governance.
levels are low. The remaining 22% are of the opinion that it’s high.
principle-based?
office, Abuja?
14% believe that all is well with the organisation as far as corporate
governance is concerned.
TABLE 7: Risk to CG
taxpayers
Total 520 100%
SOURCE: field work conducted by researcher 2009
office, Abuja and also key reasons for failures in the sector. 35
35 percent respectively.
viii. Research question eight:
against.
72% are of the opinion that other committees do not have high
they are equally impotant while the remaining 13% were indecisive.
think differently.
Proffessional
Satisfactory 254 51%
Low 184 37%
Total 498 100%
SOURCE: field work conducted by researcher 2009
Nigeria?
governance?
governance while only just 12% feel there are other factors order
events.
Nigeria?
respondents.
respectively.
state or not.
Are integrity and ethical values given due importance by Ogun state
improvement
Yes 244 49%
No 45 9%
Total 498 100%
SOURCE: field work conducted by researcher 2009
49% think Ogun state liaison office, Abuja has perfected in the area
b. investors
c. taxpayers
d. board of directors
specialist
investors 129 26%
board of directors 75 15%
Ogun state’s government 60 12%
Total 498 100%
Source: Field work conducted by researcher 2009.
Monitoring the effectiveness of corporate governance
restated below:
performance in Nigeria.
governance in Nigeria.
governance in Nigeria.
performance.
analysis thus;
Certificate
NCE/OND 95 9 104
HND/Degree 120 26 146
Masters & 171 15 186
above
Column Total 428 70 498
Fe)2/Fe
School 42 53.2851 -11.2851 127.3534 2.39
Certificate
NCE/OND 95 89.3815 5.6149 31.5271 0.35
HND/Degree 120 124.5984 -4.5984 21.1453 0.17
Masters & 171 159.8554 11.1446 124.2021 0.78
above
School 20 8.7149 11.2851 127.3534 14.61
Certificate
NCE/OND 9 14.6185 -5.6149 31.5271 2.16
HND/Degree 26 20.5221 4.5984 21.1453 1.03
Masters & 15 26.1446 -11.1446 124.2021 4.75
above
Total 498 498 0 26.24
Fe
Where:
F0 = Observed frequency
fe = Expected frequency
∑ = Summation
Grand total
Thus;
When f0 = 42
fe = 62 x 428
498
fe = 53.2851
when f0 = 95
fe = 104 x 428
498
fe = 89.3815
when f0 = 120
fe = 146 x 428
498
fe = 124.5984
when f0 = 171
fe = 186 x 428
498
fe = 159.8554
when f0 = 20
fe = 62 x 70
498
fe = 8.7149
when f0 = 9
fe = 104 x 70
498
fe = 14.6185
when f0 = 26
fe = 146 x 70
498
fe = 20.5221
when f0 = 15
fe = 186 x 70
498
fe = 26.1446
given below:
df = (r - 1) (c - 1)
df = (4 - 1) (2 - 1)
= (3) (1)
= 3
Decision Rules:
table value, then reject the null hypothesis (H0) and accept the
calculated chi-square (X2) value is less than the table value of a given
degree of freedom, then we accept the null hypothesis (H0) and
Decision:
of chi-square and the table value shows that the calculated value of
therefore, reject the null hypothesis (H0) and accept the alternative
governance in Nigeria.
governance in Nigeria.
analysis. Thus,
Certificate
NCE/OND 82 16 98
HND/Degree 132 28 160
Masters & 188 10 198
above
Column Total 438 60 498
The chi-square value is computed using the same formula
table 8
Fe)2/Fe
School 36 36.9398 -0.9398 0.8832 0.0239
Certificate
NCE/OND 82 86.1928 -4.1928 17.5796 0.2040
HND/Degree 132 140.7229 -8.7229 76.0890 0.5401
Masters & 188 174.1446 13.8554 191.9721 1.1023
above
School 6 5.0602 0.9398 0.8832 0.1745
Certificate
NCE/OND 16 11.8072 4.1928 17.5796 1.4889
HND/Degree 28 19.2771 8.7229 76.0890 3.9471
Masters & 10 23.8554 -13.8554 191.9721 8.0473
above
Total 498 498 0 15.53
When f0 = 36
fe = 42 x 438
498
fe = 36.9398
when f0 = 82
fe = 98 x438
498
fe = 86.1928
when f0 = 132
fe = 160 x 438
498
fe = 140.7229
when f0 = 188
fe = 198 x438
498
fe = 174.1446
when f0 = 6
fe = 42 x 60
498
fe = 5.0602
when f0 = 16
fe = 98 x 60
498
fe = 11.8072
when f0 = 28
fe = 160 x 60
498
fe = 19.2771
when f0 = 10
fe = 198 x 60
498
fe = 23.8554
df = (4 - 1) (2 - 1)
= (3) (1)
= 3
The calculated chi-square value is 15.53 while from the table, the
Decision:
between the calculated value of chi-square and the table value shows
validate all our hypothesis stated earlier in chapter one and restated
in this section.
senior managers know their job and have the best interests of
demonstrated.
packed board meeting calendar, may leave them with very little time
importance.
internal controls.
A problem known is a problem solved. Having identified various
there. This however, did not negate or render the inputs of the
researcher irrelevant.
CHAPTER SIX
6.1 SUMMARY
officers.
analyzed. The results of the analysis gave the true nature, level and
ups.”
We discovered that good corporate governance helps an
of stakeholder objectives.
organization’s reputation.
for Ogun state liaison office, Abuja, Nigeria (though, there are
regulations.
6.3 RECOMMENDATIONS
INDEPENDENT DIRECTORS
boardroom.
power.
group how they are performing and take tangible steps to improve
STAKEHOLDERS
taxpayers.
blowers.
AUDIT COMMITTEE
financial numbers
• The conduct of board meetings needs introspection in terms of
needs.
external auditors
improved.
Boards
and off the balance sheet, their ownership and how they are
mitigated.
management.
regarding their risk appetite in various areas and help ensure that
these are articulated and considered in design of controls, policies
and procedures.
Senior Management
making.
business units.
include:
ethical behavior
CHANGE:
performance criteria.
selection process.
measures.
effectiveness is demonstrated.
recommendations.
just to get big. The economics of large scale should reach the
entire economy.
staff.
work effectively.
6. Business journalists must themselves be trained so they can
information on organizations.
whom we do business.”
With the recent event in Ogun state liaison office now exported
corporate governance.
BIBLIOGRAPHY
Ibadan.
Cadbury Report on financial aspects of corporate governance,
(1992). London.
25 Issue 3, p88-106
Press.
Ihonvbere, J. O. (2005) “Consolidating the Reform Agenda”
http:/www.npa.net/rebuilding/consolidation.shtml.
Table, 320.
Office/September.
(ed).
(ed).
www.camagazine.com.
www.sisj.edu/faculty.
APPENDIX I
RESEARCH QUESTIONNAIRE
case study.
success.
Your responses will be treated confidentially for academic
purpose.
Thanks.
Yours faithfully,
_____________________
OTEGBOLA, O. A.
SECTION ONE
a. Male ()
b. Female ()
a. 20-29 ()
b. 30-39 ()
c. 40-49 ()
d. 50 and above ()
3. Educational qualification
a. School cert. ()
b. OND/NCE ()
c. HND/degree ()
b. Presidency ()
g. Ministry of Information ()
h. Ministry of Education ()
a. 5-10 ()
b. 11-20 ()
c. 21-30 ()
d. 31 and above ()
SECTION TWO
Yes ( ) No ( )
they be principle-based?
a. Principle based ( )
b. Regulations ()
c. Both ()
a. management override ()
b. Inadequate independence ()
Yes ( ) No ( )
12. How do you rate the skill-sets of the existing audit committees
a. Highly Professional ()
b. Satisfactory ()
C. Low ()
Nigeria?
Yes ( ) No ( )
a. fully responsible ()
b. partly responsible ()
c. not responsible ()
16. How would you rate the current standards of risk management
Nigeria?
Nigeria.
Nigeria so far?
19. Are integrity and ethical values given due importance by Ogun
b. investors
c. taxpayers
d. board of directors