Recent discussions at the Lagos Business School emphasized the urgency of improving corporate governance culture in Nigeria due to historical inadequacies that hinder economic growth. Experts, including Professor Fabian Ajogwu, presented the AFG Model aimed at integrating ethics and accountability into corporate practices. Notably, guidance under the rule of law and anti-corruption frameworks is essential for any meaningful progress.
Recent discussions at the Lagos Business School emphasize the crucial need for enhanced corporate governance culture in Nigeria, amidst a backdrop of historical failures. Experts agree that poor corporate governance remains a significant barrier to economic growth, as companies often prioritize rapid expansion over governance, leading to financial mismanagement and a deteriorated trust from investors.
Corporate governance encompasses the rules and practices that dictate how companies are directed and controlled. Its importance is underscored by the Corporate Finance Institute, which notes that effective governance shapes organizational conduct and overall direction. Although large firms can implement governance measures, small enterprises frequently struggle, contributing to their early failures.
Acknowledgment of the value of good governance has gained traction among both elites and the general populace in Nigeria. However, challenges such as corruption, ineffective regulations, and inadequate enforcement pose risks to economic advancement and investor confidence. A persistent lack of governance has resulted in scandals, as evidenced by incidents involving Cadbury Nigeria and bank failures, which often stem directly from insider misconduct and regulatory lapses.
The repercussions of poor governance extend to tax evasion and misallocation of funds that deprive the government of essential revenue, resulting in economic instability and lost investments. Furthermore, stakeholders—including employees—suffer through job losses and exploitation, leading to an overall business environment that is stifled by a lack of accountability and ethical leadership.
The recent public forum at LBS, led by corporate governance expert Professor Fabian Ajogwu, scrutinized these issues while presenting his AFG Model designed to enhance governance structures. The event highlighted the necessity for organizations to balance profit, power, and purpose, as emphasized in Ajogwu’s latest book titled ‘Reflections on Corporate Governance.’
Dr. Peter Bamkole, Deputy Vice-Chancellor of Pan-Atlantic University, acknowledged the significance of corporate governance in achieving organizational success and accountability. Ajogwu challenges the notion that governance is merely a checklist, advocating instead for a deeper understanding of its broader implications on corporate culture and ethics.
Prominent figures articulated the essence of character in governance, as noted by Sola David-Borha, who emphasized the intrinsic motivation behind ethical behavior. The dynamic business environment necessitates adaptive governance strategies that not only address the operational landscape but also integrate environmental, social, and governance (ESG) factors into decision-making processes.
Ajogwu contends that effective governance should extend beyond the pursuit of profit into the realm of purpose-driven business practices. He promotes a model that prioritizes stakeholder engagement and aims to restore public trust. By reducing the emphasis on profits alone, he advocates for the inclusion of social responsibilities, ethics, and sustainability into corporate frameworks, thus highlighting the interdependence of economic and social imperatives.
To ensure success, Ajogwu stresses that governance frameworks must incorporate both the rule of law and anti-corruption measures. The rule of law serves as a foundational element guiding ethical governance and reinforcing institutional credibility while addressing the challenges posed by corruption, which threatens economic stability and ethical leadership.
The discussions at the Lagos Business School have reaffirmed the critical need for improved corporate governance in Nigeria, underscoring its role in fostering economic stability and investor confidence. By adopting the AFG Model, organizations can align their practices with ethical standards and a sense of purpose, rather than solely focusing on profitability. Effective governance that incorporates the rule of law and anti-corruption measures will significantly enhance the business landscape while safeguarding stakeholders’ interests.
Original Source: www.thisdaylive.com
