Rabiu Olowo, executive secretary and CEO of the Financial Reporting Council (FRC), has urged Small and Medium Enterprises (SMEs) in Nigeria to embrace sound corporate governance practices as a vital strategy for business growth and sustainability.
Speaking at a stakeholder forum organised by the FRC in collaboration with the Lagos Chamber of Commerce and Industry (LCCI) and the Integrity Organisation, Olowo stressed that poor governance remains a major reason why many SMEs in Nigeria fail within a few years of operation.
The event focused on the theme, “Corporate Governance Certification as a Key Strategy for MSME Success in Nigeria.” Stakeholders in attendance emphasised that without strong internal systems and proper accountability, SMEs are likely to collapse despite having promising business models.
“Governance is the foundation,” Olowo said. “Having good governance for your business is a source of advantage. SMEs are vital for public inclusivity and growth. We must support the SMEs for economic growth.”
He revealed that more than 50% of SMEs fail in their first year, and up to 95% shut down before reaching five years. According to him, good governance is not a luxury but the invisible structure that enables SMEs to manage risk, increase accountability, and improve overall resilience.
Echoing this view, Soji Apampa, CEO of Integrity Organisation, said the tendency of some SMEs to prioritise personal networks over regulatory compliance weakens trust in the business environment. “Integrity is no longer just the right thing to do. It is how smart businesses succeed,” he said. “SMEs must prove their competence, not just claim it.”
Apampa added that corporate governance certification, even though voluntary, helps business owners discover areas for improvement. “The certification brings about integrity. It uplifts your business,” he said, urging SMEs to leverage support from institutions like the FRC and LCCI.
Also speaking at the event, Gabriel Idahosa, LCCI president encouraged SMEs to register with credible associations and build networks that support sustainable growth. He advised business owners to prioritise long-term value creation over short-term gains.
“We want SMEs to think long-term. That is how we build sustainable businesses. Join associations like LCCI so we can connect you with investors who want to work with serious, certified businesses,” Idahosa said.
The event concluded with a collective call for stronger support frameworks for SMEs through improved governance, certification programmes, and institutional partnerships. Stakeholders expressed optimism that initiatives like the corporate governance certification will help Nigerian SMEs build resilience, attract investment, and scale their operations successfully.
