The Institute of Directors (IoD) Nigeria as a business membership organisation (BMO) has been in existence for 35 years with over 4,000 career directors as members. The DG/CEO of the institute, Dele Alimi, who assumed duties in that capacity in August, 2017, in this interview with SEYI JOHN SALAU spoke about the annual directors’ conference, a flagship programme of the institute and what the IoD is doing as regards corporate governance. Excerpts:
As the Director-General and Chief Executive Officer of IoD Nigeria, what would you say are the major contributions of the institute to the economy?
The institute of directors is a prime membership organisation in Nigeria and it basically focuses on capacity development for directors, improving their abilities to deliver on the various mandates they have been given in the various boards, ministries, departments, and companies they are directing. The role of a director is different from that of a manager.
The director is like the overall person who gives direction on the way the company should run, so not only do we deal with executives who are managing directors or executive directors, we also have directors who are just on board that is, the non-executive directors and we have independent directors. So, what we do is to prepare them in terms of their capacities and abilities to properly manage organisations. The implication is that when organisations are properly managed, it has a positive effect on the economy, employment and social aspect of the country.
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The institute is striving in all areas to make the Nigeria economy viable and useful for everybody. So I believe that when directors show signs of good leadership, organisations will be sustainable. When organisations are sustainable, employments will always be retained and new jobs will be created.
Chartered Directors are recognised anywhere there is IoD. How far has IoD Nigeria gone in establishing Chartered Directors?
To have chartered director, the first thing you must do is that the institute itself must be chartered. As I speak with you, IoD Nigeria has gone very far. This is a race that started about three to four years ago. By the grace of God, we are at the last lap of getting a chartered status for IoD Nigeria. Once we have a chartered status, in the house, we will roll out our plans to ensure that we have chartered directors in Nigeria. We are hoping it happens before the end of the year.
Recently, the institute launched the Code of Ethics Committee. What informed it and how is the committee going to regulate activities of directors in their various organisations?
The idea of setting up an ethics committee is for members of the institute. We also ensure that our members at all-time are above board in their dealings and activities. Also, in playing properly the roles they have been given as directors.
We believe that if we put this code in place, it will transcend any sector. It is a code that will guide directors. Our aim is not to be punitive. We will give you a code that will spell out your responsibilities. We believe that at any point in time, you have issue; we will give you what to do in terms of blowing the whistle.
The whole idea is that as a member of IoD, there is a particular level of standard that is expected of you and if you fall below it, there will be sanction. Also, the reason why I said it is not going to be completely punitive in nature is that when we notice that a member is erring, standing on the existing ethics code that we have, we can write the member. The institute believes those actions you have taken is contrary. So, it is also going to be advisory in nature and that will not be within our control. Our code of ethics is within our control.
We are not going to be waiting on government and regulatory authorities. We will have our own committee. For instance, Institute of Chartered Accountants of Nigeria (ICAN) has its own disciplinary committee no matter what the court does. Once a member is reported, ICAN has a way of disciplining such member. We have seen members whose certificates were withdrawn and removed from the register of ICAN. This ethical conduct will ensure that members are able to live above board as the conducts are concerned.
The annual Directors’ Conference is the institute’s flagship event. What are you doing differently this year?
The conference opened on November 8, at the Transcorp Hilton in Abuja, with the theme: ‘Global Best Practice in Corporate Governance: Way Forward for Nigeria’. From the theme, you will realise that we are still demanding more in terms of the need for Nigeria to embrace more the spirit of good corporate governance. What we did this year is that we looked at the global best practices, where it has been done and has been done right; bringing people to come and discuss that.
We had foreign speakers from climes where internationally they have been acclaimed to have very good corporate governance codes that is working and working very well for them. We had them here to learn from experiences.
We also had Nigerians who are in charge of implementing our codes, or contributed to our own governance code discussing the issues of corporate governance code. It was a one-day programme. Not only did we examine the issue ourselves, we also looked at other places where they seem to be doing it better than we are. The Vice President was the special guest of honour and the keynote address speaker was Prof. Bola Akinterinwa. He has written so much on leadership, especially as it affects Nigeria and you have the Chief Executive Officer, IoD Mauritius. Mauritius is regarded as one of the countries in Africa with the best corporate governance codes. It is working very well for them, if you look at the ease of doing business; they are even ahead of us. We brought in the CEO of Mauritius IoD to talk about their own experience, about how they were able to entrench corporate governance code and how they were able to work in their country. Part of our speakers is the President, Nigeria Stock Exchange, Bimbo Banjo; the Head of Civil Service, Eyo-Ita; the Chairman Financial Reporting Council, and Dotun Suleiman.
What is the institute’s role in corporate governance practice and how does that differ from management’s role?
The roles are quite different. You have different categories of staff and workers. In many organisations, you have what is called junior and senior staff. There are management staff and directors. At each level, there are expectations.
There are job descriptions, there are Key Performance Index (KPIs) and everyone has a role to play. But then people look more to the top, where strategy resides; this is where the difference between the director and the manager comes in.
It is believed that at the director level things are going well, it is most likely that they will hire the right set of mangers who will be the vision drivers. So the directors are the vision drivers. They set the standard and the strategy. Then they brought it down to the management level that implements. They continue to evaluate and review what management is doing. So, if you have at that level people who are well trained, with the capacity and experience to deliver, there is the likelihood that management will be well guided. So, the directors guide the managers to deliver on the set strategies put together by the directors.
The directors can be divided into executive directors which include the managing director and other executives who are part of the day-to-day running of the organisation. Then, the board who are non-executive directors, the board comes in daily, but their liabilities are now so large that you cannot be an executive director and say I don’t know when they were doing this.
The rule now takes everyone into consideration. So as a non-executive director, it is important you know what is going on. You must get the facts behind the figures. Directors can now go to jail when companies are not well managed. This is how the practice has gotten to now. Non-executive directors can now go to jail.
Various sectors have their regulatory bodies. Even quoted companies, there are new sets of guidelines from the Stock Exchange Commission (SEC), people are now expected to do due diligence on their companies.
So, when any company invites you to their board, you need to do due diligence on their board and if you are on their board, then you see things are going wrong, you need to blow the whistle to let everybody know. This is part of the role IoD plays to prepare directors. We have had people who have been appointed to board who are fresh and have come for training here, and when we told them what they needed to know, they were quite happy and appreciated us.
