Good corporate governance and proper succession planning are key drivers to the survival of indigenous firms and building trust in corporate Nigeria.
Olakunle Alake, group managing director of Dangote Industries Limited, Olakunle made this assertion while delivering a paper titled ‘Corporate Governance and Succession Planning’ at the 35th Omolayole Management Lecture Series organised by AIESEC Alumni Association in Lagos
He said that the absence of sound corporate governance structures and good succession planning are reasons indigenous companies hardly outlive their founders.
Alake said many great indigenous businesses collapsed partly because of effective corporate governance structures and succession processes were not put in place to ensure that these businesses were sustained.
“For businesses with poor corporate governance structures, the founder was often the chairman and the chief executive and made all decisions. They believe in owning all without a thought for tomorrow. He alone had the vision, energy, strategy and ran the business. When the man died, the business died,” he said.
However, the Dangote Group helmsman pointed out that with a good board, sound corporate governance structures and proper succession planning, the founder can retire without looking back and the company will continue to thrive because there would be transferred vision and goals.
“There would be effective corporate governance and shared operational sustainability. These are fundamental reasons why a business must have a proper and effective board,” he said.
Alake recalled that in the period of the early 70s and late 90s, several Nigerians held sway at the top of many blue chips and they adopted sound corporate governance practices and implemented credible succession plans, which was why many of them still exist till date.
Giving an instance of Dangote group as a multi-national with corporate governance and succession plan in place, he said a lot of people assume and wrongly so that the Dangote Group business is a family business and therefore operates completely as such.
Contrary to such view, he said, Dangote is a well- structured business with a lot of professionals responsible and accountable for key aspects of the business and who have no family relationship with the founder.
Earlier speaking, Olukunle Iyanda, president and chairman, Nigerian Institute of Management( Chartered) (NIM), noted that good corporate governance is extremely necessary for building trust in corporate Nigeria
He said that currently, Nigeria is facing a trust deficit that is cutting across both public and private sectors. This trust deficit is due to the abuse of trust and has to be rectified through good corporate governance.
In her address of welcome, Brenda Nwagwu, president of AIESEC Alumni Association, noted that the lecture series has served as a veritable source of quality management education and insight for Nigerian professional managers.
