A CEO shakeup has commenced in the insurance industry ahead of the release of draft guidelines on corporate governance code for managing directors and executive directors, expected to affect those that have spent 10 years on the job.
“We are working on it and the draft will be exposed to operators soon for their inputs. Don’t forget that we also need to get necessary approvals from our supervisory ministry,” a source at the National Insurance Commission (NAICOM) said.
Already, Ebelechukwu Nwachukwu, managing director, Zenith General Insurance has been asked to go, while managing directors of NSIA Insurance, Chioma Sideso and Anchor Insurance Company Limited, Mayowa Adeduro are all going any moment from now. Fatai Lawal of Sterling Assurance has also spent 10 years.
If the industry regulator, the National Insurance Commission (NAICOM) can pull the string and implement the planned sector corporate governance code, which has faced fierce resistance from operators, no fewer than five owner mangers will also go.
READ ALSO: What consumers will want to see from insurers post covid-19 era – NAICOM
Among owner-managers who have spent over 10 years as CEO’s of their firms include Biyi Otegbeye of Regency Alliance; Oye Hassan-Odukale of Leadway Assurance, Eddie Efekoha of Consolidated Hallmark Insurance; Tope Smart of NEM Insurance; Sakiru Oyefeso of Staco Insurance.
Industry analysts who have analysed the situation said if the code pulls through, the industry will wear a fresh look with a new set of managers, but fears that expected new managers may have limited powers to do quite a lot of things.
“We have today many employee managers who still refer to their non-executive chairmen for approval of certain amounts, and this is not good for the industry,” the analysts said.
“This is what should happen for the industry to move forward and compete with other financial services sectors in the market, but I am afraid it will bring a lot of instability unless the regulator will have to do extra work in oversight functions,” the analyst also said.
Obinna Chilekezi, insurance consultant and lecturer at the West African Insurance Institute, the Gambia said the retirement of owner-managers all over the world happen naturally, and due to the need to inject new and fresh ideas it has become necessary for the industry at the moment.
“I will not like it to be by coercion because I do not know if NAICOM will succeed with it. I fear that NAICOM may not have the legal backing to enforce that,” says Chilekezi.
He stated that the best way to go about it is to sensitize the industry on the need to bring in fresh and younger managers with new ideas that can move the industry forward.
“With proper sensitization, it should be at the discretion of investors, directors and shareholders in case of publicly quoted companies,” he stated.
READ ALSO: At 60, Nigerian Insurance industry still grappling with low penetration
Mohammed Kari, Commissioner for Insurance and CEO of NAICOM said the Commission has resolved to expose the draft of the revised Code of Corporate Governance to all stakeholders. “Not only have we always resisted change as an industry, but we have also actually fought against it, sometimes with silly arguments of being different or requiring more time to do what other sectors have achieved overnight.”
Kari said the Commission is hinging its position on the need to achieve transparency, efficiency and best global practice that could place the local industry side-by-side with its counterparts in developed economies.
NAICOM had in 2016 enforced the corporate governance code concerning non-executive directors, and this has been compiled by the industry.
Specifically, section 5.04 (vii) of the 2009 corporate governance code stated “non-executive directors shall not be re-nominated and appointed for more than three terms of three years, and on implementation, no fewer than 150 non-executive directors left the industry.
MODESTUS ANAESORONYE
