Capital market stakeholders have called for a judicious approach by government and law enforcement agencies in handling corporate matters in order to avoid unintended negative consequences.
Shareholders and experts said government agencies should avoid sending wrong signals to the investing public, contrary to the efforts by the government to woo foreign and domestic investors in rejuvenating Nigeria’s economy.
They said while nobody should be above the law, government agencies must not be seen to be playing to the gallery or unguarded when it comes to corporate matters as this could lead to undermine confidence in the economy.
They spoke on the background of the recent raid of Dangote Group headquarters by the Economic and Financial Crimes Commission (EFCC). EFCC is conducting investigations into foreign exchange allocations and usage by some 52 companies.
Dangote Group had clarified that it had provided part of required information to the agency and requested for extended time to comply with the required information, spanning 10 years. Officials of the agency however decided to visit the Dangote headquarters for the same documents reportedly submitted to their office.
Managing Director, Highcap Securities, Mr. David Adonri, said such investigations on economic issues involving large corporates like Dangote Group should have been handled with utmost consideration.
According to him, the capital market is highly sensitive to information and there could be unintended negative consequences to less thought-out actions of government agencies.
“Anything concerning Dangote affects investors in particular and Nigerians in general. His matter is very delicate and must be handled discreetly. The highly publicised raid on headoffice of Dangote Group is capable of eroding investors’ confidence in the economy and unsettling stability of the capital market. Dangote Industry occupies the commanding height of the Nigerian economy right now. If it is not carefully handled, Nigeria will be the loser,” Adonri said.
President, Association for the Advancement of Rights of Nigerian Shareholders (AARNS), Dr Faruk Umar, said the government should exercise caution in the way and manner it intends to carry out investigations on the activities of the past administration of the Central Bank of Nigeria (CBN) in order not to avoid undue sensationalism.
He noted that President Bola Tinubu has been making laudable efforts to increase foreign direct investments into the country and as such, government agencies must not be seen to be working in contrary to the overarching agenda of the government.
“While we encourage the government to ensure it recovers all funds that might have been mismanaged, if at all, due process must be adhered to,” Umar said.
He pointed out that Alhaji Aliko Dangote has helped in developing the Nigerian capital market and the economy and he has demonstrated commitments to highest corporate governance ideals by opening up his companies to the general investing public and public scrutiny through listing at the stock market.
“His companies constitute the highest capitalisation in the Nigerian market. He is the largest employer of human capital and a very good Ambassador of Africa. We wonder what the raid of his offices had achieved, apart from just embarrassing him and the numerous shareholders, staff and management of our companies,” Umar said.
National Coordinator, Pragmatic Shareholders Association of Nigeria, Mrs Bisi Bakare, said shareholders have implicit confidence in the operations of the Dangote Group and commended the commitment of Dangote Group to providing necessary information to the EFCC.
“Dangote Group is one of the most respected companies in Nigeria. They are the largest employer of labour from the private sector, highest contributor to tax in Nigeria and highly capitalised stocks in Nigerian Exchange. Therefore, we, as shareholders, have 100 per cent confidence in Dangote Group to defend themselves before EFCC on any matter requested by them,” Bakare said.
She pointed out that stock market reactions so far confirmed investors’ confidence in Dangote Group, adding that the investing public “entertains no fear until conclusion of their investigation”.
President, Independent Shareholders Association of Nigeria (ISAN), Mr. Moses Igbrude, expressed optimism that the matter would soon be resolved.
According to him, while Dangote Group has other private companies, the group’s tendency to list its companies underline a commitment to public accountability and wealth transfer.
He noted that all quoted entities are well-regulated, “which means their accounts are subjected to public scrutiny” as a “quoted company is a public wealth managed and run by a board on behalf of the shareholders, which is different from the owner”.
“I also believe that whatever that is currently going will soon be resolved,” Igbrude said.
President, Ibadan Zone Shareholders Association (IBZA), Mr Eric Akinduro said all players in the economy must adhere to the rule of law and best practices.
SOURCE: THENATION
