Abstract

In recognition of the fact that weak corporate governance had contributed to recent
corporate failures in Nigeria, the Securities and Exchange Commission (“SEC”) in September 2008
inaugurated a committee to review the 2003 Code of Corporate Governance for Public Companies in
Nigeria in order to address its weaknesses and improve the mechanisms for its enforcement. A new
code of corporate governance was published in February 2011 and came into effect from April 2011.1
The provisions of the Code state in Pt A that it is not intended as a rigid set of rules but rather as a
means of defining minimum standards of corporate governance particularly for public companies
listed on the stock exchange.2 The Code contains explicit provisions relating to different aspects of
the company board and its committees, but of particular interest in this article is Pt B s.4, which deals
with the composition of the board. In addition to the usual requirements such as that boards should
comprise a mix of executive, non-executive and independent directors, the Code states in s.4.4 that
“The members of the Board should be individuals with upright personal characteristics, relevant core
competences and entrepreneurial spirit … .” This provision clearly emphasises the importance of the
personality of board members, and highlights the notion that competence and entrepreneurial
know-how would not suffice for board members who are expected to effect adequate corporate
governance.