The Nigerian insurance regulatory authority, the National Insurance Commission (NAICOM) is worried about the adverse effects of poor corporate governance in the sector and has threatened to blacklist such persons when caught.
Commissioner for Insurance, Mr. Sunday Thomas who revealed this at a seminar for insurance journalists in Lagos over the weekend, said this is how corporate governance i now being abused in the industry.
He raised concerns that these people who hold positions that are unknown to the commission in the various insurance companies are causing problems and de-marketing the industry.
He said: “Corporate Governance issues in the industry have to be revisited and probably sustained. There is a popular saying that applies all over the world that companies don’t die, people kill companies. There are people behind every fraud and other malpractices that you hear of. Some big names of companies that are doing well are run by human beings. These companies are still alive and running because of effective governance system. Let us bring this home to Nigeria and use Leadway Assurance which is owned by a family as an example. The company was established by a human being who is late now but the company is still alive and doing well. But we have another company also owned by a family that is gone and dead today. The difference governance between the two companies are issues bothering on good corporate governance and bad corporate governance.
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“So, we are going to continue to remind the industry that part of our regulatory assignment is to pay attention to governance issues. I want this noted and I am saying it emphatically that we will deal with those people that companies introduce into the structures that are not known to the commission either called overseer or just a name coined to suit them and are performing critical roles through superintending and in the process causing problems.
“In the course of our inspection, if we get hold of anybody participating directly or indirectly in the decision-making of the organisation, we will ban the person from getting involved in insurance in this country and we will extend it to other financial services sector. Within the powers given to us as regulators, we will make sure that the person does not come close to the company and any insurance company in the industry and we will extend it to other financial institutions.
“We can do this because we have engagements where verifications are done to characters of people who sit in board position in the sector. We will open our book and blacklist such people. And anytime we have to make comments on such people, we will never recommend that person for any position in the financial service sector. It is important because this is the way governance is now being abused in the sector where unknown persons will just be introduced and will be causing problems all over the place.