Recent discussions, led by Professor Fabian Ajogwu at Lagos Business School, focus on enhancing corporate governance in Nigeria. This initiative aims to tackle persistent issues like corruption and lack of transparency, which hinder economic growth. Ajogwu’s AFG Model seeks to balance profit with ethical leadership and social responsibility, promoting a shift from mere compliance to fostering a culture of accountability.
Experts have recently reignited discussions surrounding acceptable corporate governance culture in Nigeria, marked by a significant event at the Lagos Business School. Here, esteemed governance experts convened to address the prevalent issues affecting the Nigerian corporate landscape, underscoring that poor corporate governance is a recurrent challenge amidst the nation’s economic difficulties.
The systemic issues identified are extensive, demonstrating that while larger firms may establish effective governance measures, smaller businesses often struggle, leading to a troubling statistic where many fail by their fifth year. Effective governance is deemed critical for corporate success, guiding conduct and organizational direction, as suggested by the Corporate Finance Institute.
Corporate governance challenges in Nigeria include corruption, inadequate regulatory frameworks, and poor enforcement, which collectively stifle economic growth and erode investor trust. The consequences of these issues manifest in numerous financial scandals, loss of public confidence, and significant losses for both investors and employees, resulting in a stagnant business environment characterized by accountability deficits.
At the Lagos Business School, Professor Fabian Ajogwu unveiled the AFG Model during a public lecture focused on ‘Balancing Power, Profit and Purpose.’ This model is designed to assist organizations in effectively navigating the complexities of contemporary business governance. Ajogwu’s insights emphasize that corporate governance should transcend mere compliance, promoting a culture of integrity and accountability.
The significance of corporate governance was further stressed by Dr. Peter Bamkole, who remarked on its essential role in fostering responsible leadership and economic sustainability. The discourse highlighted a common misconception that good governance equates to mere checklist compliance, whereas it is fundamentally about nurturing accountability and ethical practices within organizations.
Professor Juan Manuel Elegido noted that Ajogwu’s work challenges readers to appreciate the broader implications of governance principles, which extend beyond adherence to regulations to encompass the cultivation of a trustworthy corporate culture. Furthermore, the Chairman of Stanbic IBTC Holdings Plc, Sola David-Borha, emphasized the integral role of individual character in reinforcing governance standards.
Addressing contemporary challenges, Ajogwu articulated a paradigm shift in governance that balances profitability with social responsibility and sustainability. He posited that the evolving nature of corporate governance necessitates an integration of environmental, social, and governance (ESG) factors, aligning business practices with societal needs. This model advocates for ethical leadership and stakeholder engagement as vital components of successful governance strategies.
Ajogwu argued against a narrow focus on profitability, positioning the company’s role within a broader context of purpose that encompasses ethics and sustainability. He introduced the concept of the ‘4 Ps’ of corporate sustainability, which includes people, planet, purpose, and profit, encouraging businesses to evaluate their long-term impact.
Crucially, Ajogwu highlighted the importance of the rule of law and anti-corruption measures in ensuring effective governance. He explained that a solid legal framework fosters accountability and ethical decision-making, while corruption undermines governance structures, necessitating proactive approaches to transparency and internal controls within organizations.
The ongoing dialogue surrounding corporate governance in Nigeria emphasizes the critical need for effective practices that prioritize accountability and ethical leadership. The introduction of the AFG Model by Professor Fabian Ajogwu serves as a progressive framework for organizations to integrate purpose with profitability, thereby addressing prevalent challenges such as corruption. The evolution of corporate governance is essential for nurturing investor confidence and fostering economic growth, ultimately contributing to the broader development of the Nigerian landscape.
Original Source: www.thisdaylive.com
