The Nigerian Communications Commission (NCC) said it was working on additional guidelines for its corporate governance code for the telecommunications sector.
Specifically, the telecoms regulator said the guidelines to be added would address the lingering problem of interconnection debt between operators and the issue of multiple mandates. Interconnection debt between operators is believed to have reached over 70 billion naira last year.
A recent audit of the financial health of telecommunications operators by NCC reportedly raised more concerns about the capital structures and unsustainable debt ratios of a substantial number of operators.
While noting that the Nigerian Corporate Governance Code requires sector regulators, in collaboration with the Financial Reporting Council of Nigeria (FRCN), to issue additional guidelines, NCC said the additional guidelines being developed solve the problem of interconnection debt between operators. This, he said, became imperative to prevent one of the telecommunications companies from collapsing under the weight of debt.
According to the Commission, at the start of telecommunications liberalization, the regulator paid more attention to the widespread deployment of telecommunications infrastructure, access to telecommunications services and technical regulation. “In this regard, the Council has published regulations and guidelines in the areas of quality of service, mobile number portability, numbering, frequency pricing, installation of pylons and pylons and interconnection.
The technical regulation approach has led to phenomenal and well-documented successes in the industry, ”said the Commission. to avoid the boom and bust cycle already seen in other sectors.
NCC had, in 2016, revisited the Code of Corporate Governance of the Telecommunications Industry and left the freedom to the telecom operators to operate it as a non-mandatory code for a period of one year. In 2017, NCC made the code mandatory, designed to create transparency and business growth in the telecommunications industry.
One of the key elements of the Code is that the offices of the President and that of the CEO should not be occupied by a single person simultaneously in a telecommunications company in Nigeria. In addition, no one can hold a director position in a telecommunications company for more than 15 years. Commission Executive Vice-President Professor Umar Garba Danbatta recently said that the Commission believes that a good
corporate governance was essential for meaningful economic growth and development, especially for an industry as dynamic and complex as telecommunications. According to him, this is why NCC published the Corporate Governance Code for the Telecommunications Industry in 2014 and made it mandatory for its larger licenses in 2017.
In addition to the industry-specific code, the Financial Reporting Council (FRC) also last year issued the Nigerian Code on Corporate Governance (the Code). The Code highlights the key principles that seek to institutionalize best corporate governance practices in Nigerian companies. The FRC code comes into effect from January of this year.
According to NCC, although both codes had the same main objectives of improving the performance of the company through adherence to best practices, it was natural that there were areas of divergence, that the Commission and the FRC would work on. harmoniously together to deal for the overall benefits of the country.
“We understand that the national code will exist simultaneously with sector codes such as the NCC code, which will now be described as ‘guidelines’.
“In the event of conflicts between the two codes, the more stringent provisions will apply and the FRC National Code gives flexibility to sectoral regulators such as NCC to tailor governance principles to the particular needs of the sector,” he said. ‘EVC.
Also speaking about the need for collaboration for the implementation of the two codes, the Executive Secretary / Director General of the FRC, Mr. Daniel Asapokhai, said: “Although we have the national code, the sector code is also recognized. ; we only need to work harmoniously to ensure that we collectively achieve our goal of ensuring the survival of more Nigerian businesses by making them more resilient through corporate governance codes and, ultimately, we ensure that we make our economy more attractive to investors; as such, we need to collaborate more as organizations.