The Minister of Finance, Kemi Adeosun, yesterday, described Nigeria’s 64th ranking among 140 countries on the protection of minority shareholders interest as gladdening, when compared with China, 71st; Brazil, 78th; and Russia 116th respectively in the latest World Economic Forum ranking index of 2013/2016.
The minister stated this in a keynote address to the inauguration of the Study Team on “Voice and Voting Power – What Role for the Retail Shareholders in the Nigerian Capital Market” in Abuja.
The world Economic Forum index ranks countries yearly based on the strength of investor protection as well as on the protection of minority shareholders interest.
Represented by the Permanent Secretary in the Ministry, Mahmoud Isa Dutse, the minister said, “Although we lag far behind South Africa which ranked 3rd globally, I therefore hope that this Study Team will look closely at best practice in other jurisdictions and how it could be applied to ensure stronger protection of minority shareholders in Nigeria.”
She added that despite the achievements recorded in the sector by the Securities and Exchange Commission in different areas in the market, efforts must be expedited to bring back minority shareholders and retail investors who fled the market following the painful market decline in 2008.
She charged the Study group to address the challenges of effectiveness of enforcement of rules and regulations, that the shareholders should not be made so powerful that they can constitute themselves into a ‘’Checkpoint’’ for the extraction of rent from company management.
She reiterated that Nigeria needs retail shareholders with sufficient voice and voting power to ensure that corporate governance codes are effectively implemented to enable quoted companies access larger funding and achieve higher valuation of corporate assets.
Assuring active shareholders’ associations would also bring about greater hoper for effective implementation of the corporate governance framework, guaranteeing and encouraging many more investments on the stock exchange, she noted.
