EcoBank Board Indicted, SEC Calls For Special AGM

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The last may not have been heard of whiff of financial impropriety within the corridors of EcoBank as the Securities and Exchange Commission (SEC) has indicted the board of Ecobank Transnational Incorporated (ETI) in its investigation conducted to ascertain the level of the unethical allegations against them.

SEC commenced the investigation last year following series of publications in the local and international media regarding breaches of corporate governance and allegations against the board of directors and some principal officers of Ecobank Transnational Incorporated (ETI) and the findings made from the investigations prompted the then MD/CEO of the bank to resign. The bank is listed on the Nigerian Stock Exchange.

A statement from the SEC on Wednesday said the, “Securities and Exchange Commission (“SEC” or “the Commission”), pursuant to its core mandate of fostering the integrity of the Nigerian capital markets and ensuring adequate protection of the investing public, commenced an investigation into the alleged breaches and corporate governance practices within ETI in August 2013.

The commission also engaged KPMG to supplement its efforts and make recommendations on the way forward.

“The gaps identified from the review are the absence of a clear vision and strategy to drive the institution; inadequate transparency in the recruitment procedures and mechanisms for board members and executive staff which fostered conflicts of interest, weaknesses with respect to the tone-at-the-top; governance culture, communication, remuneration for board members and executive level personnel, decision making, absence of dedicated channels for whistleblowers to report instances of anomaly, and the often compromised autonomy of governance mechanisms such as internal control, and the audit and compliance committee of the board.”
The board’s specific weaknesses include: its ability to manage its own activities; the board’s role in monitoring management and evaluating its performance against defined goals; its role in overseeing the achievement of ethical behaviour in the organisation; and its responsibility towards shareholders and other stakeholders and accountability for their interest.
Sequel to the findings of the audit, SEC held a meeting with members of the board of ETI on Monday, 16th December, 2013 during which the results of the exercise were presented. The commission believes that ETI will need to appoint a substantive board chairman who will lead the effort to attain an improved governance climate.