Overview of Nigeria’s Corporate Governance Regulation
The Companies and Allied Matters Act1 is the basic law that regulates the legal existence and operation of all companies in Nigeria. However, there are other laws which apply to companies depending on whether they are private or public companies; or operate in regulated industries such as banking,2 insurance3 and pension4 industries, and the capital market.
In addition, some industry regulators have established codes of corporate governance for their respective industries to provide additional clarity on the duties of and the expectations toward directors.
Thus, Nigeria’s corporate governance system is a combination of voluntary and prescriptive principles. The Companies and Allied Matters Act, along with the other applicable laws and codes of corporate governance regulate the membership, structure and activities of the board of directors. Common law and equitable principles as it relates to agency and trusts also inform the construction of the duties of directors both individually and as members of the board.
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“Original source of publication: Directors’ Liability: A Worldwide Review Third Edition, Alexander Loos (Ed.), International Bar Association Series, Volume 22, © 2016 Kluwer Law International BV, The Netherlands.”
1. CAP C20 Law of the Federation of Nigeria (LFN), 2004.
2. Central Bank Act, 2007; Banks and other Financial Institutions Act, CAP B3 LFN, 2004.
3. Pension Reform Act, 2014.
4. Insurance Act, CAP I17, LFN, 2004.