SEC: Time to toe the path of transparency

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By Omoh Gabriel

On Thursday, the United States of America’s Securities and Exchange Commission openly displayed America’s displeasure on corporate bribery by accepting the rule that companies listed in US Stock Exchange must disclose their payments to government officials.

The measure was essentially a move to assist African Government, particularly Nigeria to fight the hydra headed monster called corruption that has become a canker worm eating up every aspect of Nigeria.

The United States of America’s Securities and Exchange Commission voted 2:1 to adopt the anti-bribery rule that requires energy and other companies to disclose the payments they make to governments out side the United States and for manufacturers to disclose to investors whether their products contain certain minerals from conflict torn African countries especially from the Democratic Republic of the Congo.

Both rules were required by the 2010 Dodd-Frank financial regulation overhaul, but the SEC had delayed implementing them amid industry criticism that the rules are too onerous and may reveal sensitive information to rivals. The final version of the so-called conflict mineral rule removes an obligation required in previous proposals for manufacturers to be responsible for generic products made by a third party, that it puts its logo.

Nigerians have been engaged in debates on how to tackle corruption in the country. The US SEC’s rule is a lead to follow. Nearly all companies operating in the country have been involved in one form of bribery or the other in order to make a head way.

In a recent study conducted by World Bank in 26 states in Nigeria, released about three weeks ago, indicated that about 80 per cent of businesses in the country paid bribes to government officials in 2011 to stay in business. According to World Bank’s 2011 report on investment climate in Nigeria, one-third of micro-enterprises agreed that “informal payments/gifts to government officials” were common occurrences, suggesting that registered firms deal more with such requests for bribes.

Only 20 per cent of micro-enterprise firms were reported to have had foreknowledge of the amount of money required to “get things done,” a situation that means the informal payments are sudden and unplanned for.

These informal payments/gifts, the report went on, represented approximately 1.2 per cent of annual sales for all micro-enterprises. Manufactured goods attracted larger bribes (6.7 per cent) than those for small services (3.9 per cent). However, firms in the formal sector obviously spent more on corruption, as 47 per cent of formal firms claimed that informal gifts/payments were commonplace in comparison to 33 per cent for micro-enterprises.

But as soon as the report was released, those who always play to the gallery went to work to question the veracity of the report, saying with respect to corruption in Nigeria, why has the World Bank not condemned foreign companies like Halliburton, Wilbros, Siemens, Julius Berger and others which have been indicted and penalised for perpetrating large scale corruption in Nigeria?

The NEITI has just disclosed that foreign oil companies have duped Nigeria to the tune of over $2 billion. Instead of assisting Nigeria to recover such huge fund, the World Bank would prefer to package jumbo loans for the Federal Government with fraudulent conditionality. Why has the World Bank not supported the current Minister of Agriculture, Dr Akinwumi Adesina, who is determined to arrest the reckless importation of food at billions of dollars per annum?

But the damning report shows how deep corruption has gone into the nation’s bone marrow. Instead of Nigerians to rise up to the occasion of fighting corruption officially, they are engaged in blame games. If the legislative arm of government is corruption free, it will come up with a bill to deal with corporate bribery.

They will not do so because all levels of governance in the country are neck deep in corruption. How else will funds have been taken from NNPC account to buy helicopter for the Presidency as a gift without appropriate authorization. It is this kind of gift that makes it impossible for the Presidency to take appropriate measures against NNPC officials despite mounting revelations of high level of corruption.

It is no surprise that PHCN superannuation was not funded yet pensions were being paid. It is being alleged that the Minister of Power bought bullet proof vehicles from PHCN account as gift items to government functionaries. Nigerian legislators performing oversight functions on government owned companies feed fat on them through gifts in cash and kind.

This happens because they know the Nigerian public will never get to know about it. If there was a law that compels companies to disclose payments made to government officials, perhaps Hembe would have had a second thought before approaching Nigeria SEC for what becomes the hunter being the hunted.

Perhaps Farouk Lawan will not have attempted to ask Otedola for bribe to cover up his company’s oil deal track. Nigerians, let us put sentiment aside and deal with the real issue. Corruption is killing the nation! Nigerian Securities and Exchange Commission should follow the example of its US counterpart, by applying the same rule here.

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