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The place of minority investors in capital market operation

By William Jimoh


Investors play cogent roles on market efficiency — Shehu Mallam Mikaili

As regards the formation of shareholders’ associations, there are defined requirements by the regulator that guide the process. But today what we see is a different thing entirely; because today you now see many so- called shareholders’ associations that are there in the market working as if they are recognized by the Act that set up such associations.

One of the aims and objectives of setting up shareholders’ association is for them to help in the enlightenment of investors.

The association is also expected to build a cordial relationship between companies and investors in the market.
The shareholders’ associations have played cogent role in ensuring effectiveness, efficiency, transparency, and accountability in the operations of companies.

If you take for instance the GSK matter, if not for the pressure from the shareholders’ association, I can tell you that not even SEC would have done anything.

Some shareholders’ associations have even gone to the level of dragging certain companies to court on cases where the market regulations were not properly observed.

When it comes to the objective of enlightening the shareholders, I think we have also gone a long way.

For instance, in my shareholders’ association, we teach them on what form of shares to buy, how to buy it, when to buy, and what should be the motives and aspirations for buying it.  Also, we make them to understand the innovations that are coming into sales of shares today.

We let them know how to go about their e-dividends, e-bonus and what to do when they are having misunderstanding with their share bokers and with the delivery of their warrants and whatever. More enlightenment have been done and they are now aware of what to do at the right time.

Companies disgust our operations in the market — Chief Robert Igwe

The formation of the shareholders asociations is not just for forming sake. Also it was not designed to be a one man show, like we have it today, people will just come up and pick a name and begin to say that they are the chairman of the association.

The real reason for forming shareholders’ associations is to make  operators in the capital market to sit-up and carry out their function.

Without the formation of the shareholders’ associations, all these abnormalities that you see in the market today would have been worse.

All the innovations that you now see in the market are products of shareholders agitations. Because SEC would not have done or take some of these decisions.
Even now, the SEC is very reluctant in what they should do, it is the shareholders’ associations that are forcing them into it.

If you look at the CAC, SEC and all the other regulatory bodies, if there were no shareholders’ associations, they would not have been able to do what they are doing now.
If you look at the companies, many of them do not even want to see the shareholders at all.

For many of them, it is because they are not doing what they are expected to do, and it is the shareholders that are forcing the regulators to force these companies to ensure that they do what they should do. And that is why you can see all the improvements you are seeing in the market today.

So the formation of shareholders’ associations is very good as it adds more value to the capital market.The challenge that the shareholders are having today is that, like I told you, many of these companies don’t even want to see us, because they know that we are the people that are forcing the regulators to ensure that the companies comply with the rules governing the market.

For the fact that they don’t like this, it takes great effort on the part of the shareholders to ensure that the regulators make the companies do what they are supposed to do.
We therefore look at all these things as challenges when it comes to the protection of our interest.




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