By Nkiruka Nnorom
The Securities and Exchange Commission (SEC) has urged quoted companies to take regulatory compliance seriously, saying that keeping track of compliance requirements is essential for the promotion of sustainable development of businesses.
Lamido Yuguda, Director General, SEC, made the call while delivering a goodwill message at the third symposium of the Issuers and Investors Alternative Dispute Resolution Initiative (IIADRI) with the theme: “The Burden of Regulatory Compliance on Companies in Nigeria” in Lagos.
He explained that the overriding rationale for the sundry obligations of public companies is the need for an efficient market driven by transparency, accountability, full disclosure and good governance amongst others.
“While these regulatory requirements may appear burdensome to companies, they exist for the protection of investors who rely on accurate and timely information to make an informed judgment and for the proper governance of the companies.
“Failure to comply with these requirements exposes companies to the risk of being sanctioned by the relevant regulatory authorities. Sanctions for non-compliance could be in form of fines and penalties which could, in turn, lead to drains on the bottom-line, value erosion and loss of investors’ confidence in the business with attendant effect on the capital markets.
“Non-compliance also causes reputational risk in terms of bad publicity to the defaulting company and may ultimately result in revocation and withdrawal of licence and permits issued by relevant authorities,” he said.
He, however, said that the Commission is engaging with quoted companies and has put measures in place to ease some of the observed burdens on companies.
Also speaking, Mrs Cecilia Madueke, Company Secretary for Julius Berger Nigeria Plc, charged companies to see regulation and compliance as significant risk to their businesses, saying that compliance should always be on the front burner for governance body of each company.
“In what is clearly a challenging time for businesses, keeping pace with new and changing federal and state regulation is one of many factors that will be critical to success in 2021,” she said.
She lamented the regulatory contradictions in Nigeria, saying that government agencies set up to enable and facilitate the Ease of Doing Business constitute themselves into clogs in the wheels of business competitiveness and sustainability, thereby eroding government’s efforts and commitment to the Ease of Doing Business.Plc (-2.3%), drove the weekly loss.