CORPORATE GOVERNANCE AND ETHICS ON THE NIGERIA BANKING INDUSTRY: CHALLENGES AND OPPORTUNITY

CORPORATE GOVERNANCE AND ETHICS ON THE NIGERIA BANKING INDUSTRY: CHALLENGES AND OPPORTUNITY

This research work is set out to investigate issues challenges and opportunities in the Niger a Banking industry. Also to see if a significant relationship exist between corporate governance, ethics and bank failure. Relevant data were collected using well structured questionnaire. The statistical technique for data analysis and test of hypothetical proposition is chi-square (X2) The result of the findings revealed that the new code of Corporate Governance and Ethics for Bank is adequate of the Curtail Bank distress and that improper risk management, corruption of Bank official and over expansion of Bank are the key Issue why Bank fails. It is concluded that corporate Governance and ethics is necessary to the proper functioning of banks and can only prevent banks distress only f it is well implemented.
Recommendation about corporate Governance and Ethics should be use as tool to help stem the tide of distress, as it entails conformity with prudential guidelines of the government. The Central Bank and NDIC should enforce the need for all banks to have approved policies in all their operation.

CHAPTER ONE

INTRODUCTION

1.1Background to the Study

Financial scandals and misappropriation around the world and the recent collapse of large corporate organization in the USA and Europe have brought to the fore, again, the need for the practice of sound corporate governance, which is the system by which the affairs of companies are directed and controlled with the aim of increasing shareholders value and meeting the expectation of other stakeholders. The case of Enron in the U.S and many cases in U.K such as Polly Peck, Maxwell Communication and British Ceylon Corporate Ltd (BCL) are all becomes stressing the need for the adoption of good corporate governance in our various organizations.

In Nigeria, most especially the financial industry the retention of public confidence through the enthronement of good corporate governance and ethics remain an uncompromised duty given the role of the industry in the credit to the needy sector of the economy, the payment and settlement system and the implementation of monetary policy. It is a veritable tool for ensuring corporate survival since business confidence usually suffers each time a corporate entity collapses. Most of the business failures in the recent past are attributed to failure in corporate governance and ethical practices. For instance the collapse of bank in Nigeria in the early 1990s to date was as a result of inadequate corporate governance and ethics practices such as insider related to credit abuses and poor risk appreciation and internal control failures.

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CORPORATE GOVERNANCE AND ETHICS ON THE NIGERIA BANKING INDUSTRY: CHALLENGES AND OPPORTUNITY