According to Section 279 of the Companies and Allied Matters Act (CAMA), as fiduciaries, Directors are expected to act in good faith at all times – a duty primarily owed to all stakeholders in the Company; exercise power only for proper purpose – if not, they may be liable to the Company for losses incurred; […]
It is acknowledged that the office of a Director is a “high calling”. It is oftentimes challenging and requires of the individual certain attributes to achieve effectiveness. Whilst each Board has its own peculiarities, being possessed of those attributes will contribute to the effectiveness of a Director and by extension the effectiveness of the Board. […]
A conflict of interest occurs when an individual is involved in multiple interests, one of which could possibly corrupt the motivation for an act in the other. It is inevitable that Directors will face situations of potential conflict of interest with the companies they serve. The “Agency Theory” postulates that Shareholders are principals and Management […]
Executives inevitably see themselves as responsible for the success of their organizations – and perhaps blame the microeconomic environment and other factors when they fail. This sense of accomplishment oftentimes comes with a surreal feeling of invincibility and executives sometimes have a sense that with all the responsibility on their shoulders, Non-Executive Directors should not […]
In an effort to maintain standards that form the basis of their competitive advantage, multinational firms have a set of standard operating procedures that apply across the global organization. Indeed, business success often depends on globally integrated operations – including marketing, production, information technology, research and development as well as human resource management. A major […]
It is acknowledged that the office of a Director is a “high calling”. It is oftentimes challenging and requires of the individual certain attributes to achieve effectiveness. Whilst each Board has its own peculiarities, being possessed of certain attributes will contribute to the effectiveness of a Director and by extension the effectiveness of the Board. […]
As useful as a Board of Directors is to an organization, it can only be impactful if it is effective. An effective Board will provide direction and guidance, ensure that Management works towards maximizing shareholder value and meeting other stakeholder expectations. To be effective, the Board most be composed of competent individuals who bring to […]
A recurrent challenge with many businesses globally is the failure to adequately plan for succession. Whilst the reasons for this may vary from one institution to another, there is no gainsaying that failure of leadership to plan for the future has far-reaching consequences that go beyond the organization itself and impacts on economic sustainability and […]
The courts have held that “a director’s right to information is usually unfettered in nature” (Kalisman V. Friedman, 2013 Delaware Chancery Court). Given the extent of their statutory duties, Directors are entitled to demand for and receive all such information as required to enable them take decisions that are in the best interest of the […]
“We all owe the shareholder activists, accountants, lawyers, and analysts who study corporate governance a debt: In the 1980s and 1990s, they alerted us to the importance of independent directors, audit committees, ethical guidelines, and other structural elements that can help ensure that a corporate board does its job. Without a doubt, these good-governance guidelines […]