Stakeholders Oppose Stock Exchange Boss’ Foundation

By Obinna Chima and Goddy Egene

Some financial market experts and shareholders of quoted companies have expressed concerns over a foundation that was recently set up by the Chief Executive Officer of the Nigerian Stock Exchange (NSE), Mr. Oscar Onyema.

Specifically, they raised concerns of corporate governance and a possible conflict of interest.

In fact, they pointed out that the fact that trustees of the foundation are related parties to listed companies on the NSE, could result to conflict of interest and likely erode investor confidence.

The NSE chief executive had last Friday launched the Oscar N. Onyema (ONO) Foundation.

According to the NSE boss, the not-for-profit and non-political organisation is expected to provide selfless sustainable high impact programmes that will positively affect the society.

In addition, he said it was set up to transform the lives of less privileged children and youth in Nigeria, among others.

But when contacted on the development, the chief executive of Proshare Nigeria Limited, Mr. Olufemi Awoyemi, faulted the setting up of the foundation by Onyema, who is an employee of the NSE.

He explained, “It compromises the integrity of the stock exchange. He is an employee of the NSE. I have never seen an employee have a foundation in an organisation.

“It beggars belief to understand what is really going on and I do not know of any stock exchange globally where an existing CEO will have a Foundation in his name.”

He also argued that as a not-for-profit organisation, quoted companies may want to curry Onyema’s favour by donating to the Foundation if it calls for a donation.

“Should any quoted company donate to that foundation, it might be deemed to be a benefit in kind and how does that augur well for the market?

“Also, if you look at people who are the trustees, they are related parties to listed companies. How do you therefore separate the fact that the CEO of the Exchange has a Trustee comprising related parties to listed companies on the NSE?

“My concern is that for the NSE, this would not augur well, and it will not end well. The best time he (Oscar) should have done this would have been after his resignation,” Awoyemi insisted.

But the NSE spokesman, Olumide Orojimi, doused concerns of a possible breach in corporate governance with the Foundation.

“He (Onyema) does not require the NSE council’s approval to set up the Foundation,” he said in response to enquiry by THISDAY.

“For the avoidance of doubt, many of them (the council members) were even present at the event. He is giving his personal money to the Foundation and not soliciting funds from any quoted company as you have insinuated.

“This position is clearly stated in his quote in the press release where he said he is giving his personal funds and time to the Foundation,” Orojimi added.

In the opinion of a shareholder activist, who is Chairman of Progressive Shareholders Association of Nigeria (PSAN), Mr. Boniface Okezie, the idea of giving back to society by people who have attained high positions and are successful is very laudable, but such could be done without conflict of interest.

Okezie said Onyema ought to got a better advice on this matter, saying his advisers on the project gave him a wrong advice.

“There is nothing wrong in giving back to the society and there are many ways to do that. For instance, Onyema ought to have started a small way by giving scholarships to indigent students in his community or environment where he lives without setting up Foundation until after he is out of an organisation that serves the interests of many individuals and corporates,” he said.

According to Okezie, running a Foundation and at same time being the CEO of NSE will bring conflict of interest and tell a bad story of corporate governance.

“As the CEO NSE, where we have many companies listed, even if he does not solicit the support of these companies, some may want to donate to influence certain things in their favour. Onyema should have waited until after leaving as the CEO of NSE before setting up a foundation. By then, his good deeds would naturally attract support. But using his name to set up a foundation while still CEO of an exchange is wrong.   To me, he did not get a good advice on this project,” he stated.

According to another shareholder, Mr. Oderinde Taiwo of Proactive Shareholders Association, what Onyema has done is putting the cart before the horse.

“To me it is like putting the cart before the horse. Although you may say the NSE is not a government institution, but it is serving the public, which makes its CEO a public servant so to say.

“Therefore, it will not be right for a public servant to float a foundation. The world is watching us, we should do things the right way,” he added.