TRANSPARENCY AND ETHICAL
CONSIDERATIONS IN THE
DEVELOPMENT OF THE NIGERIAN
ECONOMY
TRANSPARENCY
• HONESTY\SINCERITY
• CORRUPTION-FREE
• FIDELITY TO THE RULE OF LAW/DUE PROCESS
ETHICAL CONSIDERATIONS
ETHICS:
MORAL PRINCIPLES OR VALUES WHICH ARE
TO GUIDE OR REGULATE CONDUCT OF
PARTICIPANTS IN BUSINESS, POLITICS OR
OTHER ENDEAVOURS.
E.G. WORK ETHIC
CORRUPTION
• GRAND CORRUPTION i.e. large scale theft of
public funds .IS ONE OF THE MAJOR CAUSES
OF POVERTY IN AFRICA .
• Africa Union estimates corruption costs
African Economies in excess of $148billion
annually in both direct and indirect cost
• Increases costs of goods by 20%
• Over $100 billion of Nigeria’s funds stolen and
transferred abroad.
PUBLIC SECTOR CORRUPTION
• Indicted and convicted public officials
embezzled in excess of 500 billion naira by
EFCC estimates
• Current probes into the power sector, oil and
gas indicate that perhaps as much as US$16
billion may have been spent without due
process in the power sector.
PRIVATE SECTOR, NOT PLAYING BY THE
RULES
• BANKS, OTHER COMPANIES, IPOs and the games they play.
• Quarterly financial reports of banks, no full disclosure, only
earnings before and after tax. (Whereas we should have
information on capital ratios, asset base, deposit base,
liabilities, asset quality, cash flow statements and notes to
account etc) This is compliance with international financial
reporting standards.
• Allegations against banks of having several different BOOKS
of account.
• The panic to sell shares when CBN insisted on same year
end may indicate that banks are lying about their liquidity.
• The Stock Exchange, Transcorp, etc.
CONEQUENCES OF NOT PLAYING BY
THE RULES
• Collapse of banks and other institutions. Note
current bank failures across the world. Also
remember ENRON, ANDERSEN ETC.
• Loss of confidence in the Stock Exchange, recent
flight of international hedge funds. Capital market
attained peak of N12.9 trillion in market
capitalization and has lost 33% of its value as of
September. (Banks account for 65% of the
capitalization of the capital market. 21 of the 24
banks are quoted on the Stock Exchange.
SOLUTIONS
• STRENGTHENING THE RULE OF LAW.
What is the Rule of Law?
Principle of governance by which all persons and
authorities are subject to democratically
promulgated laws.
The Rule of Law encompasses law enforcement
and the court system.
THE COST OF DISHONESTY
• Populations census.
• Elections
• Corruption in approval procedures, land titles
etc
• Certificate frauds, exam malpractices and the
quality of the Nigerian certificate.
• Non payment of rent and reduction in housing
stock.
RESPECT FOR CREDIT AND
OBLIGATION
• CONSEQUENCES OF FAILURE TO RESPECT
CREDIT AGREEMENTS AND OTHER
OBLIGATIONS.
• Poor individual credit rating for Nigerians
locally and internationally.
• Reduction in number of companies, local and
international willing to advance credit to
Nigerian new businesses.