The Nigerian Council of Insurance Brokers (NCRIB) has said that stakeholder dialogue with the Financial Reporting Council has become imperative, to ensure smooth implementation of the corporate governance which was released recently.
The code of corporate governance mandates a Managing Director and Executive Director in the insurance industry to vacate office on attainment of 10 years on that position.
The NCRIB notes that the implementation of the policy will create a big vacuum as well as threaten the continual existence of such firms.
The President of NCRIB , Kayode Okunoren who expressed this concern in Abuja urged proponents of the initiative to note the fact that the insurance industry is still quite fragile and challenged by insufficient manpower.
“I would not end my speech without sparing a few words for the newly released Code of Corporate Governance by the Financial Reporting Council. Although we are all aware of the need for strong corporate governance rules in ensuring sanity in business, the application of the rules with regards to the position of CEOs of Insurance Broking firms who have more than eight staff in their companies would do the economy no good.
“We like to reiterate here that Insurance Broking firms are professional institutions like the law firm, or the accounting firms, where services are personalised or based on the expertise of a few professionals within the organisation. We have instances where there are just two to three core insurance professionals in some broking firms, but with more than 15 support or non-technical staff.
“Asking the Managing Director or and the Executive Director to leave such companies on the attainment of 10 years in office will create a big vacuum as well as threaten the continual existence of such firms. Moreover, we must come to terms with the fact that the insurance industry is still quite fragile and challenged by insufficient manpower,” he said.
He enjoined the management of then Financial Reporting Council (FRC) to be open to more constructive dialogue that would further make the rules more amenable to change or moderation, in view of the peculiarity of the Nigerian economy.