Corporate Governance in the Nigerian Banking Industry: Issues and Challenges

Abstract

Globalization no doubt has made the world a global village. This has given rise to the continuous integration of the world economy and capital markets which has in turn given rise to increase in the interdependence of international financial markets. It has also given rise to increased mobility of capital across the globe. Therefore, one way to assure investors across the globe that their investments are safe is by putting in place good corporate governance. That is, ensuring that business operations are carried out transparently and internal controls are adhered to. The corporate scandals experienced at the turn of this century across the globe and the recent bank crisis in Nigeria are traceable to poor corporate governance. This study is aimed at examining the corporate governance of the Nigerian banking industry and how to address the challenges posed by poor corporate governance in order to instill public confidence in corporate reporting. The paper adopted a conceptual approach. The finding reveals that the bank crisis is traceable to poor corporate governance practices and laxity in credit administration processes. It is therefore, recommended amongst others that there should be zero tolerance for corporate governance infraction and shareholders should be alive to their responsibilities by being active at the Annual General Meeting (AGM).