Introduction

A company's most valuable assets are no longer just its bank accounts, buildings, or patents in today’s business environment. While these traditional assets remain important, a new form of capital has become a critical driver of business success: Data. From customer lists and financial transactions to operational records and supply chain logistics, data has transitioned from a simple byproduct of business to a strategic resource that can be collected, managed, and monetized to create immense value.

This shift is very important for Boards. The nation's rapidly expanding digital economy and tech ecosystem present both opportunities and risks. However, many corporate boards still view data governance as a technical task for the IT department rather than a central corporate concern. This article argues that treating data governance as a board-level priority is essential for building a resilient, competitive, and trustworthy business in the 21st century.

Understanding Data as a Corporate Asset

Just like traditional assets, data possesses measurable value. It can be a source of revenue, inform strategic decisions, and attract investors. For instance, a telecommunications company’s data on call patterns and customer preferences is valuable for developing new services.

A bank’s data on transaction history helps in creating personalised financial products and detecting fraud. However, like any asset, data carries risks if it’s not properly managed. The neglect of data can lead to serious financial loss, reputational damage, and severe regulatory penalties. In an era where a company's reputation can be built or destroyed in a single news cycle, poor data handling is a direct threat to long-term survival.

Why Data Governance Matters for Businesses

Several pressing factors make data governance a must-have for Nigerian businesses, not an optional extra. The Nigeria Data Protection Act (NDPA) of 2023 has established a strict legal foundation for how personal data must be handled. Companies failing to comply face fines, legal action, and a loss of public trust.

Beyond national laws, businesses that operate internationally or serve global clients must also adhere to regulations like Europe's General Data Protection Regulation (GDPR), which demands careful data handling and places responsibility squarely on the company.

Nigeria’s businesses have seen a sharp rise in data breaches and cyber fraud. In 2024, the Nigeria Data Protection Commission (NDPC) investigated 213 cases of data privacy breaches, up from 177 recorded in 2023. The rise highlights the increasing difficulties in safeguarding personal information amid the rapid expansion of the digital economy. These attacks are not random; they target a company’s most valuable asset, its data.

Beyond financial losses, data breaches can severely damage a company’s reputation, erode customer trust, and expose organisations to heavy regulatory fines. They may also disrupt operations, cause leakage of trade secrets, and open the door to identity theft or fraud against individuals whose information is compromised. In some cases, repeated breaches can even drive away investors and weaken competitiveness in the market.

An effective data governance programme remains the best defence. It ensures that data is properly classified, securely stored, and protected with strong security measures, reducing the likelihood of a successful breach.

Today’s consumer is more aware of their data rights than ever before. Customers want assurance that their personal information is safe and that it is not being misused. A company known for its strong data protection is more likely to earn and keep customer loyalty. Conversely, a single data leak can destroy years of hard-won reputation in an instant.

A business is only as good as the information it uses to make decisions. Without sound data governance, a company’s data can be inconsistent, incomplete, and out of date. This leads to poor business intelligence, flawed strategies, and missed market opportunities, putting the company at a disadvantage to its more organised competitors.

Key Elements of Effective Data Governance

Creating a functioning data governance program requires a structured approach with several core elements. This starts at the top. The board and executive team must assign clear ownership for data. A Chief Data Officer (CDO) or a dedicated Board Committee should be responsible for overseeing all data-related activities, ensuring that data is treated as a priority.

Beyond ownership and accountability, businesses need clear, written policies on how data should be collected, stored, accessed, and shared. These standards must be understood and applied consistently across all departments to prevent ad-hoc and risky data practices.

Data is useless if it is not accurate, complete, and consistent. Data governance ensures processes are in place to check and improve data quality continuously, making sure that business decisions are based on reliable information.

It must also address security & privacy concerns. Strong security safeguards must be in place to prevent unauthorised access, breaches, or leaks. This includes using encryption, firewalls, and access controls to protect sensitive data.

Hence, Directors must establish clear reporting mechanisms to show internal and external stakeholders that their data is being handled properly. This builds confidence and demonstrates a commitment to ethical conduct.

Governance Strategies for Businesses

To implement these elements effectively, companies should adopt several key strategies. This includes ensuring board oversight. Data governance should be a regular item on the board meeting agenda, just like financial reporting or risk management. This sends a clear message throughout the organization that data is a top priority.

Organisations should consider creating a dedicated data governance committee or appointing a CDO; this is also very important. This person or group will be responsible for developing and implementing the company’s data strategy and ensuring its alignment with corporate goals.

A data-secure culture starts with people. All employees, from the mailroom to the boardroom, must be trained in their responsibilities for data handling. This helps build a culture where everyone understands the value of data and the risks of misusing it.

Invest in technology. Investing in secure data management platforms, reliable cloud storage, and advanced cybersecurity tools is no longer a luxury. It is a necessary cost of doing business in a digital world.

Build and maintain partnerships. Companies should work with regulators, industry associations, and technology providers to stay informed about the latest regulations and best practices.

Recommendations for Boards

• Elevate Data Governance: Place data governance on the board agenda and link it directly to corporate strategy.

• Align with NDPA 2023: Ensure that all corporate data practices are in full compliance with the new national data protection law.

• Invest in Digital Literacy: Provide training for directors, management, and staff so they understand the business value and risks of data.

• Measure Value: Use metrics to track the return on investment of data governance initiatives, such as a reduction in security incidents or an increase in customer satisfaction.

• Engage Stakeholders: Involve employees, customers, and regulators in creating transparent data policies.

Conclusion

In the digital economy, data is no longer a mere byproduct; it is as fundamental to business as financial capital. Boards that recognise this and invest in robust data governance will build businesses that are not only compliant and secure but also trustworthy and competitive. Data governance is no longer a technical afterthought, but an integral part of modern corporate governance. Treating data with the same care and respect as other corporate assets can ensure that businesses secure their future and build lasting value for all their stakeholders.