The Chartered Institute of Directors Nigeria (CIoD Nigeria) strongly believes that the systemic weaknesses affecting governance in our nation’s public sector and State-Owned Enterprises (SOEs) constitute a first-order national development emergency. Corruption, procurement fraud, weak board oversight, fiscal opacity, and the persistent culture of impunity in public institutions are not peripheral administrative failures; they are structural barriers to economic growth, investor confidence, and equitable service delivery for over 240 million Nigerians.
CIoD Nigeria calls on all levels of Government, the National and State Assemblies, regulatory authorities, and all relevant stakeholders to treat governance reforms as an urgent, non-negotiable national priority and to enact the necessary institutional changes without further delay to ensure sustainable national development.
Nigeria has the institutional foundations, legislative frameworks, and natural resource base to become a transformative developmental state. What has persistently undermined this potential is not the absence of governance frameworks; it is the structural gap between framework design and operational reality, between law and enforcement, and between institutional mandate and institutional behavior.
This gap has a measurable and compounding cost on the Nigerian economy and its citizens. Ranked 142nd out of 182 countries (score 26 out of 100) on the 2025 Corruption Perceptions Index (CPI) and below the Sub-Saharan African average on the 2024 World Bank’s Control of Corruption Indicator, Nigeria’s governance deficit is both statistically significant and internationally visible. The April 2026 IMF report titled Budget Credibility in Sub-Saharan Africa identified that weak oversight mechanisms: institutional and governance, significantly contribute to severe execution gaps. This justifies the call for sound governance across all levels of government.
Principal Governance Failures
We, therefore, identify these five interconnected categories of governance failure:
Weak SOE Board Governance: Some SOEs do not have duly constituted boards, while many SOE boards are politically appointed without transparent criteria, limiting independence and effective oversight. This combination weakens accountability and contradicts OECD principles requiring competent and independent boards insulated from political interference.
Procurement Corruption: Despite the Public Procurement Act 2007, contract splitting, politically influenced awards, and weak contract controls persist.
Fiscal Opacity: Several SOEs fail to publish audited financial statements within statutory timelines, undermining transparency and limiting effective oversight by regulators, lawmakers, and citizens.
Weak Internal Controls: Internal audit and risk management functions across MDAs and SOEs remain under-resourced and insufficiently independent, reducing their ability to prevent or detect financial misconduct.
Weak Enforcement and Impunity: Governance breaches often go unpunished, weakening accountability and reducing governance frameworks to mere formalities rather than enforceable standards.
CIOD Nigeria’s Assessment of Existing Governance Frameworks
Nigeria possesses a relatively robust governance architecture supported by multiple legislative and regulatory frameworks. The Nigerian Code of Corporate Governance (NCCG) 2018, issued by the Financial Reporting Council of Nigeria (FRC), provides a comprehensive governance benchmark for corporate entities. Complementary statutes such as the Fiscal Responsibility Act 2007, the Public Procurement Act 2007, the EFCC Act 2004, and the ICPC Act 2000 collectively establish a credible legal and institutional foundation for accountability, transparency, and ethical conduct in both the public and private sectors.
In addition, sector-specific governance frameworks issued by regulators such as the Central Bank of Nigeria (CBN), the National Insurance Commission (NAICOM), and the Securities and Exchange Commission (SEC) have significantly strengthened governance practices within the financial services sector. Their relative success demonstrates that governance reforms can deliver measurable improvements when supported by effective oversight, regulatory commitment, and credible enforcement mechanisms.
However, despite the applicability of the Companies and Allied Matters Act (CAMA 2020) to certain State-Owned Enterprises (SOEs), significant governance gaps persist across the public sector. The primary challenge is not only the absence of governance frameworks, but also the weakness of implementation and enforcement. Many governance codes applicable to public institutions lack clear sanctions, enforceable compliance obligations, mandatory reporting timelines, and sufficiently empowered oversight structures.
The proposed Nigerian Public Sector Governance Code, being developed by the FRC presents a critical opportunity to address these deficiencies and institutionalise governance standards across Ministries, Departments, Agencies, and SOEs. CIoD Nigeria, therefore, strongly advocates for its urgent finalization, formal adoption, and mandatory implementation, supported by clear enforcement provisions, periodic compliance assessments, and appropriate sanctions for violations.
Recommendations
As the premier Governance Institute and leading voice in advocating for sound corporate governance in Nigeria, we therefore recommend;
To the Government at all levels, National and State Assemblies:
- Finalise and implement the Nigerian Public Sector Governance Code with mandatory compliance for all MDAs and federal SOEs, under the supervision of the FRC and backed by enforceable sanctions.
- Establish transparent, merit-based appointment processes for SOE boards, with published qualification criteria and representation from professional bodies such as CIoD Nigeria.
- Directors who have been found guilty of corruption charges should no longer be appointed on boards
- Enact comprehensive whistleblower protection legislation with secure reporting channels, legal safeguards, and incentive mechanisms to strengthen fraud detection and accountability.
- Enforce real-time budget reporting and public disclosure of government contracts through a transparent Federal Open Budget Portal aligned with global open contracting standards.
To Public Sector Leaders and SOE Boards:
- Publish audited annual reports and governance compliance statements within six months of each financial year-end to strengthen transparency and accountability.
- Strengthen internal audit and enterprise risk management functions by ensuring independence, adequate resourcing, and direct reporting to audit committees.
- Prioritise continuous governance and director education as an essential professional responsibility.
- Ensure more representation of non-partisan Independent Non-Executive Directors (INED) on the board of MDAs and SOEs.
To Sound Governance Advocacy Organisations:
- Develop and publish an annual Nigerian Public Sector Governance Scorecard to benchmark MDAs and SOEs against clear criteria, strengthening transparency and institutional accountability.
- Expand director certification programmes to include specialised public sector and SOE governance modules and institutionalise an annual Nigerian Governance Summit to advance reform priorities.
- Strengthen engagements with the National and State Assemblies, through structured policy submissions on governance-related legislation, and establish a dedicated Public Sector Governance Committee within CIoD Nigeria.
Good governance is not a bureaucratic luxury; it is the foundational infrastructure of a functional state and a competitive economy. CIoD Nigeria is unequivocal: the governance failures documented in Nigeria’s public sector and SOEs are not inevitable or insurmountable. They are the predictable consequence of political choices, and they are reversible through political will, institutional investment, and citizen accountability.
CIoD Nigeria commits to partnering with the government, the National and State Assemblies, regulatory authorities, development partners, and civil society to advance this reform agenda, through our Director Education Programmes, Bespoke Advisory Services and Strategic Advocacy Initiatives. We call on all stakeholders to join a governance reform compact grounded in transparency, accountability, ethical leadership, and institutional integrity, the surest pathway to a Nigeria of sustainable prosperity and equitable development that its citizens deserve and its potential demands.
Dr. Taiwo Nolas-Alausa, M.CIoD
Director General/Chief Executive Officer
Chartered Institute of Directors (CIoD) Nigeria
Monday, May 18, 2026