ICSAN Sector Governance key terms

A principles-based national code issued by the Financial Reporting Council of Nigeria in 2018 that sets out governance practices for Nigerian companies, seeking to institutionalise good corporate governance and restore investor confidence.

The disclosure approach used by the NCCG 2018 under which a company states how it has applied each principle and explains any practice it did not implement, allowing flexibility while requiring transparency.

A government body established by statute to license, supervise and enforce rules within a particular industry, such as banking, telecommunications or oil and gas, including issuing governance codes for its licensees.

A formal document that defines a board's authority, composition, responsibilities and procedures, and clarifies the division of power between the board, its committees and management.

A board member with no material relationship with the company, its management or major shareholders, appointed to bring objective judgement and to challenge executive decisions without conflicts.

A smaller group of directors delegated specific oversight tasks, such as audit, risk, remuneration or nomination, with defined terms of reference and reporting lines to the full board.

A structured annual or periodic review of the board, its committees and individual directors against agreed criteria, used to identify effectiveness gaps and recommend improvements to governance practices.

The legal obligation of directors to act in the best interests of the company, with loyalty, good faith and care, placing corporate interests above personal gain or third-party pressure.

A systematic process for identifying and developing internal candidates to fill key board and senior management positions, reducing disruption when vacancies arise and preserving institutional knowledge.

A transaction between a company and a director, senior manager, major shareholder or their close associates, which requires disclosure, independent review and approval to prevent abuse.

Rules issued by the Central Bank of Nigeria for banks and financial holding companies, covering board composition, risk governance, disclosure and fit-and-proper requirements for directors and senior officers.

A company or entity wholly or partly owned by government that delivers public services or commercial activities, and whose governance must balance commercial objectives with political accountability.

In Nigerian public service, the official, often a permanent secretary or chief executive, accountable for the proper use of public funds and for complying with financial regulations within their ministry or agency.

A unified government banking arrangement that consolidates public funds into a single account or set of linked accounts at the central bank, improving cash visibility and reducing leakage.

A risk and control framework in which operational management owns risk, a risk and compliance function provides oversight, and internal audit gives independent assurance to the board.

A company-wide process for identifying, assessing, prioritising and responding to risks, integrating risk considerations into strategy, decision-making and day-to-day operations.

The amount and type of risk an organisation is willing to accept in pursuing its objectives, expressed in limits and thresholds that guide management and board decisions.

An independent, objective assurance function that evaluates the adequacy of risk management, control and governance processes and reports findings to the audit committee and senior management.

The overall attitude, awareness and actions of directors and management regarding internal control, setting the tone for ethical behaviour, competence, authority and accountability across the organisation.

A person or body holding assets or authority on behalf of beneficiaries or an organisation, with legal duties of loyalty, prudence and impartiality, and a requirement to act for the stated purpose.

A member-owned and democratically controlled organisation that provides services to its members, governed by the principle of one member one vote and regulated under cooperative laws.

The oversight of non-profit, non-governmental and voluntary organisations, emphasising mission fidelity, stewardship of donor funds, accountability to beneficiaries and public trust.

The reporting of suspected wrongdoing, such as fraud, corruption or unsafe practices, by an employee or insider through a protected channel, enabling investigation without fear of retaliation.

A situation where a director's or employee's personal, financial or family interest could improperly influence their official decisions, requiring disclosure and recusal from the affected matter.

The ethical signals and behaviour demonstrated by senior leadership, which shape organisational culture, compliance and the willingness of staff to follow governance rules.

A public body such as the EFCC or ICPC mandated to investigate, prosecute and prevent corruption, including bribery, embezzlement and abuse of public office in Nigeria.

A planned process of dialogue and interaction with groups and individuals who affect or are affected by an organisation's activities, used to inform decisions and build accountability.

A written authorisation allowing one person to vote on behalf of a shareholder at a company meeting, enabling owners who cannot attend to participate in governance decisions.

The yearly meeting of shareholders required by company law where directors present accounts, auditors report, and owners vote on resolutions such as dividends, director appointments and auditors.

A shareholder holding a stake too small to control company decisions, whose rights to information, fair treatment and voice need protection against majority abuse.

Facts or data whose omission or misstatement could influence the decisions of investors or stakeholders, and which therefore must be disclosed accurately and promptly.

A corporate reporting approach that combines financial, environmental, social and governance information into a concise account of how an organisation creates value over time.

Disclosure of an organisation's environmental, social and governance performance, including climate impacts, labour practices and community relations, often using frameworks such as GRI.

A written statement agreed by a family business setting out shared values, governance structures, succession rules and dispute-resolution mechanisms that guide family and business decisions.

The practical application of governance principles such as owner oversight, record keeping and access to finance to small and medium enterprises, often adapted to limited resources and close ownership.

A sector-specific code issued by the Nigerian Communications Commission that sets governance standards for telecom licensees, covering board composition, risk management and consumer protection.