Shareholders at an event
By ZAKA KHALIQ(NEWSWATCH TIMES NEWSPAPER)
Shareholders of Insurance companies across the country have applauded the decision of the National Insurance Commission(NAICOM) to dissolve the interim board of Goldlink Insurance Plc.
NAICOM, had over the weekend, announced the dissolution of the Interim board of Goldlink Insurance Plc.
Speaking in an exclusive interview with Newswatch Times at the weekend, on behalf of shareholders, the Chairman, Progressive Shareholders Association of Nigeria(PSAN), Mr. Boniface Okezie, urged the commission to ensure that the people on the new board are people of integrity, trusted and can turn the fortune of the company around for better.
According to him, “the commission must ensure that people coming to run the company are people who are capable, trusted, that would be transparent and turn the company around for the better of all stakeholders, including their clients and shareholders.”
He added that, “If you dissolve a board and you did not put in place a proper mechanism, that means you are going from frying-pan to fire. So, dissolving the board is not the issue, the issue is, you must reconstitute people of integrity that will turn the company around for the better. Then, it would go a long way to justify NAICOM’s intervention in this company.”
He, however, warned the regulator not to wait until things deteriorated in insurance firms before its intervention, saying, if things had gone so bad before intervention, it would not be easy to bring the affected companies back to profitability.
“If you are regulating and examining the books of accounts of these firms, why is it that water goes under the bridge before you are now intervening? So, the commission has to improve on this. However, the dissolution of the insurer’s board is highly welcome,” he pointed out.
At the company’s Annual General Meeting(AGM) in December 2015, where it presented its 2012, 2013 and 2014 accounts, the shareholders of Goldlink Insurance had given NAICOM 90 days to reconstitute the board of the company to reflect the investors’ interest.
It was unanimously supported by the shareholders who claimed unfair treatment as they are not represented on the interim board.
The Coordinator, Independent Shareholders Association of Nigeria (ISAN), Sir Sunny Nwosu, then, said the directive should be implemented within 90 days to salvage the company.
NAICOM, had on October 31, 2012, took over the management of Goldlink and also constituted a seven-man interim board of directors to oversee the affairs of the company for six months after the commission observed irregularities in the company’s 2011 financial account.
The interim board has James Olatunde Ayo, former Managing Director of Royal Exchange Assurance Plc as Chairman and Gbolahan Olutayo as the Managing Director.
The interim board was charged with the responsibility of carrying out full investigation of the financial reports and corporate governance failures observed in the course of reviewing the company’s financial statement for the year ending December 31, 2011.
The outcome of the investigations revealed various abnormalities identified in the 2011 financial statement and there were attempts to conceal the company’s true financial position.
According to the report, several irregularities were perpetuated by the former executives and staff of the company, particular, there was a complete breakdown of corporate governance typified by the former non-executive chairman’s permanent present in the office.
The report noted that the interim management board instituted a share capital audit which revealed that about 2.5 billion shares were inappropriately issued to selected shareholders without considerations into the company.