The ongoing investigation into the near collapse of the Nigerian capital market by a House of Representatives ad hoc committee assumed a new dimension yesterday as the Director-General, Securities and Exchange Commission (SEC), Ms. Arunma Oteh, and members of her management committee openly disagreed on policies, programmes and actions of the regulatory agency.
The session exposed an institution torn apart, with an atmosphere of deep-seated animosity and mutual distrust not only among the top echelon but within its rank and file.
The committee had on Tuesday issued a summons on Oteh and the entire management team.
This was after the same committee had hinted that it had received a series of petitions suggesting the existence of serious wrangling and crisis within the regulatory institution.
In the opening shots at Wednesday’s proceedings, Oteh apologised profusely over her absence on Tuesday and explained that she did not intend to undermine the parliament when she excused herself from the public hearing.
Chairman of the panel, Hon. Ibrahim El-Sudi, promptly accepted her apology and also clarified that their rather harsh reaction was not out of any personal grudge but an attempt to ensure mutual respect in the relationship between the executive and the legislature.
“We have no ill feelings at all or harbour any other motives other than to ensure that Nigerians respect our democratic institutions. All the arms of government complement each other and we must not undermine any of them,” El-Sudi said.
The panel then opened its file of petitions and confronted Oteh with the several allegations levelled against her by persons suspected to be insiders in the organisation she superintends.
The petitioners accused her of high handedness and running a non-inclusive administrative system.
She was also accused of embarking on massive recruitment drive and head-hunting of persons styled as young professionals while ignoring the pool of personnel she met on ground.
Oteh was also confronted with the allegation that she allowed two members of staff of Access Bank Plc to be seconded to SEC, a situation they claimed represented a conflict of interest.
Although Oteh tried to justify all the actions, her claim that these actions were the result of expert advice and collective decision of the management deflated her defence.
One after the other, members of the management, who ought to know the inner workings of SEC, disowned these decisions and actions, leaving their boss in the lurch.
The Executive Commissioner in charge of operations, Ms. Daisy Ekineh; her counterpart in charge of legal and compliance, Mr. Charles Udora; and the one in charge of administration, Alhaji Sanni Stores, all declared that they were never aware of any management decision to hire contract staff or get personnel seconded from institutions regulated by the commission.
Director of Human Resources at the agency, Mr. Useni Dauda, testified that due process was not followed in the recruitment of some contract workers and alleged that they were unilaterally hired by Oteh on assumption of office.
According to Dauda, this category of employees were yet to get the endorsement of the executive management committee and the board of the agency.
He also affirmed the allegation that the contracts the affected personnel were renewed against the advice of the audit department.
SEC’s management team was also divided on the road map document currently being implemented in the capital market by the Commission.
Oteh had told the panel that the document was a collective effort of the management team and other stakeholders.
According to her, the road map was in line with a recommendation made by an industry-wide committee set by the SEC in 2008 before she assumed duty in 2010.
But again some of her colleagues on the management committee disowned the document and tagged it as the idea of an individual which was being driven by one person.
Apart from Ekineh, who said she made some input, Udora and Stores declared that nobody ever approached them over the road map and no one had ever brought the document to their knowledge.
There were also altercations over a programme tagged "Project 50" and the involvement of the regulatory agency.
The commissioners insisted that they were never aware of any donations made by corporate organisations for the Project 50, which was meant to celebrate 50 years of capital market regulation in Nigeria.
However, Oteh managed to avoid the continued altercations launched against her and insisted that she was focused on the transformation of SEC as well as reviving the capital market.
She said that the commission was fully committed to overcoming those challenges and strengthening the organisation to position it to successfully birth the world-class Nigerian capital market which is the object and vision of the transformation project.
“The SEC is not unlike other human institutions; the commission is not immune to common challenges arising from cultural and personal differences,” she said.
She remarked that the change project she is leading has the final objective of converting the SEC to a regulator with the best tools, personnel, systems and processes to discharge its regulatory oversight and market development mandate to international best practice.
According to Oteh, a transformation project of this magnitude has culture shock and cultural lag implications which are sure to create feelings of apprehension and even alienation among some members of the SEC family.
She promised that SEC, having closely followed and actively participated in the ongoing House of Representatives public hearings, had noted the frank disclosures at the hearings and intends to factor these into the change management element of the institutional transformation project.
“The hearing provides very useful lessons that will guide the commission’s continuing institutional strengthening programme.
The commission wishes to state categorically that the SEC remains a cohesive institution, whose activities are driven by highly professional and patriotic staff members under the headship of a very experienced management team and board delivering exceptional service to participants in an envisaged world-class Nigerian capital market,” Oteh said.
Meanwhile, the Commissioners said that for a better regulation of the market, there must be harmony in the management of SEC.
Suggesting the way forward, Ekineh, for instance, said that there should be more communication among the management team and staff members.
“The way forward is to communicate more. We should do more of personal meetings than more of emails and text messages. Although they are good but we should have scheduled meetings. We also need to respect one another. That is very important. There should be team work because people succeed more when there is team work and that is very important,” Ekineh said.
According to her, in the past management staff used to assemble in the DG’s office and rob minds together before going back to their offices to work.
This, she said, was lacking now, adding that "this is why we are having some of these issues. So the communication is very important”.
On his part, Udora said SEC should be an institution that can be on auto drive.
“And how can you achieve that? You set up institutions and set up systems and not individuals and this is done by setting out rules so that whether you are there or not, the job will be done. What is going on is because there is lack of trust and among us,” he said.
He also said the problem he has with the issue of contract staff is getting these people without following due process.
“When you hire people, allow them to go through the system and let the system absorb them.
“And then there would be harmony in the system. The contract staff has created disharmony among our staff. Because people came through the process they were not supposed to and they are occupying positions they do not know much about and giving wrong advice is creating lot of disharmony in the system,” he said.