Appraising the performance of the Nigerian investment space in the past one year under the current leadership of the Securities and Exchange Commission (SEC) reflects a sector that has continued to respond proactively to emerging global trends as well as guiding the capital market towards desirable direction for sustainable growth.
The Nigerian Stock Exchange (NSE) serves as the hub for transactions in equities and other instruments beyond the official listing and trading of stocks alongside other securities, lies the protection of agencies, investors by promoting fair and transparent practices which is provided by SEC.
When the former Minister of Finance, Kemi Adeosun, on April 13,2018 approved appointment of Mary Uduk as the Acting Director General of the commission, she described it as the reassignment of portfolios in the capital market regulatory body.
According to a statement by Adeosun’s Spokesman, Olumuyiwa Akintunde, Uduk’s appointment was governed by the provisions of the Investments and Securities Act (ISA), 2007 and the conditions of service applicable to the Director-General of the Commission.
The statement also added that Uduk’s appointment had become necessary to ensure effective regulation of the capital market subject to satisfactory performance, subsist until further notice.
There were doubts regarding the appointment as it came at a time when stakeholders clamoured for a corrupt-free and consistent board.
These calls came when the erstwhile Director General of SEC, Mounir Gwarzo, was arraigned on a five-count charge by the Independent and Corrupt Practices and Other Related Commission (ICPC) along with Zakawani Garba, a commissioner in SEC, for allegedly paying himself severance benefits of N104.8 million and N10.4 million in excess of car grant while still in service.
However, a cursory assessment of the commission’s transformational strides has shown that Uduk, in the past one year, has taken a firm grip on the mantle placed on her despite the backdrop of the pervasive effects of the slow pace of the economy on the nation’s capital market.
Critical rating parameters showed that the acting SEC boss has done reasonably well in terms of sustaining investors’ confidence in the capital market; instilling discipline in transactional processes in the bourse; enlightenment and engagement of investors and their associations on emerging trends in global investment space.
Similarly, the commission has over the past year intensified sundry initiatives to protect the public from fraudulent or scam investment promoters, improve the contributions of the capital market to the economy; investment in human capital training and development; promotion of innovative technology and solutions in the SEC and capital market operations; and sustaining the implementation of the 10-Year Capital Market Master Plan (CMMP) with remarkable achievements recorded so far, among others.
For instance, the Uduk-led leadership of SEC has continued to promote the e-dividend mandate management system, the Direct Cash Settlement and the Multiple Subscription service option for investors. In addition, the commission has raised the bar of investors’ confidence through the National Investors Protection Fund (NIPF) risk-based supervision and the Complaints Management Framework that opens communication channels for investors to lodge complaints and get prompt responses.
The importance of the E-Dividend Mandate Management System is to eradicate or reduce to the barest minimum the incidence of unclaimed dividend and to boost the e-dividend mandate and Direct Cash Settlement initiatives. The commission has engaged the Nigeria Inter-Bank Settlement System (NIBSS) on behalf of the capital market community to facilitate identity validation and account validation in an effort to enhance market processes.
Apart from advising retail investors to invest in Collective Investment Schemes and Mutual Funds, given the low or zero risk level of such investments, the commission has also been carrying out various investor education nationwide to inform investors of the benefits of investing in long term securities and avoiding investments in illegal schemes, among others.
Also, the capital market apex regulator has recently initiated a collaborative relationship with the Nigerian Educational Research and Development Council (NERDC) on the development of a curriculum for basic and secondary schools on Capital Market studies as part of the Uduk-led management’s futuristic approach in Nigeria’s capital market development.
Recently, in furtherance of its investor protection mandate, the commission, in line with the provisions of Section 13 (w) of ISA 2007 which empowers the commission to close any illegal investment companies, sealed off the premises of some firms for engaging in illegal fund management activities.
In line with global trends, the SEC has also keyed into the idea of leveraging the performance of the nation’s capital market on technological products and solutions as a division now exists at the commission dedicated to Fintech which is helping the management to invest in and adopt all the technologies that relate to the capital market surrounding ICOs, among others.
This she said would reduce the cost of doing business in the capital market if properly leveraged. The Uduk’s led management also introduced the Fidelity bond as one of the requirements for all market operators to file in order to ensure the market is devoid of opacity in any form.
Even on the pesky issue of deepening the capitalisation of the market, the SEC’s leadership, in collaboration with the NSE, has not fared badly despite the increasingly worrisome under-performance of the nation’s economy over the past few years, including the associated investors’ sentiments about the 2019 general elections.
Yes, market capitalisation remains modest, available statistics on the market fluctuations has shown that the prospect is bright with the stock exchange index, which stood at 100 in 1984, now peaking at over 30,000.