Also aviation consultant, Dr. Daniel Young feels that founder of the business needs to stay away from the day to day management and be the founder but appoint an independent CEO, governing board and supervisory board as that currently is remiss in the Nigerian system.
Both men were speaking at the panel discussions of the 3rd Aviation Leadership CEOs Forum/Aviators Africa Tower Awards themed: Corporate Governance Structure: A Pathway to sustainability in African Aviation.
Captain Nuhu admitted that regulating corporate governance was a difficult thing to do because it had to do with the organizational structure and that could mean the CAA is over regulating the airlines.
He said the NCAA can only focus on the key post managers, a part of its functions he feels needs to be strengthened but stated that the Corporate Affairs Commission (CAC) had the statutory powers to regulate the organizational structures of business.
He said,”Regulating corporate governance, it is very difficult thing to do because corporate governance has to do with organizational structure and if you regulate that, it’s a very fine line you can cross over and over regulate. Corporate governance we all agree we have a governing board that sets the long term strategy and goals for the managing and you have the management that does the day to day running of the business.
“One of the issues we have in Nigeria is the owner manager and there is a bloodline between the long term strategies and the day to day running of the organization, so there is no check and balance and we need to differentiate the functions of the boards and the functions of the day to day management. There must be differentiated but must be both aligned .
He continued,”…Line between the owner and the organization are muddled up, the owner is an entity, the organization is a legal entity and it must be treated so and I think it not just the civil aviation regulation to enforce that, we have the corporate affairs commission which is the government agency saddled with that responsibility , they must come to enforce their regulations its not only in aviation, it cuts across a lot of organization in Nigeria.
He gave an illustration of his time in the now defunct Nigeria Airways stating,”I used to work for Nigerian Airways in the 80s i was there for 6 years, Nigerian govt was 100% owners, they were the boss and all and I was there for six years and they had four managing directors so it was an average of 18 months per CEO and no one could do any organization within that period, and they could not make long term plans that would improve the fortunes of the organization,”
In his submissions, Dr. Daniel Young said here in Africa there was a lack of corporate governance especially in a situation where someone says they have a board of directors and control it all putting friends and family members there that they still call the shots and influence technical managerial decisions.
He said,”When critical issues with regards employment of directors , sacking and making decisions to extend the brand are made only one person takes that decision and it affects a lot of things , so what we are saying here in Africa, if we wish to grow, if we wish to make the industry survive, we don’t have companies that are up to a hundred years because of this particular issue.
“If we wish to make this happen we have to separate ourselves from the business in which case, the CEO or founder of the business will need to stand away from the day to day management and be the founder but appoint an independent CEO.
He earlier said that corporate governance was of three types globally recognized,The UK-US model, the Japanese model and the German model stating that the Japanese model was more adopted because it is horizontal, diagonal and vertical and allowed for government’s input, staff and management impact.