FRC, Others Launch Governance Standards Project For SMEs

The Financial Reporting Council (FRC), in partnership with the Integrity Organisation/Convention on Business Integrity (CBI) and the United Nations Global Compact Network Nigeria has launched the Small Medium Enterprise (SME) Anti-Corruption and Corporate Governance Standards Project which is funded by the MacArthur Foundation.

The project aims to set standards for corporate governance, ethics, and sustainability to guide the direction, control, and management of SMEs in Nigeria, enhance their competitiveness, and achieve long-term success and value creation responsibly and sustainably.

With SMEs constituting nearly 96 per cent of businesses in Nigeria, most of them are largely poorly governed, making it difficult to secure the capital needed for growth. Also,  Nigeria’s challenging business environment creates pressures to adopt practices where complacency, shortcuts, corruption, nepotism, and discrimination flourish.

These practices create a cyclical effect, compromising SMEs’ ability to achieve and sustain high-performance outcomes, hobbling their ability to source funds, and eroding their capacity to compete in the African Continental Free Trade Area (AfCFTA) and beyond.

Standards Project intends to change this narrative using a data-driven approach.

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Accordingly, FRC, CBi and UNGC-NN will, through this Project, develop a replicable and scalable framework to enhance good corporate governance (anti-corruption, sustainability, and social equity inclusive) practices that would lead to a value creation strategy for all SMEs in Nigeria and increase their competitiveness, survival, growth, and succession.

In the initial implementation, participating Future-Forward Companies will receive hands-on, personalised guidance and assistance to comply with the standards.

Given the pivotal role SMEs play in driving Nigeria’s economic development, poverty reduction, job creation, economic emancipation, and overall well-being, the Project seeks to prove that it is possible – and profitable – for small businesses to do the right things, the right way, in the Nigerian marketplace.