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- Ethical Lapses Hinder Devt in Financial Sector – Expert
Ethical Lapses Hinder Devt in Financial Sector – Expert
- By Saka Khaliq
- Published November 24th, 2009
- MoneyWorld
- Unrated
THE gross exposure of financial institutions especially banks, to margin loans have been attributed to lack of ethics in the financial system.
This was made known by Mr. Emmanuel Chike Nwanze, president/chairman of council, Institute of Directors (IoD), Nigeria at Chartered Institute of Bankers of Nigeria (CIBN) investiture ceremony in Lagos last week.
According to him, ethical challenges in the financial services sector are multidimensional in nature and there is need to adopt a multi disciplinary approach to solving this problem. He said that unethical behaviours has affected negatively institutions (banks, finance houses, insurance companies among others) operating in the financial system of the economy.
Ethical lapses and challenges, he said, has led to fraudulent practices and lack of good corporate governance which has thus, brought about corruption in the banking system. Ethical lapses started when a worker break a rule for the sake of his selfish interest without mind the repercussion of such act, he said.
Theft, forgery, falsification of documents, manipulation of accounting records, lending without collaterals, he indicated has dampened the development in the banking sector. While attributing this to the recent sanitisation exercise carried out by the Central Bank of Nigeria (CBN) where about eight banks were implicated, he stated that unethical behaviours led to exposure of these banks to margin loans.
Applauding the sanitisation exercise, he called on all regulatory institutions such as Nigerian Stock Exchange (NSE), Securities and Exchange Commission (Sec), Nigeria Insurance Commission (Naicom) among others, to appropriately inhibit ethical behaviour in their various sectors to foster rapid economic growth and development.
Stating the circumstances that led to unethical behaviour, he said that selfish interest at the expense of the organisation’s interest, lack of morals or adequate trainings, ineffective corporate governance and so on, do more harm to the financial industry than good.
In a bid to checkmate ethical crisis, he called on professional bodies such as the chartered institute of bankers of Nigeria (CIBN) to work harmoniously with regulatory authorities to curb this challenge.
To him, “for the professional bodies in Nigeria to remain relevant, maintain the dignity of their profession as well as attract recognition from their local and foreign counterparts; the question of ethics has to be re-addressed through capacity building and imposition of appropriate sanctions for professional misconduct of members.”
Furthermore, he called on various supervisory bodies to adopt a more robust, proactive and sophisticated supervisory process based on risk profiling of the financial institutions under their purview.
Nwanze maintained that ethical behaviour and good corporate governance is critical to proper functioning of the financial system and the economy.
“Our ethical values shape the decisions we make in the workplace. The atmosphere that surrounds our offices and its corporate culture is a function of the ethical values and attitudes of both the employer and employees,” he noted.
At the event, at least 154 members were inducted into the honourary senior members of the chartered institute of bankers (HCIB).
Mr. Tokunbo Omolase, an engineer and a banker who was among those inducted into the senior members of the institute however appealed to his colleagues to embrace good ethical standard in their chosen endeavour.
This was made known by Mr. Emmanuel Chike Nwanze, president/chairman of council, Institute of Directors (IoD), Nigeria at Chartered Institute of Bankers of Nigeria (CIBN) investiture ceremony in Lagos last week.
According to him, ethical challenges in the financial services sector are multidimensional in nature and there is need to adopt a multi disciplinary approach to solving this problem. He said that unethical behaviours has affected negatively institutions (banks, finance houses, insurance companies among others) operating in the financial system of the economy.
Ethical lapses and challenges, he said, has led to fraudulent practices and lack of good corporate governance which has thus, brought about corruption in the banking system. Ethical lapses started when a worker break a rule for the sake of his selfish interest without mind the repercussion of such act, he said.
Theft, forgery, falsification of documents, manipulation of accounting records, lending without collaterals, he indicated has dampened the development in the banking sector. While attributing this to the recent sanitisation exercise carried out by the Central Bank of Nigeria (CBN) where about eight banks were implicated, he stated that unethical behaviours led to exposure of these banks to margin loans.
Applauding the sanitisation exercise, he called on all regulatory institutions such as Nigerian Stock Exchange (NSE), Securities and Exchange Commission (Sec), Nigeria Insurance Commission (Naicom) among others, to appropriately inhibit ethical behaviour in their various sectors to foster rapid economic growth and development.
Stating the circumstances that led to unethical behaviour, he said that selfish interest at the expense of the organisation’s interest, lack of morals or adequate trainings, ineffective corporate governance and so on, do more harm to the financial industry than good.
In a bid to checkmate ethical crisis, he called on professional bodies such as the chartered institute of bankers of Nigeria (CIBN) to work harmoniously with regulatory authorities to curb this challenge.
To him, “for the professional bodies in Nigeria to remain relevant, maintain the dignity of their profession as well as attract recognition from their local and foreign counterparts; the question of ethics has to be re-addressed through capacity building and imposition of appropriate sanctions for professional misconduct of members.”
Furthermore, he called on various supervisory bodies to adopt a more robust, proactive and sophisticated supervisory process based on risk profiling of the financial institutions under their purview.
Nwanze maintained that ethical behaviour and good corporate governance is critical to proper functioning of the financial system and the economy.
“Our ethical values shape the decisions we make in the workplace. The atmosphere that surrounds our offices and its corporate culture is a function of the ethical values and attitudes of both the employer and employees,” he noted.
At the event, at least 154 members were inducted into the honourary senior members of the chartered institute of bankers (HCIB).
Mr. Tokunbo Omolase, an engineer and a banker who was among those inducted into the senior members of the institute however appealed to his colleagues to embrace good ethical standard in their chosen endeavour.
