NIGERIA Law and Practice Contributed by: Yeye Nwidaa, Mariam Olayinka Akinyemi and Toluwalase Oliver-Jude, Jackson, Etti & Edu
3. Directors and Officers 3.1 Board Structure
2.3 Decision-Making Processes The decision-making processes of key corporate bodies are structured and governed primarily by the company’s articles of association and the provisions of CAMA. • Board decisions are usually made at formally convened board meetings through resolutions after deliberation. Voting procedures are typically set out in the articles of association and are commonly based on a simple majority. Where urgency pre - vents a meeting, decisions may be taken by written resolution, including electronic signatures of all directors, where permitted. • Shareholder decisions are made at general meet - ings of the company. Voting procedures depend on the articles of association and the nature of the resolution. In some companies, voting rights are proportionate to shareholding, while in others each share carries equal voting power. • Executive management operates within the author - ity delegated by the board. Its decision-making is focused on implementing board resolutions and making operational decisions necessary to achieve approved strategic objectives. • Other governance bodies (supporting structures), such as board committees, auditors, the company secretary and regulatory bodies, do not typically make binding corporate decisions. Instead, they follow structured processes such as committee deliberations, audits, compliance reviews and regulatory enforcement procedures. Their outputs – such as reports, recommendations and approvals – support and influence the decision-making of the board and shareholders, ensuring that decisions are informed, compliant and properly executed. Overall, while the board and shareholders make formal corporate decisions, executive management ensures execution within the defined limits of authority, main - taining alignment with the company’s strategic direc - tion.
In Nigeria, board structures are guided by CAMA and the NCCG 2018. A typical board comprises execu - tive, non-executive and independent non-executive directors, ensuring a balance between management and oversight. It is typically headed by a Chair, who leads the board, while the CEO manages the day-to-day operations, with both roles usually separated to ensure checks and balances. The board also operates through spe - cialised committees such as the audit, risk manage - ment, remuneration and nomination committees, which handle specific governance responsibilities. 3.2 Board Members The roles of board members are typically set out in the company’s board charter and are structured to ensure clear governance and accountability. • The board chair provides overall leadership to the board, ensures effective functioning and promotes cohesion in support of the company’s strategic objectives. Under the NCCG 2018, the Chair should not sit on any board committee, in order to preserve independence. • Non-executive directors provide independent over - sight by monitoring management’s execution of strategy, constructively challenging decisions, and ensuring alignment with the board’s governance framework and risk appetite. • INEDs perform similar roles to non-executive direc - tors, with the key distinction being that they have no material interest in the company and provide objective judgement, enhancing transparency and impartiality. • Executive directors/management typically include the CEO and other senior executives (such as the CFO and COO), and are responsible for day-to- day operations and the implementation of board- approved strategies. 3.3 Board Composition Board composition in Nigeria refers to the mix of direc - tors in terms of number, independence, skills, experi - ence and diversity. Under CAMA, private companies
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