Nigeria's Corporate Affairs Commission (CAC) Enhances Transparency with Public Disclosure of Company Owners

In a noteworthy effort to combat corruption and enhance transparency, the Corporate Affairs Commission (CAC) of Nigeria has unveiled its intention to disclose the profiles of company owners to the public. Through the implementation of an open register of beneficial ownership, individuals will have free online access to shareholders' records, thereby aiding investigations into corruption, illicit financial activities, and terrorism financing. This progressive step is widely recognized as a crucial measure in promoting accountability, as it not only allows for tracking of ownership but also serves to incentivize adherence to public ethics and business legislation.

The Corporate Affairs Commission's decision to make company ownership information publicly available reflects its commitment to fighting corruption and promoting transparency in Nigeria. By providing free and easy access to shareholders' records, the CAC aims to empower individuals, organizations, and law enforcement agencies to investigate potential instances of corruption and illicit financial activities.

During the International Peer Learning Workshop organized by the Corporate Affairs Commission (CAC), Alhaji Garba Abubakar, the Registrar-General, announced the official introduction of Nigeria's Open Register of Beneficial Ownership of Companies. This significant event marks the beginning of the implementation of the Beneficial Ownership Information Register in the country.

Anti-Corruption Initiative

Abubakar elaborated on the reasoning behind the open register initiative by stating:

“The essence of getting the beneficial ownership information is to support the anti-corruption initiative of the government. Companies are the vehicles being used for corruption, illicit financial flow, and terrorism financing. When our investigating agencies are doing their investigation, they will be able to track those responsible for some of these illegal activities.”

“In the past, the law allows one to incorporate companies using a corporate arrangement that makes it impossible to know the ultimate beneficiaries of these companies. The concept of separate legal personality has changed, they are now required to disclose the natural persons that own these companies from the point of incorporation and when there is any change.”

“So, this information is for use by investigation agencies, the media, and civil society, and the whole essence is to ensure transparency and make this information available. If we have information to the contrary as to what is actually disclosed in the register then we can escalate”

“The register is supposed to support the anti-corruption initiative of the government and it is a global requirement,’’ Abubakar said.

DR ORJI’S CONTRIBUTION 

Adding his perspective, Dr. Orji Ogbonnaya Orji, the Executive Secretary of the Nigeria Extractive Industries Transparency Initiative (NEITI), lauded the initiative as a fitting strategy in combating corruption.

“People will like to know who owns what. So, because you are aware when you are registering a company you are now ready to provide those information. And when you provide that information it puts you on your toes to obey the laws, observe the business ethics, and be transparent and accountable, especially in the payment of taxes and observance of public entities.”

“Because we know that the owners of the company are known, if anything goes wrong it will not be a problem to track them. But when you own a company and people don’t know who you are, you can use that office to perpetrate all kinds of crime knowing that you cannot be found,” Orji said.

The open register of beneficial ownership is expected to play a crucial role in uncovering hidden ownership structures and identifying individuals or entities involved in fraudulent activities. By allowing the public to scrutinize the ownership details of companies, the CAC seeks to enhance accountability, discourage illicit practices, and foster compliance with public ethics and business regulations.

Transparency and accountability are cornerstones in the fight against corruption. With the implementation of this initiative, Nigeria takes a significant stride towards improving its business environment, deterring illicit financial flows, and combating terrorism financing. The availability of this information to the public is anticipated to create a deterrent effect, making it more difficult for corrupt individuals to exploit corporate structures for personal gain.

Moreover, the public disclosure of company ownership profiles is expected to encourage ethical business practices and responsible corporate governance. Companies will be inclined to comply with regulations, knowing that their ownership structures are subject to public scrutiny. This measure can promote a culture of transparency, integrity, and fair competition within Nigeria's business landscape.

While concerns regarding privacy and data protection may arise, it is crucial to strike a balance between these considerations and the broader objectives of combating corruption and enhancing transparency. The CAC will need to ensure robust safeguards are in place to protect sensitive information while still allowing for meaningful public access and scrutiny.

In conclusion, Nigeria's Corporate Affairs Commission's decision to publicly disclose company ownership profiles through an open register of beneficial ownership marks a significant step forward in the fight against corruption. By increasing transparency, tracking ownership, and promoting compliance with public ethics and business laws, this initiative holds the potential to strengthen Nigeria's business environment and foster a culture of accountability and integrity.