• Blames poor planning, mismanagement
By Abba – Eku Onyekachi
The Registrar-General (RG) of Corporate Affairs Commission (CAC), Ishaq Hussain Magaji, says available statistics indicate that only 25% of new businesses in Nigeria survive for 15 years and above.
He also added that 20%, 45% and 65% of new businesses fall in the first two, five and 10 years, respectively.
The RG who was represented by the Director of Compliance in the CAC, Justin Nidia made the disclosure in his opening remark, titled “The Importance of Retreat in Management” at the 2023 Management Retreat with the theme: The Role of CAC in Promoting Investment and Economic Development, organized by the Commission for its management staff, in Nasarawa State, on Friday.
Unfolding his four-point agenda of: diversification of revenue base;enforcement of compliance;promotion of industrial harmony and;improvement of human capital, he attributed collapsing of businesses to poor planning and management.
While promising that the Commission will ensure proper management of businesses to avoid mortality rates, he added that the Commission would not only promote investments by ensuring seamless registration of new businesses, but more importantly that new businesses are nurtured to become multi-national corporations.
He therefore said that the choice of the theme for the 2024 event underscored the role the Commission plays in the birth and sustainability of businesses.
The most important thing an entrepreneur considers in the establishment of a business after capital, according to him is the formalization of the vehicle through which the business idea is translated into reality.
He therefore said it takes in the form of either the sole proprietorship, partnership or a limited liability company, adding that recently, business sustainability has assumed a more important role over the promotion of one because no one establishes a business with the objective that the business fails as soon it is formed.
Speaking on the importance of retreat, he said as a management tool, it provides an opportunity to withdraw from the crowd or daily routine to focus or refocus on the desired future and how to get there, adding that it is a time for introspection and deep reflection on current status and evaluate how far away or how close we are to the desired future position or vision.
On thorough deep soul searching, he noted that it is expected that an individual would sustain good practices or habits that brings him closer to the vision, drop those that hinder moving towards the vision and pick new ones that facilitates moving closer to the vision.
This, according to him, confirms Aristotle’s principle that, “we are what we do repeatedly. For organizations, it is expected that policies, processes and procedures are examined to decide on which to sustain, pick or drop”.
Sustaining global best practices, he went on, builds a culture of excellence, saying that Commission’s vision, mission and core-values, “we would all recall were developed and adopted in retreat like this in kaduna in 2002. We should therefore accord it the desired importance.”
According to him, the Commission was established by the Companies and Allied Matters Act (CAMA), No.1 of 1990 which later became CAP C20 LFN,2004. CAP C20, Law of Nigeria Federation (LFN) was repealed and re-enacted by the CAMA Act No.3 of 2020. CAMA 2020, he went on, brought in a lot of innovations, such as one-man company, beneficial ownership, business rescue (CVA, CA & Netting), electronic filing, signature and meeting, limited liability partnership, limited partnership, new capital structure, reform of Audit Committee, Administrative Proceedings Committee, enhanced regulatory powers over trustees, among others.
He however informed that some of the innovations would be thoroughly interrogated at the meeting, adding that changes in processes and procedures were also made to align with the new legal regime.
Pre-incorporation processes, according to him were developed and deployed for all business management organizations from January 1, 2021, adding that serious efforts were thereafter made to develop post incorporation processes. “Thus out of about 86 post incorporation processes, only about 10 are outstanding,” he disclosed.
“We have moved from Ease of Doing Business to AML/CFT/PF and now Beneficial Ownership designed to promote transparency and accountability.
“In the future, it is expected that speed, cost, accuracy and timeliness will be among important determining criteria for evaluation of global registry. I therefore urge all of us to make frank but courteous contributions to discussions that will built the future Registry of our dreams,” he advised.
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