Prof. Enase Okonedo, Vice Chancellor, Pan Atlantic University, says organizations need to balance the interplay between culture and corporate governance to minimize organizational conflicts.
Okonedo said this at the Institute of Directors Nigeria (IoD) 2023 Biennial Lecture on ThursdayinLagos. It had the theme, “Cultural Norms Versus Good Governance: Balancing the Tug of War”.
She said the balance was necessary to reduce the adverse impacts of the interaction on organizational goals and objectives.
She noted that while culture represented a person’s set of beliefs, norms and traditions, its presence in organizations might affect the efficient functioning of boards.
She said that the practices of culture and beliefs, if unchecked in organizations, might hinder the effectiveness of board diversity and several codes of corporate governance.
“Corporate governance is a system by which organizations are directed and controlled. Its rules may not have addressed certain characteristics such as culture and beliefs.
“If companies can fail with good corporate governance practices, there must be other factors on the board that led to the failure of those companies, thus the need to reflect on attitude of directors that may be shaped by culture.
“If you say board diversity is important, we need to bring in younger people on board for a target market.
“Meanwhile, culture which places respect on seniors and elders can impact board dynamics due to the tendency to defer on critical issues to more elderly or senior persons.
“When we bring in such person and he becomes hampered by inherent culture, it hinders his ability by and large the effectiveness of corporate governance practices,” she said.
Okonedo emphasized the need to conform to the regulatory affairs of good corporate governance in Nigeria.
According to him, corporate governance aims to promote transparency, accountability and good governance practices.
She noted that in minimizing the conflict between culture and corporate governance, organizations must begin to raise awareness on the matter, promote ethical leadership and follow through with its written codes and visions.
She added that organizations should foster
stakeholders engagement with the local community to understand their concerns and cultural perspectives because of its significant role and impact.
She, however, said that businesses should be cognizant of these by being mindful
and establish systems to mitigate their adverse effects on organizational goals and objectives.
President, IoD, Dr Ije Jidenma, said that there should be a synergic effort of all the constituents of society for a good interplay of adherence to societal cultural norms and good governance.
The IoD President, whose tenure will end soon, said that under her leadership, the institute had recorded tremendous growth.
“You will all recall that the five pillars I mentioned in my acceptance speech were; inclusiveness, growth and development, chartership of the institute, IoD House Project and digital transformation.
“I have no doubt in my mind that we have done our best to add value to the institute in the last two years.
“I am sure that our system of continuity, which we emplace about five years ago, will ensure that my successor builds on the modest achievements of the past two years.
“Let me, however, admonish us all that the journey for a new IoD has just begun.
“We need to expertly navigate the process of transition into a chartered institute and ensure we put all feet right to ensure a seamless transition that will be to the benefit of members and the institute,” she said.
