Fireworks on the controversy over corporate governance issues in Oando Plc may begin today as the management of the company is set to contest the veracity of the sack of its directors by the Securities and Exchange Commission, SEC, last weekend.
The Chief Operating Officer, Oando Energy Resource, Dr Ainojie Irune, and the Chief Financial Officer, Femi Adeyemo, speaking to financial journalists at the weekend, indicated the company’s intention to challenge the decision of SEC from today.
Though they declined to give clear action to be taken they insisted that the Commission’s action violated the integrity of the 18 months forensic investigations on the oil firm undertaken by the multinational audit firm, Deloitte & Touche, on the orders of SEC.
Irune stated: “We will contest the action that our fundamental rights must be protected against the implementation of the SEC decision; we have the right to fare hearing, at least. The decision is convoluted and I don’t see how they are going to implement it.”
Adeyemi had also said that though the company’s management is not ruling out a court action, it has several options to take adding that consultations were still on-going as at the time he was speaking to the media.
Already, feelers from the Nigerian Stock Exchange, NSE, indicate that such major counter-move by Oando management may force it to place the company’s shares on technical suspension, the second time since the ownership and governance crises began in the indigenous oil giant.
An official of the Exchange told newsmen that NSE management is closely monitoring the developments, adding that immediate suspension of trading on the shares cannot be ruled out.
According to him the adverse impact on the shares would begin this morning even if the Exchange fails to suspend the trading. The company’s share price fell on Friday by 25 kobo to N4.20 from N4.65 on Thursday.
SEC, on Friday barred the Group Chief Executive Officer, Mr Wale Tinubu, and his deputy, Omamofe Boyo, from holding director positions of public companies for a minimum of five years.
The Nigerian capital market regulator also directed other members of the Board of the company to resign their positions forthwith.
The SEC also directed the convening of an extraordinary general meeting of the company on or before July 1, 2019 to appoint new directors.
The directives were part of recommendations in the report of the panel constituted to investigate allegations of regulatory violations against the management of Oando Plc.
The sanctions are among some regulatory measures by the SEC to remedy the infractions by the sacked management of the company.
The investigation followed the receipt of two separate petitions from investors by the Commission in 2017, about alleged regulatory misconduct by the management of Oando Plc, which is listed on both the Nigerian and Johannesburg Stock Exchanges.
In a press statement issued on its website, Oando responded to the SEC’s report saying: “Oando is of the view that these alleged infractions and penalties are unsubstantiated, ultra vires, invalid and calculated to prejudice the business of the Company. The Company has not been given the opportunity to see, review and respond to the forensic audit report and so is unable to ascertain what findings (if any) were made in relation to the alleged infractions and defend itself accordingly before the SEC. The Company reserves its rights to take all legal steps to protect its business and assets whilst remaining committed to act in the best interests of all its shareholders.”
The severity of the penalties and the timing of the release has roused public curiosity as to the motive and the basis for the penalties.
According to Irune, “We were not given a chance to review and respond to the outcome of the report. You do not sentence a person to death without giving him or her a chance to defend him or herself. In this instance we have been sentenced to death without knowing what our crime is or being given a chance to defend ourselves.
“At the barest minimum, best practice requires that you give the person a chance of a fair hearing. We have not been accorded this opportunity.”
Irune explained that when the company made the decision to drop its court case challenging the SECs decision to carry out a forensic audit it was assured that they could trust the system for an independent investigation that would be fair and follow due process. He reiterated that it was in the spirit of transparency, cooperation and full disclosure, they agreed to the forensic audit.