The Premium Board of the Nigerian Stock Exchange (NSE) lists a group of publicly listed companies that meet the NSE’s most stringent corporate governance and listing standards. To date, only three companies have achieved the status – Dangote Cement, FBN Holdings and Zenith International Bank. Dubbed by the NSE as “industry leaders”, these companies adhere to international best practices on corporate governance and have met the NSE’s highest standards of capitalisation and liquidity.
To join the Premium Board, a publicly listed company must score at least a 70% rating on the NSE’s Corporate Governance Rating System (CGRS), achieve a market capitalisation or have a valuation of at least N200 billion, float at least 20% of its issues share capital and give a binding undertaking that they will promptly provide information about their operations and that follow administrative procedures of set out in the NSE Rulebook.
The NSE emphasises the importance of meeting the CGRS requirement and sets out the criteria for passing the test. Two elements companies need to concern themselves with are the self-assessment and completion of e-learning and interviews with investors and regulators, which makes up 90% of the overall score.
The key goal with the Premium Board is to give the listed members global visibility and credibility. Dangote Cement, a Premium Board member, has been planning to list its shares on the London Stock Exchange (LSE) from as early as 2012 but has had to address corporate governance issues to meet the LSE’s listing rules. Perhaps if the Premium Board has the intended effect, it will show the company has met the highest standard for corporate governance in Nigeria. Let’s just hope that is worth something.
Find out more about the NSE Premium Board
NSE: NSE Launches Premium Board
NSE: The NSE Premium Board FAQs
Guardian Nigeria: Who’s On The Nigerian Stock Exchange Premium Board?