In a call for enhanced transparency and accountability within Nigeria’s financial sector, Professor Mujahid Oliyide, a distinguished financial expert and Professor of Financial Law at Olabisi Onabanjo University, has advocated for an amendment to the Central Bank of Nigeria (CBN) Act. The amendment, according to Professor Oliyide, would establish a robust system of checks and balances at the apex bank, promoting its smooth operation and efficient governance.
Professor Oliyide delivered his compelling recommendation during the 111th Inaugural Lecture at Olabisi Onabanjo University. Emphasizing the critical role of proper checks and balances in the internal management and operational principles of the CBN, he proposed a structural division between the Board and the Management of the bank.
Under this proposed model, the day-to-day governance of the bank would be the responsibility of the management, while the Board would be vested with the authority for policy-making and oversight activities. Drawing inspiration from the United Kingdom’s governance model, Professor Oliyide highlighted how such a separation would foster corporate governance ideals and prevent the concentration of power in the hands of the CBN Governor.
Professor Oliyide also directed attention towards the appointment of the CBN Governor. He called upon President Bola Tinubu to meticulously select a qualified candidate and urged members of the National Assembly to rigorously scrutinize the nominee before granting approval.
Elaborating on the urgency of these changes, Professor Oliyide stated, “The CBN Act should be amended to ensure that proper checks and balances in the internal management and operating principles of CBN are entrenched. This will be a safeguard against the overconcentration of internal governing powers on the CBN Governor, which could result in imperial internal governance practices.”
Dissatisfied with the current state of affairs, he continued, “The Board of CBN should be separated from its management. While the management should engage in the day-to-day governance of the bank, the Board should be the highest decision-making body and should be charged with the responsibility of policy-making and oversight activities over the management.”
Expressing concern over previous appointments, Professor Oliyide asserted that the appointment of Godwin Emefiele as CBN Governor was an erroneous choice. He criticized Mr. Emefiele’s actions as a significant diversion from the core responsibilities of the office, which ultimately impacted Nigeria’s economic, social, and political landscape.
Professor Oliyide’s proposition extended beyond the structural reform of the CBN. He contended that the Nigerian banking sector was riddled with corruption and urged for its comprehensive reformation. “CBN is currently hydra-headed and manifestly overwhelmed by the multifarious activities it currently engages in and should, therefore, be unbundled,” he noted.
Furthermore, the esteemed professor advocated for the legalization of cryptocurrencies, recognizing them as a technological advancement in banking. He emphasized that digital currencies had gained popularity globally and that their legalization could bring substantial investment returns to Nigeria. However, he emphasized the need for a strong regulatory framework for virtual currencies to prevent misuse.
As his closing remark, Professor Oliyide recommended that ECOWAS explore the adoption of cryptocurrencies as a potential common currency for the sub-regional organization, thus addressing the persistent challenge of finding a unifying currency for regional integration.
About Professor Mujahid Oliyide:
Professor Mujahid Oliyide is a distinguished financial expert and Professor of Financial Law at Olabisi Onabanjo University. With a wealth of experience in the financial sector, Professor Oliyide has passionately advocated for the reform of Nigeria’s banking industry and the enhancement of its regulatory systems. His insights and recommendations continue to shape discussions on financial governance and innovation within the country.
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