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Introduction Of Corporate Governance and Cooperative Societies in Nigeria. (a Case Study of Avamcu Calabar)
BACKGROUND OF THE STUDY
A definitive explanation given by O’Sullivan & Sheffrin, (2003) viewed cooperative as a business organization owned and operated by a group of individuals working together to achieve a common purpose for mutual benefit. A cooperative is set up to cater for the wellbeing of its members. They finance and operate the business or service for their mutual benefit. The issue of corporate governance came due to recent fall of some big corporation due to the dishonesty of managers who were vested with the trust of managing the firm and representing the interest of the shareholders but went ahead to mismanage the resources of the firm there by leading to the fall of some firms. Consequently, cooperative movement, had in recent times, focused on corporate governance as a means of promoting good governance and Management of cooperative societies. This is as a result of the growth of many cooperative societies which have instituted managers to manage its affairs. It is therefore imperative that this managers act in the best interest of the shareholders through adequate and proper disclosures of financial transactions, channeling of resources to the affairs of the cooperative and safeguarding their investments. The duty of care requires the management to act in good faith, apply their best judgment, and implicitly exercise due diligence. The study seeks to appraise corporate governance and cooperative societies in Nigeria. A case study of AVAMCU, Calabar.
STATEMENT OF THE PROBLEM
The corporate scandals which led to the fall of big firms has diminished investor confidence in boards of directors who were vested with the responsibility of monitoring executive performance and representing the interests of shareholders (Kim & Nofsinger, 2005). As a result, investors are interested in raising new ma nagement who will represent the interest of the shareholders, improve accountability and the effectiveness of corporate boards (Rauterkus, 2003).
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According to Brasilia (2008), the practices of good governance have proved to be fundamental in the success of organizations. Corporate governance ensures managers act in the best interest of the shareholders through adequate and proper disclosures of financial transactions, channeling of resources to the affairs of the cooperative and safeguarding their investments. The problem confronting the study is to appraise corporate governance and cooperative societies in Nigeria. A case study of AVAMCU, Calabar.
OBJECTIVES OF THE STUDY
The Main Objective of the study is to appraise corporate governance and cooperative societies in Nigeria. A case study of avamcu calabar; The specific objectives include:
i. To determine if lack of transparency is a feature of most cooperative in societies Nigeria.
ii. To determine if there is need for cooperative societies in Nigeria to engage in sound internal control and risk management.
iii. To determine whether corporate governance is solely responsible for the maladministration of cooperative societies in Nigeria.
RESEARCH QUESTIONS
i. Is lack of transparency a feature of most cooperative societies Nigeria?
ii. Is there need for cooperative societies in Nigeria to engage in sound internal control and risk management?
iii. Is corporate governance solely responsible for the maladministration of cooperative societies in Nigeria?
STATEMENT OF THE HYPOTHESIS
Ho1: There is no significant effect of corporate governance on cooperative societies in Nigeria.
SIGNIFICANCE OF THE STUDY
The study shall proffer a critical evaluation of corporate governance and its impact on the performance, survival and growth of cooperative societies.
LIMITATION OF THE STUDY
The study was confronted with logistics and geographical factors.
DEFINITION OF TERMS
CORPORATIVE SOCIETY DEFINED
Cooperative as a business organization owned and operated by a group of individuals working together to achieve a common purpose for mutual benefit. A cooperative is set up to cater for the wellbeing of its members. They finance and operate the business or service for their mutual benefit.
CORPORATE GOVERNANCE DEFINED
Corporate governance consist of a system of rules, practices and processes by which a firm is directed and controlled. Corporate governance essentially entails balancing the interests of a company’s many stakeholders, such as shareholders, management, customers, suppliers, financiers, government and the community. Since corporate governance also provides the framework for attaining a company’s objectives, it encompasses practically every sphere of management, from action plans and internal controls to performance measurement and corporate disclosure.
SHAREHOLDERS DEFINED
A shareholder (also stockholder) is an individual or institution (including a corporation) that legally owns one or more shares of stock in a public or private corporation. Shareholders may be referred to as members of a corporation. Legally, a person is not a shareholder in a corporation until their name and other details are entered in the corporation’s register of shareholders or member
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