The Central Bank of Nigeria (CBN), pursuant to Section 2.14 of the Corporate Governance Guidelines for Commercial, Merchant, Non-Interest, and Payment Service Banks in Nigeria, 2023, emphasizes the obligation of bank boards to establish and approve succession plans for Managing Directors/Chief Executive Officers (MD/CEO), Executive Directors (EDs), and senior management personnel.
This provision is intended to minimize disruptions in executive leadership, facilitate adequate preparation for new appointees, and mitigate risks associated with abrupt transitions in senior management.
In recognition of the systemic importance of Domestic Systemically Important Banks (DSIBs) to the stability of Nigeria’s financial system, the CBN hereby reiterates the need for robust and proactive succession planning within these institutions.
Effective immediately, DSIBs are required to:
1. Obtain Regulatory Approval: Secure the CBN’s approval for the appointment of a successor MD/CEO no later than six (6) months prior to the expiration of the current MD/CEO’s tenure.
2. Public Disclosure: Announce the appointment of the successor MD/CEO publicly no later than three (3) months before the planned exit of the incumbent.
These requirements are in line with international best practices on corporate governance and risk management and are aimed at ensuring leadership continuity in key financial institutions.
Institutions are advised to take immediate steps to ensure full compliance.
If you have any questions, need additional information, or guidance, please email compliance@thestructurehq.com
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