(By Fred Omoruyi)

It is presumable that the skepticism of discerning members of the Nigerian public is the reason the House and its motley crowd of spokesmen has intensified publicity effort to get the claim to register. Beyond the clamour and propaganda, what are the facts? What does the Investment and Securities Act (ISA) 2007, an Act of Parliament, and the enabling law setting up the SEC, say about the qualifications of the DG of the SEC?

THERE is onslaught against Ms. Arunma Oteh and her leadership of the Securities and Exchange Commission (SEC) predicated on the repetitive claim that she is “unqualified” to be the Director-General of the SEC. The House of Representatives had passed a resolution asking President Goodluck Jonathan to effect Oteh’s removal on this basis and passed yet another resolution asking the President to obey the initial resolution on her removal.

   The House had, in the last quarter of 2011, passed a resolution mandating its Committee on Capital Markets and Institutions to conduct investigations through a public hearing on what was called “The near collapse of the Nigerian capital market”. This resolution was operationalised through what has gone down in the annals of parliamentary investigations in Nigeria as easily the most hostile attack on the leadership of any national institution. In conducting the hearing, Tukur El-Sudi who conducted the adversarial hearing put in place could be regarded as an atmosphere of structured bias towards Oteh.

   From the clearly open hostility it should come as no surprise that the highlight of the Committee’s report was a recommendation that Oteh be removed as Director-General of the SEC for not being “qualified” to be so appointed in the first instance. Beyond the recommendation, the House of Representatives has undertaken an intensive marketing effort to uphold the recommendation in the public domain through the media. The House and its many spokesmen have seized every opportunity on television, radio, newspapers and even the internet to reiterate that Oteh is not qualified to be DG of the SEC.

   It is presumable that the skepticism of discerning members of the Nigerian public is the reason the House and its motley crowd of spokesmen has intensified publicity effort to get the claim to register. Beyond the clamour and propaganda, what are the facts? What does the Investment and Securities Act (ISA) 2007, an Act of Parliament, and the enabling law setting up the SEC, say about the qualifications of the DG of the SEC?

   The provisions concerning the credentials of the DG of the Board of the SEC are to be found in Section 3 (2) (a) of the ISA 2007:

“(a) In the case of the Chairman or Director General of the Commission, he is a holder of a university degree or its equivalent with not less than 15 years cognate experience in capital market operations.”

This is the position of the extant law on who is qualified to be appointed as Director-General of the SEC. Is there any ambiguity in the above provisions? The aspect regarding university degree is utterly bereft of any ambiguity since there is even no specification of a discipline: “…university degree or its equivalent…” must mean at least a bachelors degree in any discipline.

   The other leg of the provision refers to “…15 years cognate experience in capital market operations”. The meaning of “capital market operations” is clear and bereft of ambiguity also as it relates, in layman’s language, to the gamut of activities connected with buying and selling of shares, bonds and other product offerings and investment opportunities available in the Nigerian capital market. This leaves only “cognate” as the one word which requires definition and clarification and even on this, there is unanimity and consensus that “cognate” means formally related, connected, cognate subjects such as physics and chemistry; of the same or a similar nature; of the same family; proceeding from the same stock or root; allied; things related by blood or origin; sharing an ancestor with another;

    The above survey of the various senses of “cognate” in mainstream English language usage establishes the commonality that it refers to two things that have a relationship by blood and or ancestry. Surely, the draftsmen of the ISA 2007 must have intended “…15 years cognate capital market experience” to mean “work experience in the financial services industry” which is the sector that is cognate or akin or related and ancestral to “capital market operations”.

     What are Oteh’s credentials and how well do they fit or suite the specifications of law? Oteh graduated from the University of Nigeria, Nsukka in 1984 with a first class degree in Computer Science. She obtained the prestigious MBA from the world famous Harvard Business School. Clearly, her academic credentials are stellar and they exceed the expectations of the ISA 2007.

   Oteh’s career path is in the global public space but can bear repeating for the purpose of establishing its capital market regulation validity and suitability. She joined Academypoint Investment in 1985 as Corporate Finance Officer in which capacity she executed debt and equity offerings in the Nigerian capital markets.

   She joined Irving Skinner of London in 1987 as a Consultant with a brief to identify investment opportunities and develop strategies for foreign firms entering the Nigerian market.

    Between 1990 and 1991, she was a Research Associate at the Harvard Institute for International Development in Cambridge, USA. At the institute, she was a member of the team that carried out a USAID study on the competitiveness of the West African manufacturing sector.

    In 1992, she was appointed Senior Financial Analyst in the Public Sector Lending Department of the African Development Bank. By 1993, she had been re-designated Senior Investment Officer / Senior Capital Markets Officer with managerial responsibility for the AfDB’s largest investment portfolio, the U.S. dollar portfolio.

   In 1997, Oteh was appointed division manager Investments, a notably senior position in the AfDB organogram. In April 2001 she was elevated to the high office of Group Treasurer in which capacity she had overall responsibility for the Bank’s fund raising and investments in major international capital markets. During her tenure as Group Treasurer, Oteh served as member of the Board of East African Development Bank (EADB) in Uganda (2004/05).

   In March 2006, Oteh was appointed Group Vice President, Corporate Services, a position she occupied until she was approached for the DG position at the SEC Committee.

    The ADB has as the main thrust of its functions the following: (i) It makes loans and equity investments for the economic and social advancement of the regional member countries, which include Nigeria; (ii) It provides technical assistance for the preparation and execution of development projects and programmes; (iii) It promotes investments of public and private capital for development purposes; (iv) It assists in co-coordinating development policies and plans in regional member countries.

   It was on account of the star-spangled credentials arising from Oteh’s educational qualifications, career path at the AfDB and in the other highly reputable institutions in which she worked that President Umaru Musa Yar’Adua of blessed memory approached her to become DG of the SEC. Oteh’s qualifications meet and exceed every provision of the ISA 2007, the extant law on who qualifies to lead the SEC as Director-General. Her direct and cognate capital market experience commenced in 1985 and spans some 28 years in unbroken progression.

   The institutional references in her career path, of which the AfDB is only one, are truly reputable. Oteh is an expert in development finance and capital markets. She is certainly one of Nigeria’s leading lights in these disciplines. She is a respected international voice on securities market regulation. She is on the Executive Committee of the International Organisation of Securities Commissions (IOSCO), the global standard bearer in securities market regulation. She is chair of AMERC, the Africa and Middle East Conference of IOSCO.

   Oteh’s record of stewardship as regulator and leader of the Nigerian capital market invites accolades and bears out her sterling academic / professional qualifications and work experience. All critical performance indicators have rebounded from the abysmal low to which they regressed in 2010 when she assumed office and have stayed north – bound. This development is in direct response to the mixed therapy of reform measures which she has doggedly pursued despite determined resistance in a bid to heal the market of the abiding ills of pervasive indiscipline, a low threshold of market enforcement, pre-digital technology, poor human capacity, lack of diversity in product offering as was evident in the bond / equity duality, low investor confidence, etc.

• Omoruyi is an Abuja-based investment banker and capital market analyst.

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