FCMB Saga: The Question of Corporate Governance and Crisis Management

By Chido Nwakanma

Two matters stand out in the FCMB saga. One is the issue of ethics and corporate governance. The other is the collateral damage to the bank’s corporate reputation and image.

Memes and videos are mocking the institution. Others have spoofs of their pay-off, turning it from “FCMB, My Bank and I”, to “FCMB, Your Wife and I.”

There is also the matter of the integrity of the trending narrative. What happened really? Persons claiming affinity to the parties involved say the blow out happened five years ago. At issue now is the power of the internet and social media in constructing narratives.

Someone or a group of persons used the unfortunate demise of Mr Thomas as the peg for spinning a salacious web that ropes in the bank through its primus inter pares. It is a deft and calculated sting filled from poisonous darts.

Mr Adam Nuru and his friends finally stepped out to debunk aspects of the story. They stated that  Nuru is not the father of Moyo’s two children; Nuru was friends with the late Thomas; the story is a fabrication made for social age; the alleged petition is anonymous. Note that none of the statements denied the alleged dalliance.

Nevertheless, the following stand out.

1. The narrative has provided room for sundry operatives to sully the image of the bank.
2. FCMB has issued a holding statement, acknowledging the issue, and assuring stakeholders that the bank is on top of the situation.
3. There are issues of corporate governance, ethics, HR management and corporate reputation.
4. Discussions of the matter must go beyond the sensual to examining issues of professional and ethical conduct.
5. The FCMB Relationship Scandal straddles corporate reputation and HR management. It is not “a personal matter” of the MD, as the bank wrongly stated. Both parties were in the employ of the bank, and the relationship played out therein.
6. The MD is the Chief Reputation Officer of every institution. He cannot effectively carry the corporate banner if his banner has horrible stains.
7. The reputation of the bank is critical. They should work to ensure no one besmirches it further.

Adam Nuru and his paramour contravened the Nigerian Code of Corporate Governance 2018. Section 4.6 of the Code demands the following of the MD: “4.3 The MD/CEO should establish a culture of integrity, conformance and performance, which should be assimilated by personnel at all levels of the Company”.

It further states:

The MD/CEO should declare any conflict of interest on appointment and annually thereafter. In the event that he becomes aware of any potential conflict of interest at any other point, he should disclose this to the Board at the first possible opportunity. Actions following disclosure should be subject to the Company’s Conflict of Interest Policy.

The relationship of the MD with a subordinate female staff presented a clear case of conflict of interest. Most organisations frown at superior-subordinate relationships across gender. The parties engaged in a relationship with a potentially harmful effect on the boss’s ability to supervise the subordinate.

It would also make it difficult for harmonious relationships at various levels of management. Her mates or superiors would find it difficult to relate with or censure her where necessary.

In claiming the issue, the bank stated:

“We are aware of several stories circulating across several media platforms about our bank’s Managing Director Adam Nuru, a former employee Ms Moyo Thomas and her deceased ex-husband, Mr Tunde Thomas.

“While this is a personal matter, the tragedy of the death of Mr Tunde Thomas and the allegations of unethical conduct, require the Board to conduct a review of what transpired, any violations of our Code of ethics and the adequacy of these Code of conduct ethics. This will be done immediately.We enjoin all our stakeholders to bear with us as we conduct this review and to please respect the various families involved.”

FCMB confirms in the statement that there was an affair. FCMB wonders if such a relationship amounted to “violations of our Code of ethics” and if the Code is adequate to tackle emerging issues.

Many other issues arise from the FCMB saga. They are branding, reputation management, the strength of the personal versus corporate brand, ethics and corporate governance. There is also HR management.

The bank needs to look beyond its Code and reference the Nigerian Code of Corporate Governance 2018. The Securities and Exchange Commission also has a Code for quoted firms.

The MD should step aside. The claim of an investigation is not credible while the MD sits unless the investigators report directly to the Board or the Chairman.

Before this saga, the MD of FCMB was one of the silent ones in media exposure. He had a very insignificant Top of Mind Awareness (TOMA) among bank CEOs. His affair is the excuse for “enemies”,  mischief-makers or fun-seekers to attack the corporate brand. What a way to trend!

The challenge, therefore, is ensuring minimal damage to the corporate brand.

• FCMB should issue a second statement no later than 8 January 2021 or the end of the first business week of the year.
• They should assure customers of the safety of their funds and other stakeholders of the bank’s health.
• They should commission a dipstick of stakeholders’ perception and a Perception Audit in the next three months to check any lingering negatives. It is an opportunity to do this audit that most firms fail to do in Nigeria. For instance, the dipstick will tell if this is a mere storm in a teacup or has a deeper reach and potentially more significance.
• Monitor. Monitor. Monitor. Media and non-media.
• FCMB should change the agenda as soon as possible. They could announce a major initiative that engages customers, primarily, or what their dipstick reveals.
• Create new and engaging content. Word of mouth is critical.

Members of NIPR Lagos had a mini-workshop on this matter on Sunday, 3 January through 4 January. Engaging and highly professional. Thanks to Toni Kan, Jide Benson, Nkechi Alli-Balogun, Emeka Maduegbuna, Olutayo Irantiola, Dotun Adekanmbi, Temitope Oguntokun, Eniola Mayowa, Taiwo Tunkarimu and Blessing Nwobodo-Itua.

The ball is in the court of FCMB. Massive fires spring from little triggers.