Why stability, operational integrity are critical to success of telecom industry – NCC

The Executive Vice Chairman of the Nigerian C o m m u n i c a t i o n s Commission (NCC) Prof Umar Garba Danbatta has said stability and operational integrity are critical to the success of the telecom industry. He said this in his opening remarks at the zonal sensitization workshop on the code of corporate governance for the telecoms industry in Kano on Thursday. At the workshop with the theme: Telecommunications at the threshold of Data Revolution, the Place of Good Corporate Governance as Enabler for Its Speedy Attainment, Prof Danbatta said proper adherence to good corporate governance creates a focus on value creation proposition that leads to sustainable growth and stability in the telecom ecosystem. He disclosed that current evaluation report of the state of the industry suggests that whilst not understating the impact of other external and ¿ scal issues confronting the sector, that most challenges negatively affecting the health of operators in the sector today are attributable to poor governance issues.

The Commission, he said, is determined to provide needed regulatory interventions to ensure that the sector plays effectively the enabling role it is mandated to create by the Act, the NCA 2003. He said: “It is currently rejigging its regulatory oversights in the areas of ensuring that consumers get cost effective value for money spent on telecommunication services; and that service delivery by providers are qualitative and efficient. In this regard it had declared the year 2017 as ‘Year of the Telecoms Consumer’ and implemented several initiatives targeted at refocusing the consumer as the fulcrum of the industry. “Towards empowering the consumer, the Commission initiated the Do Not Disturb (DND) facility and the short code 2442 as toll free portal to moderate incidences of unsolicited messages. It also hyped its second level consumer complaint toll-free line short code 622 towards addressing unresolved consumer complaints on service failures. Issues of Quality of Service and factors affecting it are being aggressively tackled including by means of engagement with the tiers of government to address issues of Security, Right of Way, Multiple Taxation and Multiple Regulation, etc. “In pursuit of its de¿ ned goal of regulatory operational efficiency, it has initiated international consultancies for the review of the Mobile Termination Rate (MTR) and International Termination Rate (ITR); and also for the determination of cost based pricing for retail broadband and data services. All the above initiatives are geared towards ensuring transparency in all areas of the Telecommunications service value chain by ensuring that tariffs are competitive and fair. Emerging from the cost based study of Mobile Termination Rate a new rate regime is to come into effect 1st March, 2018.

“The regulator is benchmarking its performance standards to international best practices as a means of bolstering sector and international con¿ dence. It is our expectation that the sector would align fully to these operational standards to consolidate on the gains already attained and further position the sector for even more robust performance. “The regulator through the corporate governance code seeks strategic collaboration and partnership, as a vehicle for building synergy and trust to boost investor con¿ dence through accountability and disclosure policies. Optimal compliance level could ultimately lead to sector players-selfregulation in due course.” By way of recap, he said, the Code of Corporate Governance for the Telecommunications Industry (the Code) was developed through an Industry Working Group and presented to Stakeholders in June, 2014 and was driven on voluntary compliance basis for two years up to June, 2016.

“During that period painstaking compliance levels evaluation was undertaken and the need to migrate compliance to a mandatory level was duly established. At an industry consultation held in Lagos in June, 2016 migration of the applicability and compliance levels reporting from voluntary to mandatory was formally announced and adopted by stakeholders. However, consistent with the regulator’s open and transparent approach to discharging its regulatory oversights the Commission has further developed a programme for further stakeholders’ sensitization workshops anchored on zonal basis to further enlighten and gain more robust stakeholders’ buy-in to ensure attainment of the code stated objectives”, he said. He stated that communications have made great and impressive strides in our national economic landscape over the past 16 years but given advances in communications innovations and their impact on the sector, the needs of society for communications have become more imperative than they were say in 2001. He said the advent of Broadband, LTE and Internet of Things (IoT) have made the need for focused development more urgent than ever. “Having noted that communication governance is international in scope and dimension; and that the fund and capital for it are dynamic, it calls therefore for governance practices that are wholly in alignment to international benchmarks, in other words international best practices”, he told the audience. In his speech at the event, the chairman of NCC Board, Senator Olabiyi Durojaiye said occurrences in the in the industry I recent past have brought to the fore the need for Code of Corporate governance to regulate the Board, Management and other stakeholders relations with the Company more efficiently.

By this Code, the Commission has resolved to improve the overall Economic and Regulatory stand of the Telecommunication Companies in Nigeria, he said. He said: “Basically, Corporate Governance involves the protection and balancing of the interests of the Company, its stakeholders such as Shareholders, Management, Investors, Suppliers, Customers, Government and the end users. “Therefore, the Code is directed to facilitate effective, entrepreneurial and prudent management of the Company resources that can provide for the achievement of strategic objectives of the Company using processes and procedures that are internationally accepted as of best practice. “In its determination to achieve best practice, the Code emphasizes that Boards of Directors should be responsible for the policy Orientation and Governance of their respective companies with a Governance operating model mechanism to be used by the Board and Management in translating the elements of the governance framework and policies into reality.” The chairman noted that the cardinal targets of the Code include entrenchment of Hard Work, Discipline, Transparency, Accountability, Integrity, Independence, Fairness, Corporate Social Responsibility and building of good reputation. “I want to assure you that the Commission will be more emphatic on healthy competition, improved Quality of Service (QOS), consumer satisfaction and investment”, he said. He said the mandatory compliance framework was already in force and the Commission will not compromise on its implementation, monitoring and enforcement activities for the total acceptance of the Code. In this regard, he said, operators had since been directed to make annual returns on their compliance level to the Commission, adding that these would be carefully reviewed and necessary action taken. According to him, the Commission is pleased to note that the industry has remained relatively stable, nonetheless, the stability and ultimate growth of the industry is being threatened by some unacceptable practices by certain players which if left unattended will severely undermine the relative stability. We are watchful and will not hesitate to do the needful, he warned.

He said: “The Commission is particularly concerned with issues of massive interconnection indebtness and unethical practice of masking of international calls. These sorts of unethical behaviours are part of what the Code of Corporate Governance is set up to address. “Henceforth, the Commission will be taking very tough measures against any detected unethical behaviour and industrial malpractice in order to safeguard the health of the entire industry. Compliance with with the spirit of the Code is a necessity. “Going forward, the Commission, as part of its initiatives to ensure compliance, will intensify monitoring level of compliance.

To encourage satisfactory compliance, the Commission has instituted an annual reward system to recognize and commend the most compliant Companies. “Good Corporate Governance is the best form of self regulation and licensees of the Commission are encouraged to consider it in their own best interest to imbibe and implement the principles enshrined in the Code. “I enjoin all stakeholders to support the full implementation of the code and ensure absolute compliance and also to reÀ ect on the values and ethics preserved in the code.”