‘Only National Assembly can suspend Not-for-Profit Organisations Governance Code of 2016’

Pursuant to the provisions of the Financial Reporting Council Act (FRCA), the Financial Reporting Council of Nigeria created the Not-for-Profit Organisation’s Governance Code, 2016. The implementation of the code few weeks ago stoked so much controversy that the Minister of Trade, Industry and Investment, Mr. Okechukwu Enalemah, suspended it, while the Federal Government dismissed the executive secretary of FRCN, Jim Obazee. In this interview with JOSEPH ONYEKWERE and GODWIN DUNIA, Lagos lawyer, Mr. Chris Okeke, says the code was totally different from what the enabling Act provided for. He also maintained that only the National Assembly has the power to suspend or abrogate the code as a subsidiary legislation and not the minister.

A lot of people will actually want to know what the non-for-profit governance code provides in relation to the religious organisations?
In specific terms, this code made it easier for anybody to read and understand that it is seeking to create crisis in religious organisations. This is my interpretation because section 9 is clear about what it is talking about. And having created the crisis in the religious organisations, it is pretending under the same section to be solving the problem. For instance, without consulting religious organisations and bodies on how they run, the code created various bodies for them under what will be called governing council, board of trusties, governing board and head of executive management. Many religious organisation don’t have these kind of bodies. The code created them and went further to say that they must hold meetings at particular times and that they must keep their church members informed of their board meetings and all those details and that a leader must retire after 70 years of age or 20 years of been a leader of a religious body. The difficulty I have with this position is, when does the twenty years begin to run? It is confusing! If it is from when the ministry started, it means that you are making a law and you are making it have a retrospective effect and the constitutions frowns at this. Lets say it is from when the code started, then they will start counting from 2016 when the code began. In any case, these are private issues and I am not aware that our constitution allows this kind of development to crept into religious organisations or even seeking to determine how they run.

Do we have any law existing in this country that has such prescription?
The nearest to such law is the ‘Not for Profit Organisation’s Governance code of 2016.

What exactly did this code provide for?
It is seeking to provide for a number of things as indicated in its term of reference, but essentially having read through it, it looks to me that it is providing for ‘Not for Profit Organisations’ and for churches and their regulations in Nigeria.

Who prepared this code?
On the face of it, again, nobody’s name is indicated as the person that prepared it, but I can assume that it was prepared by the steering committee on the national code of corporate governance even when they didn’t say they did it but they said this code is the outcome of an additional directive to the steering committee on national code of corporate governance.

Does the code have the power to remove religious leaders?
Certainly it does not. It has no power to remove any religious leader.

Where did the former boss of financial reporting council derive the power to force religious leaders to leave their offices at a certain age?
That’s a very big question. He probably will answer that question better, since he is the one who acted. I am not the one who acted.

Some people still believe that this code was derived from the Financial Reporting Council Act (FRCA), is that correct?
Supposedly, this Act is for the purpose of development and publishing accounting and financial reporting standard to be observed in the preparation of financial statement of public entities in Nigeria. When you are now defining Code of governance, it is completely different from preparation of financial statement and accounting and financial reporting standard. This Act is talking about accounting and financial reporting standard and not governance code. These two are different, but it is for public entities in Nigeria. And the Act has defined public entities in Section 77 and in that definition, it did not include religious organisations. So it is very curious for religious organisations to be dragged into an accounting reporting standard.

So, there is no relationship between the Act and the Code?
That is my opinion!

A lot of people also say that there is always inflow and outflow of cash in religious organisations and some of these are channeled into private businesses like running of private schools, transportation and other businesses.

How do you react to this?

Those transport businesses, are you talking about transporting respective church members from one location to another or from one convention to another or for public transportation purposes? I am not aware of that they use them for commercial purposes. What I know is that the Churches use their transportation systems in furtherance of their respective objectives as church.

What educational investments?
You must remember that Nigeria has ran Missionary schools in the past and we know their contributions to educational development. So, it did not starts today and if you remove Mission Schools from our educational system, our education will collapse. In any case, what is the worry here, is it churches we are talking about or religious organisations? These are different things all together. Are we talking about churches or religious organizations, which is bigger and more than churches by definition?

Are you saying the code is not very clear in its reference to churches or religious organizations generally?
The code did not even define religious organisations, or Non-for-Profit Organisations. This is not right. It has to say this is what we want. No clear relationship between the code and the act.

Does the code have the force of the law?
The Act created public governance code. Section 51 sub C says, the issue code of corporate governance and guidelines. To the extent that it is the issue of code of corporate governance and guidelines. What the Act is saying is code of corporate governance and guidelines and develop mechanisms for periodic assessment of the code and guidelines. But what this man is doing here is not for profit organisations code of governance. In other words, whereas the law is telling him to do this code of governance in relation to financial issues, he rather concentrated on ‘Not for Profit’, which is not mentioned in the Act. And he moved from Not-For-Profit to Churches not even religious groups, because he did not mention Islamic groups except the mention of Mosques just once. He delved into the leadership of churches, organisation of churches, finances of churches, statements of churches and insisted that churches must justify their budgets.That is total interference in how Churches are run.

Are you saying that the General Overseer of RCCG acted in error?
I will not say the G.O acted in error, he is a man of God, but my view is that he was too hasty. So he was too quick to react. He did not wait to understand the purport of the code and vis-a-vis the requirements of Act.

So the dismissal of Jim Obazee is justifiable?
That is not my argument. I am not saying it is justifiable because am not interested in his job and you cannot personalized it on him because he is only the secretary. Or are you saying he did it alone? There are other members in the board.

So the point is that the institution overreached itself?
Again, will still need to be careful and ask ourselves if it is the institution that produced the code.

Now that the FG has suspended the code, are you saying they are right in so doing even against the belief in some quarters that it was because of some influencial personalities?
Firstly, who is FG, it comprises the Executive, Legislature and the Judiciary. What has happened is that the Minister suspended the code. The critical question you should ask is under the Act, does a minister has the right to suspend a subsidiary legislation made pursuant to an Act? The answer is no! He has no such power, not even the President. Because the Act was made by the National Assembly and they allocated the power to the Minister. That means only the National Assembly can take it from him.

Did he suspend the Act or the Code?
The code from what I heard.

Is the Code the Act of the National Assembly?
The code is made pursuant to an Act of the National Assembly. So, to that extent, it is a delegated power. You have to go back to the National Assembly.

You said it is not in consonance with the provision of the Act?
Yes!

That means it is ultra vires, null and void?
If it is ultra vires, then it is not the responsibility of the minister to declare it so, rather it is the responsibility of the Court to declare it so and the National Assembly to repeal or abrogate it, but not the minister. He doesn’t have such power under the Act.

Are you aware that some religious bodies went to court in respect of this code?
No. I only heard about it. I am not aware of the details.

You said that this code is a subsidiary legislation made pursuant to an Act and that the code was not provided for in the Act, because what was provided was different from what the code has done.

What is the way forward?
Having been made as a code ostensibly in furtherance of the Act, whether it is right or wrong, it has become a legislation.

And it has to go the full hog of abrogating a legislation. You cannot suspend it. It has a commencement date and it has no provision for suspension. Therefore, the only way forward is that the Court will declare it ultra vires or the National Assembly will abrogate it.