He followed his observations with a number of posers: “What has gone wrong and still going wrong? What exactly is happening? Have the majority owners of multinationals lost confidence in Nigerians? A situation where the two biggest Confectionery Companies, two biggest Breweries and two largest detergent companies are being managed by expatriates is worrisome. Are all Nigerian top managers non-performing or adjudged by expatriates to be bitten by the bug of lack of integrity?” There were more: “What future projections can we make? Has it occurred to multinational owners of large manufacturing outfits, that 99 per cent of the consumers of their products are Nigerians? Is economic nationalism dead, killed by globalisation? Is there now an artificial glass ceiling in the Corporate Boardroom for nationals? That is, a level beyond, which nationals cannot rise.
As we were saying, the Nigerian telecommunications sector has been so successful in the last eight years that many of us have had to occasionally pinch ourselves to reassure us that we are not indulging our fantasies! When I see the things that we now routinely do on phone, including “flashing” your children within the home to summon them, I wonder how we ever lived without the mobile phone. Add to the hardly calculable utility value these humongous numbers – 70 million lines from a maximum of 500,000 in 2001; foreign direct investment (FDI) of up to $12billion or N180 trillion at today’s exchange rate; hundreds of thousands of direct and indirect jobs etc and you’ll agree we have nothing short of a miracle.
Here comes the puzzle. Why is the fastest growing telecommunications sector in Africa, and one of the top 10 in the world, run largely by foreigners? IT & Telecoms Digest, the magazine which triggered this had raised the puzzle in these words: “ironically, in spite of this monumental leap forward that the country has achieved in so short a time, it remains a puzzle why there are no Nigerians occupying the chief executive officer position in any of the telecoms companies in the country…In all, the percentage of CEOs of Nigerian extraction is less than 30 percent of the country’s industry total.” It is against this background that we pose the questions: “Is a glorious chapter of Nigerian history being written without Nigerians? If so, should we be worried?”
Before we attempt to find answers to these questions, however, it is pertinent at this juncture, to recall a piece, mentioned here last week, “Omolayole and Integrity in Corporate Governance”. It was a commentary on an article by Dr Michael Omolayole, a highly respected management expert and consultant titled, “Corporate Management: More Questions Than Answers.” In that piece the erudite management scholar had raised similar questions about the dominance of foreigners in the leadership cadre of major companies, particularly multinationals in Nigeria. He recalled how during “the last quarter of the 19th Century to the early 70s of the 20th Century” conglomerates and multinationals in Nigeria “were managed by expatriate personnel especially at the top” and how “the Indigenisation Act in Nigeria in the 70s helped in no small measure to change the status quo.” As a result of that law, he said that “where there was only one Nigerian CEO of a Multinational Company quoted on the Nigerian Stock Exchange” in 1973, “by 1980, the picture had changed. The country had four or five Nigerians who were CEOs of multinational companies quoted on the Stock Exchange. By 1990, the country probably reached the highest number and quality in terms of progress made”.
Omolayole then noted, much like the writers of IT &Telecom Digest’s current cover story now do about the their sector: “However, between 1990 and 2000, some large multinationals somehow did not seem to find it easy to sustain an indigenous management succession or decided outright to turn back the hand of the clock. Some of these companies are Guinness Nigeria Plc, Unilever Nigeria Plc, and Nestle Nigeria Plc. We are now more than half way into the first decade of the 21st Century and the picture is more gloomy. Cadbury Nigeria Plc, Nigerian Breweries Plc, WAPCO and PZ Industries have joined the groups that are now managed at the very top by expatriates”.
He followed his observations with a number of posers: “What has gone wrong and still going wrong? What exactly is happening? Have the majority owners of multinationals lost confidence in Nigerians? A situation where the two biggest Confectionery Companies, two biggest Breweries and two largest detergent companies are being managed by expatriates is worrisome. Are all Nigerian top managers non-performing or adjudged by expatriates to be bitten by the bug of lack of integrity?” There were more: “What future projections can we make? Has it occurred to multinational owners of large manufacturing outfits, that 99 per cent of the consumers of their products are Nigerians? Is economic nationalism dead, killed by globalisation? Is there now an artificial glass ceiling in the Corporate Boardroom for nationals? That is, a level beyond, which nationals cannot rise. What answers could we possibly give to such questions from our children and grandchildren with regards to this phenomenon?”
More questions than answers, no doubt, but let’s at least attempt answers to our earlier posers on the telecoms industry and see if it illuminates our path through this valley of decision. Is a glorious chapter of Nigerian history being written without Nigerians? It is easy to respond to this in the affirmative, because for the moment, from ownership to management, the industry is dominated by foreigners.
Interestingly, even most Nigerian-owned companies in the sector are executive-managed by foreigners. But to answer the second question, we must contend with the question: why do the investors prefer to install expatriates in their executive suites? This is a particularly important question because even the IT& Telecoms Digest article contained this unflattering piece of information: “Many telecom companies started the communications journey but few have survived the telecom boom period. In the same market where some companies have been reaping their gains in bounties, others have faltered mid-way into the race. They have either gone extinct or are barely clutching on to floating straws on the water surface for survival. These companies have a common denominator – they were once run by Nigerians!”
Could it therefore be that a fear of losing their investments or of failing to maximise their returns is the reason Nigerians are not being considered as CEOs? Is such fear founded on empirical evidence? If it is, is it the result of paucity of technical expertise, or competence, or experience or integrity, or a combination of some or all of these? Or are there other factors? (CONTINUES)
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