Vacant CEO position at Globacom might lead to sanctions from NCC past the 24-month mark
Globacom Faces Potential Regulatory Sanctions for Failing to Separate CEO and Chairman Roles
In a significant move for the Nigerian telecom sector, the Nigerian Communications Commission (NCC) has issued new corporate governance rules, effective August 7, 2025. These rules aim to enhance accountability, transparency, and operational independence within the industry. However, Globacom, one of Nigeria's major telecom operators, finds itself in a precarious position, as it is currently the only company combining the roles of chairman and CEO.
The new guidelines require every licensed telecom operator's board to have at least five members, including a non-executive chairman, an MD/CEO, executive directors, non-executive directors (NEDs), and independent non-executive directors (INEDs). The chairman must be a non-executive director (NED) elected by the board, and cannot hold executive powers or be CEO. Globacom, with its founder and chairman, Mike Adenuga, doubling as CEO since the company's inception, stands as the lone exception among the four major operators.
The rules mandate that at least two non-executive directors, one of whom must be independent, should have relevant expertise in information communication technology (ICT) and/or cybersecurity. MTN Nigeria, Airtel, and T2 (formerly 9mobile) have already complied with this requirement.
If Globacom fails to appoint a separate CEO distinct from the chairman within the 24-month deadline set by the NCC, it faces potential regulatory sanctions from the Commission. The exact nature of these sanctions has not yet been detailed, but they are intended to enforce adherence to internationally-aligned governance standards. The NCC's enforcement powers under the new guidelines are extensive, with failure to comply leading to sanctions, including fines, suspension, or revocation of operating licenses, and the Commission reserves the right to order changes in a licensee's management.
The failed appointment of Ahmad Farroukh as CEO underscored the difficulty of balancing a founder's influence with the autonomy required of a modern corporate executive. Farroukh's resignation effectively restored the company to its previous arrangement, with Adenuga again serving as chairman and chief executive, potentially violating the NCC's new governance framework. Industry insiders suggest that differences over operational control and decision-making processes contributed to Farroukh's quick exit.
The long-standing concentration of executive power in Globacom has been a recurring source of governance concerns. The new rules are designed to address these issues and promote a more accountable and transparent telecom sector in Nigeria.
As the deadline approaches, Globacom has yet to respond to a request for comments regarding the new rules. The company's continued adherence to its founder-led model may invite increased scrutiny and regulatory penalties if it does not separate the CEO and Chairman roles within the stipulated timeframe.
- The new corporate governance rules introduced by the Nigerian Communications Commission (NCC) on August 7, 2025, aim to strengthen accountability, transparency, and operational independence within the Nigerian telecom sector.
- These guidelines require every licensed telecom operator's board to have specific members, including a non-executive chairman, an MD/CEO, executive directors, non-executive directors (NEDs), and independent non-executive directors (INEDs).
- From August 2025, the chairman must be a non-executive director (NED) elected by the board, and cannot hold executive powers or be CEO. Globacom, with Mike Adenuga serving as both chairman and CEO, is currently non-compliant with this requirement.
- If Globacom fails to appoint a separate CEO by the deadline set by the NCC, it may face potential regulatory sanctions, such as fines, suspension, or revocation of its operating license, as a result of non-adherence to internationally-aligned governance standards.
