In the midst of a strategic maneuver to bury the era of the economy’s ultra-dependence on the mining sector alone, Sierra Leone is launching a new national corporate governance code. The goal is to ensure transparency and accountability for investors.
For the first time in its history, Sierra Leone is launching a national corporate governance code. The approach is intended to ensure transparency and accountability of both public and private Sierra Leonean entities in order to improve the business environment.
“We are ready to create the environment that [companies] need to do business and also to be competitive in the sub-region,” said Sierra Leonean Vice President Mohamed Juldeh Jalloh at the official launch of the corporate governance code on Wednesday, January 23 in Freetown.
According to the code’s pre-document consulted by the Africa Tribune, Sierra Leone had been working on this project for at least two years with the International Finance Corporation (IFC), whose Resident Representative, Frank Ajilore, took part in the launch ceremony.
The code emphasizes, among other things, professional ethics in governance and governs the rights of shareholders and investors. It also addresses the composition, committees, meeting processes, gender balance and responsibilities of the Board of Directors, in line with the OECD Principles for Corporate Governance. The document also provides a framework for the appointment of CEOs and the performance of their contracts, as well as several other key aspects such as the framework for the operation of family businesses.
Sierra Leone’s soon-to-be-created investment council
The new national corporate governance code also provides for the upcoming creation of an investment council. Chaired by the President of the Republic, Julius Madaa Bio, the institution will be responsible for deciding on investment projects in Sierra Leone.
For Freetown, the corporate governance code should support the strategy of diversification of the national economy and broaden its tax base – which provides revenue for the state – by attracting investment in various sectors.
Rich in gold and diamonds, Sierra Leone has remained dependent on the extraction of these minerals, which are exported without any processing, making the national economy particularly vulnerable to external economic shocks.
As far as the business environment is concerned, there is much to be done in this country ranked 163rd out of 190 in the World Bank’s Doing Business 2018. The same applies to corruption. Transparency International ranks it 130th out of 170 countries worldwide. Two years ago, many investors were showing their willingness to leave the country because of rising corruption.
Next April, President Madaa Bio will blow out his first candle at the head of the country and press for the acceleration of reforms to enable his country to emerge from the economic shadow in West Africa. The Ministry of Commerce has already announced several measures to promote Sierra Leone’s trade with the rest of the world and to reduce monopoly in certain sectors.