Monday, August 17, 2015

The Corporate Affairs Commission: Another parastatal in dire need of overhauling?

The protagonist of this story is the Corporate Affairs Commission (hereafter called CAC); the story was born on the 19th of May 2015, it is a real live story and still unfolding. It has become my civic duty to share this story since other channels have proven abortive.

An overview for the skimmers

On the 19th of May 2015, my tech startup submitted a change of director request at the Yaba Lagos office of the CAC. The intent of course is to change the director structure of the company since some people have moved on and new people have come on board, just like every other thing in life.
Today, 17th August 2015 is the third month anniversary of submitting the fully vetted documents at CAC for a process we were assured will take a maximum of three weeks. We have been to the same office at least 10 times, written a complaint letter and yet another petition. The verbal response we have gotten, just so no one is committed, is that they cannot find our file.
If you are tempted to say, “It’s just to change directors right? Business can still go on can’t it?” Well, it’s like this. So we have been on a project for “that very big old blue bank” for a few months. To mitigate some past issues we decided to focus and prioritize their project and worked at it dedicated for a few months. In another article, I will be writing on why startups may want to avoid the big enterprises, but again that is for another day.
To cut the long story short, our “benefactor bank” insisted that this time around they will only pay into an account domiciled at their bank and can no longer give us a bank check to pay into our other bank accounts, which has been the practice erstwhile. Some directors in our startup have moved on and yes we were already re-documenting and yes we did protest about how it was not a good time. Despite the protests, we had to comply and expedite, especially since, “We have a new CEO from retail, he won’t allow payment to another bank account” and “It’s regulatory” or “It’s a compliance issue”. The most important reason, unsaid, however was, “Dude, just do it. We’re big and when we say toad, you jump”.
Like a rational company, we swung into action, faster this time, and submitted the necessary papers to CAC Yaba, Lagos office. Now you know half of the whole story.

So, kinni big deal?

Our account is frozen!
The bank opened our new account, paid us and froze the account. The account is frozen so stiffly that we cannot even hedge our exposure to de-valuation of the fund because they won’t even allow us to invest the money in government treasury bills in the same bank. Can you just imagine working for months, finally getting a bank alert but unable to shout “Godwin” because the fund is untouchable? The bank has conducted searches, but it returns the previous director structure. It seems CAC’s computer system shows the old company structure but they cannot locate the physical files to update it or something along these lines. Bottom line, we have not received one, not one response in any form from the CAC and that is why it seems I’m saying a lot of “seems” here.
Not everyone understands how this affects small businesses
As you hopefully know, cash-flow is the single most important thing that can keep any startup or any business for that matter alive, not even profit as many people think. The impact on our operations includes projects that cannot be actualized; salaries delayed but paid anyway not to mention a rising debt profile.
Try to imagine a project that should be adding to the bottom line but cannot be done but salary has to be paid anyway. By the time the issue is resolved, the money that should fund projects are instead used to offset debts.

The CAC Office, a detour

If you have been to any public sector office for any transaction, you’ll feel my pain. I remember one old NEPA office where a lady said I cannot give here anything with my left hand when my right hand was healing from a burn because, “It’s disrespectful”. My wife cited an incidence when her office called NAFDAC to lodge a complaint and a cold voice at the other end said, “I said good morning…” Do you remember how you are inclined to be extremely nice when you visit government offices because you know the slightest offense may keep you waiting for hours for no just cause (don’t get me wrong, I’m an advocate of being respectful to workers and others generally but you know what I mean).
On the other hand you will also relish the joy of speaking to the agent of a private bank or telco; recollect how they genuinely attempt to resolve your issue in a timely manner, how they strive to retain you as a customer and how you nag them despite all their efforts. That is the reward of service management, a topic that cannot be accommodated in this epistle.
Well, the CAC office is not different from that public sector office that you remember too well but discussing this will take us away from the today’s drama. Do you know it take hours to get attention at the CAC even when you can see no one is being attended to? Do you know a helpline exist but not very helpful? Do you know you can submit complaint letters and you are never contacted? Do you know you can write petitions and it goes down the drain? Do you know they lack service management? No ticketing system so no one can look at ageing requests and take appropriate actions?

So CAC can’t find the file? A theory

Some years ago, CAC relocated from Lagos to Abuja along with many other federal parastatals. After I spoke with several people while trying to resolve this impasse, there were suggestions that files may have been scattered, wrongly catalogued or stored in dusty rooms.
I find this inexcusable however; how will the CAC carry out its mandate as custodian of company and allied matters? How do we move from an agrarian society to a service society without mining the world’s latest most valuable raw material i.e. data? How do we then fight terrorism if every source of tangible data cannot contribute meaningful information to the pool? Has it suddenly become understandable how Honorable Abike Dabiri-Erewa’s name was wrongfully quoted as one of those accumulating bad debts in banks?
If they will allow it then I’ll bring volunteers from my 12-man team from Lagos to Abuja to search for the missing file.

So, why are you on social media?

If you have received your salary in the past 3 months I haven’t, and painfully not because I’m a sluggard who refused to work.  If you have wards in schools you already know school fees will be paid in September. Beside, a drowning man knows no straw. So if this is an accommodating medium where others have failed, I’ll cling to it. After all, no one is trying to pull down a PDP or APC government, just canvassing for better service management in the public sector.
And yes, we have written twice to the CAC; one a complaint letter submitted over 6 weeks ago at the same Yaba office and the second a petition to the registrar general, Mr. Bello Mahmud on the same day. None of these letters have commanded a response from the CAC even though it has full contact details including phone numbers.
I also got a scare; a friend told me it took him two years to resolve a similar issue. Another colleague spent nine weeks in an expedited attempt to register a company; CAC claims today that it 24 hours to register a company in Nigeria, apparently it takes three months plus to service them.

A note about our mentality, because culture matters to the wellbeing of a nation

As much as I empathize with our brothers in public service in many ways, from the need for an improved healthcare system to higher standard of living but dare I say it’s not all moonlight and roses in the private sector? The next time you carry a placard you must also consider if you have contributed your good to the national portfolio, if you were “on time” to work for the better part of last month, if you discharged your duty faithfully in your place of work, if you indulge in the fact that you are backed by a union and lose your sense of faithfulness in your call-to-service of the nation.
And it baffled me when a good number of people simply asked the same question in various ways, “Who is handling this document for you?  Does this person know what needs to be done?” I beg to say its impunity when you must know your “way around” before getting the most mundane task done at a government office.


If you have read up to this point you are probably a very concerned Nigerian and not here because of my eloquence for I make no such claim. If on the other hand you work for the CAC and you are concerned, you should be because I speak the truth and the truth may still be able to find strong benefactors in high places.
If you wish to represent me in this matter, I’ll appreciate it because it has been a traumatic experience. If it is arbitration, I welcome it in the interest of the nation. Above all, I’m an advocate of change; a change for the better that is.
I am Kehinde, I run Evince.

The saga ends, 5 months down the line. Part II


SoftMafia said...

I understand you completely SBullet.
I incorporated a company in 9ja. and incorporated another over here...
The difference na 7up.
Naija version you pay hefty sums and deal with lawyers and eventually in about a quarter you get the papers out.
To do a basic name search you pay for each instance of 3 names you want to search etc. why should that be so, it beats me.

Did the same thing here completely online. No need to for lawyers etc. Pay for a month and do name search online jus like you are doing google search with results listed in a grid. as mush as want... in fact..

Anyway, e go better. Diaris God

Ayobami Ologun said...

Silver Bullet,
What a piece to portray what really transpires day-in-day-out in the government parastatals. It is quite unfortunate that this has been the norms over decades, and nobody get them (government workers) checked. All that matters to people is to get paid at the end of the month without any work to show for it. No more conscience. It is my believe that one day, all these shenanigans that go in the public places will be brought to an end, whereby the right thing would be done on time for the people that need the service. By God's mercy, the change we all desire is around the corner. We should keep our hope alive that Nigeria will become great and better in our life time.
Well done job!