The Executive Chairman, Federal Inland Revenue Service, Mrs. Ifueko Omoigui-Okauru, has said that lack of knowledge and low level of professional portfolio management services are partly responsible for the stock market’s crash of 2008 and 2009.

She stated this during the maiden national conference of the Portfolio Management Institute, titled, “Portfolio Risk Management in the Nigerian Economy”, in Lagos on Friday.  Omoigui-Okauru was represented by Alhaji Abdullahi Attah.

According to Omoigui-Okauru, one of Nigeria’s challenges over the years is its inability to effectively manage risks of all sorts, whether in the public or private sector.

“We would have been much closer to achieving the level of development, which we all aspire as a nation, if we had placed more emphasis on risk management in all areas of our economy,” she said.

She, therefore, advised organisations to focus on risk assessment to attain a sustainable and effective economy in the country.

In the same vein, the President, PMI, Mr. Andy Ekwogwu, urged organisations to give attention to portfolio management risk in the country towards ensuring that the Nigerian economy achieved its aim of a world-class standard.

He said not paying attention to risks in business organisations was one of the reasons organisations chose projects that destroyed their businesses.

He said, “The crisis in the financial market, terrorism, political upheavals, natural disasters, court liability rulings and other problems affecting organisations are results of the attitude of the management of organisations towards risk.”

 According to Ekwogwu, this will serve to bring the Nigerian economy into limelight and help attract more foreign investment into the country.

He noted that many organisations focused on security, quality assurance, liquidity and insurance, rather than adequately addressing risks in choosing projects. This, he said, had led many establishments into disaster.

Ekwogwu said more focus was needed on risk management due to the competitiveness of the economic environment, which put pressure on managers to produce more, adding that projects were becoming complex because of the advancement in technology and increased regulatory requirement and increased product liability.

He also noted that there was greater dependence by organisations on multiple business partners.

Source: Punch/Benedicta Bassey