Ethical Principles to be considered by an Insolvent Practitioner in corporate Restructuring in Nigeria
In the realm of corporate restructuring, ethical principles serve as the guiding compass for insolvency practitioners (IPs) in their pivotal role. Irrespective of the jurisdiction, these principles remain remarkably consistent, including in Nigeria. These principles underscore the foundation upon which insolvency practitioners must operate, ensuring transparency, trustworthiness, and fair treatment throughout the intricate process of corporate restructuring. There are the key ethical principles to be considered by an Insolvency Practitioner during corporate restructuring in Nigeria:
1. Integrity, Independence, Impartiality: Insolvency practitioners must uphold attributes of integrity, independence, and impartiality. This involves acting honestly, transparently, and without bias. They should have relevant knowledge and experience.
2. Good Faith and Trust: Insolvency practitioners must act in good faith, showing honesty and confidentiality. They must ensure transparency in dealings, including reporting and negotiations. This fosters trust among stakeholders.
3. Best Interests of Beneficiaries: Insolvency practitioners have a duty to act in the best interests of beneficiaries, avoiding conflicts of interest. This includes not profiting personally from their fiduciary role and refraining from activities that compromise beneficiaries’ interests.
4. Independence and Impartiality: Insolvency practitioners should exercise their powers independently and impartially, avoiding biases or influences that might compromise their professional judgment. This is vital to gain stakeholders’ trust.
5. Duty of Care, Skill, and Diligence: Insolvency practitioners must demonstrate reasonable care, skill, and diligence in their actions. Their expertise in insolvency matters raises the standard of care expected of them.
6. Transparency and Disclosure: Insolvency practitioners should disclose any relationships or situations that could impact their independence. Transparency in pre-appointment consultations and throughout the process builds confidence.
7. Protection of Sensitive Information: Insolvency practitioners must maintain confidentiality of sensitive corporate information. This includes not using such information for personal benefit or competing with the company.
In corporate restructuring in Nigeria or any jurisdiction, adhering to these ethical principles is essential for Insolvency practitioners to foster trust, maintain their professional integrity, and ensure the success of the insolvency process.