Close this search box.
Ghana 1

Firm Details

+ 233 (0) 30 2228906-8
4 Momotse Avenue, Adabraka, Accra
+ 233 (0) 30 222 08901

Ghana: Grace period for compliance with the new Corporate Governance Code

Update by: by Jonathan Amable – Bentsi-Enchill, Letsa and Ankomah, Ghana


The Securities and Exchange Commission of Ghana (the SEC) published the Corporate Governance Code for Listed Companies, 2020 (the Code) on 8 October 2020. The Code applies to all listed companies (i.e. companies whose securities are listed or admitted to trading on any securities exchange in Ghana). The object of this briefing is to highlight some key obligations of listed companies under the Code. Officers of listed companies must apprise themselves with the provisions of the Code and ensure that their companies comply with its requirements by 7 October 2021, which is the commencement date for the implementation of the Code.



The general consensus from the global financial crisis of 2007-2008 and Ghana’s recent financial sector clean-up exercise has been that poor corporate governance was a key cause. Consequently, certain key regulators have focused on issuing industry-wide corporate governance rules to supplement the Companies Act, 2019 (Act 992) (the Companies Act). This approach is based on the view that corporate governance must be tailored for the needs of each business community. It is our expectation that, by issuing the Code, the SEC will strengthen the regulatory framework for listed companies, promote sound governance principles for the administration of listed companies and boost investor confidence in the capital markets. Some key points to note from the Code are summarised in the table below.



1              Scope

The Code applies to all listed companies. As at the date of this briefing, listed company refers to all companies whose securities have been listed or admitted to trading on (for equity securities) the Ghana Stock Exchange (GSE) and the Ghana Alternative Market (GAX) and (for debt securities) the Ghana Fixed Income Market (GFIM) must comply with the Code.


2              Key compliance requirements

2.1          Board composition

The Code (like the Companies Act) does not impose an upper limit for the size of the board of directors of a company (the Board). However, where the directors on the Board are less than 5 or more than 13, the company is required to disclose why the size of its Board is appropriate in its annual report. Majority of the directors must be non-executive directors and a majority of the non-executive directors must be independent (at least two directors must be independent non-executive directors). The chairman of the Board may be one of the independent non-executive directors. The Board must reflect the shareholding structure of the company. Accordingly, the Board cannot not be composed solely of nominees or representatives of the majority shareholder or a substantial shareholder. Further, where there is a single substantial shareholder (but no majority shareholder), majority of the directors must be nominated by or represent the shareholders (other than the substantial shareholder)


2.2          Minority, investor and stakeholder relations

The Board must specify an independent non-executive director as the director responsible for minority shareholder relations. This non-executive director may request the audit committee to review a transaction to consider if it has an adverse effect on the interests of minority shareholders. The Board must also monitor the company’s relationship, and maintain good relations, with its stakeholders. In addition, the Board must appoint a person as the investor relations officer, to act as the liaison between the company and its investors.


2.3          Board charter   

The Code (unlike the Companies Act) requires a listed company to create a board charter that covers the following information and processes:

–     Board responsibilities: the responsibilities of the directors and the secretary

–     arrangement of Board business: the annual schedule of Board meetings, the process for recording Board meetings and disseminating such minutes, and the scope of decisions of the Board and/or its committees

–     evaluation of Board performance: the process for the annual evaluation of the performance of the Board, each director and any committee of the Board. This process should also be published on the company’s website.

–     risk management: allocation of overall responsibility for managing the risks faced by the company (such as technology, human resources, infrastructure, physical premises and internal fraud) and for oversight of the actions taken by the executive to assess and mitigate these risks

–     multiple directorship/re-election: a statement covering the following restrictions (a) each director cannot hold directorship positions in more than 3 listed company at a time, (b) each director who serves more than 9 years may be re-elected but ceases to be an independent director, (c) all directors must have a renewable term of 3 or 4 years, and (d) executive directors must have a fixed term contract, renewable subject performance appraisal and shareholder approval

–     the chairman of the Board and the chief executive officer: a statement covering the following restrictions (a) the 2 roles shall not be held by the same person at the same time (except for limited periods in exceptional cases and with prior approval of the SEC and shareholders), and (b) no person can be chairman of more than 1 listed company at the same time

–     training and induction: appropriate induction programme to orient newly appointed directors and training programme for the Board on an ongoing basis


2.4          Committees

The Code requires the following board committees (in addition to any other relevant committees):

–     Audit committee: made up of at least 3 members, with a majority of the members (including its chairman) as independent non-executive directors. The functions of the audit committee include reviewing financial statements of the company, considering the appointment of an external or internal auditor and making recommendations to the board on financial matters, where appropriate

–     Risk committee: made up of a minimum at least 3 members, with a majority of the members (including its chairman) as independent non-executive directors. The functions of this committee include assessing, reviewing and making recommendations to the board on a risk management strategy for the company.

–     Nominating committee: made up of at least 3 members, with a majority of the members (including its chairman) as independent non-executive directors. The functions of the committee include overseeing the process for the nomination of persons for appointment to the Board, ensuring that the composition of the Board complies with the Code, and succession planning for the chief executive officer and other senior executives of the Board. The nominating committee is required to recommend candidates for appointment as directors to the Board, to enable the Board to nominate candidates for the approval of the shareholders. The Board can only make such nominations after considering the recommendations of the nominating committee.

–     Renumeration committee: made up of at least 3 members, with a majority of the members (including its chairman) as independent non-executive directors. The functions of this committee include recommending a renumeration policy to the Board and overseeing the implementation of the policy.

A company may combine the functions of some of the committees if it is satisfied that such a combination will not create a conflict of interests or impair the effective functioning of a committee. The SEC may order a company to separate combined functions on the basis of conflict of interests.


2.5          Policies The Code requires the Board to adopt and ensure compliance by the company with such policies as a stakeholder policy (regarding the treatment of persons who are affected by the business operations of the company such as employees, creditors and persons who live close to the company’s properties), staffing and remuneration policy, directors’ remuneration policy, conflict of interest policy (which among others requires listed companies to have a register of insiders for the purpose of preventing insider trading), related party transactions policy (regarding the meaning and scope of related party transactions and the procedures for mitigating the risks associated with such transactions) and a director appointment policy (to guide the nomination committee in the appointment of directors)


2.6          Record retention

A listed company is required to keep records of transactions and the company’s financial position for at least 7 years from the date of the matter being recorded.


2.7          Code of ethics  

A listed company must adopt a code of ethics and circulate it to its employees. The code must commit the company to the highest standards of professional behaviour and business conduct. The audit committee must monitor the implementation of the code of ethics and provide a report of the implementation to the Board at least annually.


2.8          Whistle blowing             

A listed company must have a person (nominated by the board) to whom any person may make disclosures in respect of any improper activity of the company or improper behaviour of its management. The process for making such disclosures must also be published on the company’s website.


3              Waivers and exemptions

  • The SEC may waive compliance with all or some or the requirements under the Code for only an external company (if the external company is listed on a foreign exchange and subject to corporate governance requirements in the country of its incorporation or listing) where the SEC is satisfied that (notwithstanding the waiver) such company will still be subject to adequate corporate governance.


  • The SEC may exempt a company from compliance with the portions of the Code which are inconsistent with provisions in the constitution of such company for a period of 12 months from either (i) the expiry of the transitional period (referred to below) or (ii) the date of amendments to its constitution. However, the exemption lapses if the relevant portions of the constitution have not been amended after the expiry of the transitional period.


4              Sanctions

In the event of a breach of this Code, the SEC may impose a penalty of up to GHS 3,600 or such greater amount where the breach also involves a breach of requirements in the Securities Industry Act 2016 (Act 929), for which a higher penalty is imposed.



Explore our news articles, specialist publications and browse through our webinars and gallery

What We Do

Explore our range of expertise, and see how we can help you.
Banking, Finance, Investment Funds & Private Equity
Business Crimes & Investigations
Competition Law
Construction & Engineering
Corporate Mergers & Acquisitions
Cyber Law, Block chain & Technology
Dispute Resolution
General Business Law
Healthcare and Life Sciences
Infrastructure, Energy & Projects
Insolvency & Business Restructuring
Intellectual Property
Labour & Employment
Local Investment Laws and Indigenisation
Media, Broadcasting & Communications
Mining, Environmental & Resources
Property Law and Real Estate

Member Countries

Explore our member firms by country

Burkina Faso
Equatorial Guinea
Guinea Conakry
Ivory Coast
South Africa