Journalists charged on responsible coverage reporting of the capital market

SEC 4&8:-L-R, President, Chartered Institute of Stockbrokers, Mr Adedapo Adekoje, Incoming Chairman, Capital Market Correspondents Association of Nigeria (CAMCAN), Mr Chinyere Joel-Nwokeoma, Acting Director General, Securities and Exchange Commission, Ms Mary Uduk and Acting Commissioner Corporate Services SEC, Mr Henry Rowlands during the SEC Journalist Academy 2018 held in Uyo, Akwa Ibom State

The role of journalists in the development of the Nigerian capital market has been identified as critical and indispensable.

Olisa Egbunike, a journalist, who recently retired from the service of the News Agency of Nigeria (NAN) as Deputy Editor-in Chief, made the observation at the 2018 edition of the Securities and Exchange Commission (SEC) Journalists Academy, which held in Uyo, Akwa Ibom State.

The SEC Academy is a workshop organized regularly by SEC to help deepen the understanding of journalists covering the capital market on developments within the sector. The workshop was declared open by SEC Acting Director General, Ms. Mary Uduk

Egbunike, whose paper was titled, “The role of responsible journalism in capital market reporting”, stated that the role of financial journalists in the financial industry, with specific reference to the capital market in today’s high-frequency information highway shows that there is a huge gulf between the ideal active watchdog role and the actual role. Furthermore, the process of news gathering, processing and delivery of financial news has been found to be self-referential within the financial system, leaving little room for alternative voices.

Egbunike wants capital market reporters to show greater responsibility in their coverage of the capital market

He said the influence of regular financial coverage of the stock market remains limited but contingent on various factors such as unexpected economic policy, national/international economic status, corporate profiles, quality of management and news about corporate mergers. In the same vein, the proliferation of online news platforms have generated serious concerns regarding the abuse of journalism values, with particular emphasis on the daily reportage of the financial industry.

“In today’s high-frequency stock market and the general financial district, discussions about fake news and accusations against financial journalists have been heightened. We have been severally accused of failing to comply with our watchdog function before and during the global financial crisis of 2007 to 2008. That concern, especially in Nigeria with regards to our complicated economic recession, raises questions about the role of financial journalism and journalists.

“Furthermore, in an era in which automated news production and high-frequency trading based on algorithms have entered the stage, one starts to wonder how financial journalists contribute in today’s financial markets. How financial journalists relate with other financial actors in the financial districts toward the dissemination of financial information and their role impact on the economy make it imperative for the practitioners to take full responsibility in the overall management of financial information,” Egbunike said.

He stated that more than 10 years after the global financial crisis, journalism and communication scholars are still seeking for a new and comprehensive role for financial journalism. He said current developments, such as automation and the growing pressure within the news industry, demand a new reassessment of the role of financial journalism and responsibility in reporting of the financial industry.

“The recent upheaval in the financial news industry raises questions on our professional status in Nigeria, especially after the 2015 elections and the sustained decline in economic indices between then and today.

“Outside the constitutional provision in the 1999 constitution as amended and as contained in sections 22 and 39 on press freedom, the Investment and Securities Act (ISA), the bible of the capital market did not provide any role or confer any responsibility on the practice of financial journalism and journalist. What it means is that financial journalists have no option but to adapt the right to hold regulators, operators, investors and government accountable. The indispensable role of the press in moulding and shaping the financial society has today not diminished but rather grown and expanded the frontiers of wealth creation, financial inclusion and economic emancipation of Nigerians.

SEC Acting DG, Ms Mary Uduk with senior officials of the commission at the SEC Journalists Academy in Uyo

“However, as a practicing reporter, the role of responsible journalism in the capital market, is the compelling imperative for all of us to develop the skill of information management. As capital market or financial reporters, we must always exercise caution, maturity and exhibit professional candour in reporting issues emanating from the capital market and the financial district. The sensitive character of the financial industry and wealth creation, challenges us always to have it at the back of our minds that financial news item, no matter how insignificant it might appear, is a bankable product with inherent and intrinsic value,” Egbunike stated.

Cross Section of the Participants at the SEC Journalist Academy 2018 held in Uyo, Akwa Ibom State
Egbunike said the belief by capital market reporters that their our role and responsibility of covering the capital market are not different from covering politics and sports among other beats, and the insistence that their primary concern is accurate and clear reporting is misleading as it makes them less concerned about the consequences of published investment news items.

“As financial journalists, such approach may result in shoddy journalism and cause confusion for the investing public. I assert that it is not sufficient to be accurate and clear when covering capital market issues. Capital market reporters have the responsibility to mirror the nation’s investment needs, issues comprehensively and proportionally. Often that doesn’t happen in the capital market.

“In one of my recent lectures, I did submit that capital market reporters have the special responsibility of covering investment and economic news. My argument stemmed from the fact that the investing public depends on the analysis and investigation of capital market reporters to make informed investment decisions and to a large extent wealth creation,” he noted.

He said Nigeria’s current national economic challenges foist on capital market reporters the responsibility to investigate and report the possible conflicts of interest among operators and the regulators. He said that as “quasi” investment experts, capital market reporters must always have it at the back of their minds that such conflicts may not be readily apparent, and so they must look for them as a routine part of story research and interviews.

“We must investigate and report the possible links between various individuals operating in the regulatory environment, investment institutions, shareholders and government agencies with oversight functions for insider trading.

“Our abdication of this responsibility means that we will unwittingly become the mouthpiece of biased and corrupt vested interests in the whole gamut of the nation’s financial industry.
Indeed, capital market reporters face unique challenges in covering the headquarters of capitalism. What it means therefore is that we need to acquire specialized skills, knowledge, and judgment in our daily approach to issues. Editors and reporters need not limit their scrutiny to terminologies used in investment news, but the logic and spirit behind it. Vague, sensational terms may harm news consumers by misleading and misinforming them and may lead to economic depression and possible crash of the capital market,” Egbunike stated.

He stated that whilst it is not the role of capital market reporters to become advocates for causes, it is their responsibility to investigate and report on investors’ needs as they struggle to understand and navigate the Nigerian investment terrain.

“Investors need help in understanding the ways in which regulators and operators arrive at various investment conclusions. In that sense, there is an inherent educational role that capital market reporters must assume,” he said.