Government Needed to Call an EGM of Shareholders to Fire SIC Boss, the Companies Act Suggests

The government of Ghana would have needed to call an emergency general meeting (EGM) of shareholders to secure a majority vote before removing the Managing Director (MD) of SIC Insurance, Hollistar Duah-Yentumi, as suggested by the Companies Act.

Since SIC Insurance operates as a limited liability company, its actions are governed by the Companies Act, 2019 (Act 992), which replaced the former Companies Act, 1963 (Act 179).

Originally established as a statutory corporation known as the State Insurance Corporation, SIC was later converted into a company limited by shares under the Statutory Corporations (Conversion To Companies) Act, 1993 (Act 461). SIC is now listed on the Ghana Stock Exchange as a public company, and as such, the appointment and removal of its directors—including its managing director—are subject to the approval of shareholders under the Companies Act.

This means that no single entity, including the government, can unilaterally remove a director. Instead, an EGM of shareholders must be called, and a vote must be held. Given that the government holds 40% of the company’s shares and the Social Security and National Insurance Trust (SSNIT) holds an additional 11.82%, the government could likely gather enough votes to remove Duah-Yentumi.

The longstanding practice of removing heads of listed companies or companies with significant government ownership by executive fiat has been used by several governments over the years. However, this case could set a precedent, challenging the practice in favor of proper corporate governance.

In her lawsuit, Madam Duah-Yentumi is not seeking reinstatement but is instead claiming payment of the salaries due her as if her employment had not been terminated and her benefits as well.

The debate over the appointment and removal process for managing directors of listed State-Owned Enterprises (SOEs) has gained renewed attention, particularly after Duah-Yentumi refused to hand over her office to the newly appointed MD, James Agyenim-Boateng.

Madam Duah-Yentumi, who was appointed under the previous New Patriotic Party (NPP) administration, reportedly locked her office, delaying the transition and complicating the process for Agyenim-Boateng, who was appointed by President John Dramani Mahama as Acting Managing Director on January 24, 2025. This has impacted SIC’s operations as the matter now awaits a legal resolution.

Source:thehighstreetjournal.com