Pacta sunt servanda, by Simbo Olorunfemi

Following on the Sujimoto-Enugu State Government saga, one Real Estate player put up a post on two Nigerian Entrepreneurs, misrepresenting the story of Damola Adamolekun, CEO of Red Lobster as an entrepreneur whose company filed for bankruptcy after a $1 billion loss, and then turned it around, lamenting that while was the case in the US, Nigerians were being hard on Sujimoto over what he claimed to have been a $50 million loss in business. To him, the two cases were just about ‘challenges in business’ and the issue of integrity doesn’t come in.

This gentleman not only misrepresented the story of Damola Adamolekun as one of these dodgy entrepreneurs (Is he even an entrepreneur or a turn-around Expert?) who hide under the cover of bankruptcy to throw the short end of the stick at I know investors and creditors and then move on. He then proceeded to downplay the place of integrity.

What I don’t even get is the connection between the Sujimoto v Enugu State case and the so-called $50 million loss in business that the real estate man threw in.

The allegation out there has to do with an N11 billion contract of which 50% of contract sum had been paid and there is nothing substantial on ground to show for it. What has that got to do with a $50 million loss in business and a 2-year project running into 5 years? How is this issue not one of integrity?

He says integrity didn’t save Joseph from prison? Really? If he hadn’t been put in prison on account of his sense of integrity, how/where would he have met the Butler who introduced him to Pharaoh?

A man in business playing down on the place of integrity is a red flag.

It’s either times have changed or simply that we see things differently

From my little experience in business, government contracts, tricky as they can be, usually come with high mark-ups, which can be ‘explained’ to the uncertainty that often hang around payment.

I won’t be surprised if a government contract carries as much as a 40-50% profit margin.

With a 50% upfront payment for a 6-months contract, except there is a case of force majeure, I will see that project to completion, even if it requires taking a loan, and pursue payment immediately after.

I will see it as an opportunity to make a name for delivering on schedule, while not compromising quality and value.

True, some people take advantage of people delivering on time by cheating or not even paying. That is often the case for those us who render professional services, where it becomes a tug of war receiving payment after the job is done. You even have cases where someone is asking – What did you even do?

But that has not stopped us from being led by our values. For me, until the eggs are hatched, there is no point planning around them. Profit can only be said to have been made when money has finally come in. Until a project is done and payment received, every form of gratification is delayed.

People say pay yourself first. When it comes to projects, I pay myself last. Materials first, personnel next. Even when payment comes, the business must benefit through investment in equipment and whatever else before I can indulge myself in any form of gratification.

Well, that’s me though. It probably works for others differently.

While not privy to the details of this case, again, from my experience, working on a government project/contract, you have to be careful, otherwise greed and people in government, especially civil servants, will lead you into trouble.

Years back, there was this project I was commissioned to execute by a state government and we were to deliver X units. One of these days, I was approached by the DFA, advising that we deliver less than X units, that he had already spoken to the Auditor and other people, that there would be no problem.

I smiled and tactically waved it off. We delivered in full, as commissioned to do. Na person wey dem go put for trouble dem dey find. If you follow their lead, when yawa gas, they will remind you of how many years they have been in service, and how they stand to lose everything. They will want you to take the fall alone. Resist greed. Flee temptation.

One would think that some of the points here should be rather obvious, but you can’t read some of the comments on the page of the Real Estate man and not be concerned, if not scared.

Many apparently saw sense in his misrepresentation of Damola’s story, or maybe they don’t know the true story. But what about his playing down on the place of integrity?

There is no doubt that business comes with challenges, some not outrightly the fault of the one who has been contracted to work. Unusual circumstances can come to rock the foundation of a business. A drastic drop in oil price and exchange rate, as experienced by Femi Otedola. The dramatic change in fortune for businesses in Nigeria with commitments in foreign currency, as witnessed in Nigeria last year.

Even then, there is a way to hedge against risks. There is a place for insurance.

But beyond that, there are instances of force majeure, acts of God, which will be quite obvious to everyone. War, earthquake, terrorist attack…

But there is no denying the fact that agreements are sacrosanct. Pacta Sunt Servanda. Agreement is agreement. While the principle/dictrine of rebus sic stantibus can pave a way for escape from validly executed agreements, that is an exception, not the rule.

In Minister Nyesom Wike’s voice, agreement is agreement. Again in his voice, people must have integrity.

You can’t hide under the cover of challenges in business to play ludo with other people’s money and come lamenting that there is no umbrella of bankruptcy for cover.

Integrity matters.