Africa’s 5th largest economy gets a new chief executive

When he was chosen by the godfather of Lagos politics to become the next governor of the city state, no one expected it. Even Babajide Sanwoolu himself didn’t seem to expect he’d be so favoured. The sitting governor could run for a second term in office and no one forfeits that in Nigeria, but Governor Akinwumi Ambode had fallen out with the bigwigs of his party, the All Progressives Congress and most importantly Asiwaju Bola Ahmed Tinubu, the godfather of Lagos politics. Many said he bit the hands that fed him and he had to go.

Lagos now has a new chief executive and his background shows he has what it takes to lead Africa’s 5th largest economy. It’s one thing to be the chosen one, but Sanwoolu proved to Lagosians in less than six months that he deserved their votes, and yes, they gave him massively. The governorship election in Lagos ended in favour of Sanwoolu, who garnered
739,445 votes. His main challenger Jimi Ajagbe could only manage 206,141 votes.

Lagos is the commercial nerve centre of Nigeria; it is where about 55 percent of its value-added tax originates. If Lagos was a company, Governor Ambode is the CEO, Lagosians the shareholders and Tinubu, the Chairman of the board of directors. What happens when the board and the chief executive fall out of love? Usually, one has to go, but when the board chairman is so powerful, the CEO stands no chance.

When a CEO who performed below expectation is ousted, the people who suffered the most — employees and shareholders — often wondered why the board took so long to act. In the current business environment, timely moves to either help or replace a faltering CEO are very important. The competitive landscape is volatile. There are investors eager to exploit any perceived weakness. Hence, the board has to respond to early warning signs before outsiders do. This affords the board enough time to explore the issue and make the right decision. Usually, the right decision is one of three things: support the CEO in dealing with the challenges; coach the CEO, hoping he would improve; or dismiss him before the situation gets worse. In a situation where the CEO has shown disregard for the board, it becomes easy for the board to dismiss him and find a suitable replacement.

This happened in Lagos.

Lagosians were groaning under a sudden rise in traffic jam across the city state. An allegedly sabotaged environmental management plan also saw waste litter the streets of Lagos. There was also the controversial land use charge which was hiked by more than 200 percent. While he invested in infrastructure, it was as though he forgot how well he had to perform in other areas.

In an ideal situation, the State House of Assembly would be the board, with the powers to remove a faltering CEO. However, politics in Lagos is run differently. If the ruling party has parliamentary majority, the governor will be safe until he’s at loggerheads with the godfather, who is most likely to be consulted by the House of Assembly before a major decision like the governor’s removal is taken. While Governor Ambode takes one misstep after the other, the House of Assembly did little or nothing to caution him and things were almost at a point where “activist investors” would pounce, showing voters why the governor would not deserve a second term and why a takeover is the only way to save Lagos. If he was in a good place with the leadership of his party and the man that chose him, like a board would do for a faltering CEO, Governor Ambode would have gotten the support he needed to retrace his steps and reassure Lagosians that he would still come good. But he had lost everything.

Babajide Olusola Sanwo-Olu is an alumnus of the prestigious Harvard Kennedy School of Government, London Business School and the Lagos Business School. He also earned a Bachelor’s degree in Surveying & Geo-Informatics and a Master of Business Administration (MBA) from the University of Lagos.

After Tinubu declared his support for Sanwoolu, he explained why. Governor Ambode had lost the support of the party.

“Who did I support in 2014? Ambode. Life is dynamic. It’s those who made me the leader of the structure in Lagos who said it was what they want.

“Ambode Akin, he’s doing well, yes; he hasn’t been a good party man; not only the glamour, not only about brick and mortar. A talent is determined by character. For you to become an influential person, you have to respond to the yearnings of the people. This is politics; democracy, one man, one vote,” Tinubu said, laying out Ambode’s flaws.

After losing the support of his godfather, he made another wrong move trying to discredit the man chosen to succeed him. He failed, losing at the party primaries to Sanwoolu.

Sanwoolu was the chosen one and the other major candidate for Lagos gubernatorial race sometimes seem disinterested. He could have easily won. But Sanwoolu launched a massive campaign, more than anything Lagos had ever seen. Apart from his frequent media appearances, his campaign posters were everywhere in Lagos, even on helium-inflated balloons floating in the air. This virality continued online. If there was anyone who did not know Sanwoolu before the election, the person was probably never in Lagos. If you still had doubts about his capability to lead a state with a GDP of $136 billion, Sanwoolu ensured you heard him and saw him. In January, he was in Davos for the World Economic Forum. He also took Twitter seriously, taking on questions about his plans. His team also ensured everyone knew about his banking background and his public service achievements.

As the governorship election drew closer, Sanwoolu was able to show how passionate he was about becoming the governor of Lagos State. He made believers out of many who initially doubted his capabilities. Even members of the opposition who only perceived him as a stooge to Tinubu ended up seeing him as a smart one.

Tinubu has been fiercely criticized for his hold on Lagos politics and is likely to face more opposition in the near future, but for now he has given Lagos Sanwoolu and Lagosians would hope he comes good. But power can corrupt or worse, damage the brain.

In 2017, management expert Jerry Useem, in an article published on the Atlantic with the title ‘ Power Causes Brain Damage’, described several studies on the effect of power on the brain.

“Once we have power, we lose some of the [mental] capacities we needed to gain it in the first place,” he wrote. Dacher Keltner, a psychology professor at UC Berkeley, found in studies done over 20 years that his subjects under the influence of power acted as if they had suffered a traumatic brain injury—becoming more impulsive, less risk-aware, and, crucially, less adept at seeing things from other people’s point of view. This helps explain why some chief executives lose some of their effectiveness after landing the top job, Useem wrote.

Lagosians will be hoping Sanwoolu is able to keep a cool head when he assumes office. The governor-elect had said Lagos needs to set a new management standard. “We need to recalibrate the economy of the state and make it competitive,” he told journalists ahead of the election. He also promised to fight poverty by investing more in education and health.

“Currently, we do about 8 percent budgetary allocation to education; we will see how we can push it up to about 15 percent in the next four years. Same with health. We need to cover a lot of the vulnerable and poorest Lagosians under our Health Insurance Scheme. I believe if we do well in education and health, we will be guaranteeing the future of the children and Lagos State.”

Sanwoolu will be sworn in on May 29.