…raises concern over ethical risks in AI-driven financial reporting
The Financial Reporting Council (FRC) of Nigeria has emphasised the urgent need for integrity-driven reforms across the financial ecosystem to strengthen public trust, market stability, and national development.
Speaking at the 55th Annual Accountants’ Conference of the Institute of Chartered Accountants of Nigeria (ICAN), Rabiu Olowo, executive secretary/chief executive officer of the FRC, represented by Titus Osawe, coordinating director, Directorates of Corporate Governance and Inspections & Monitoring, said ethical leadership remains the bedrock of accountability and economic transformation.
He described ethical leadership as the consistent demonstration of integrity, transparency, accountability, and moral courage in decision-making, noting that it goes beyond compliance to doing what is right even when no one is watching.
Olowo warned that when ethical judgment fails, the consequences extend beyond individuals to institutions and entire economies. He recalled both global and domestic financial scandals that stemmed from weak governance and unethical behaviour.
“At its core, ethical leadership is the consistent demonstration of integrity, transparency, accountability, and moral courage in decision-making. It goes beyond compliance. It is about doing what is right, even when no one is watching.
“In the accounting profession, ethical leadership is not only desirable but indispensable. We are custodians of truth in financial reporting, stewards of public trust, and sentinels of corporate accountability. The choices we make in boardrooms, audit committees, ministries, and firms influence investor confidence, policy direction, capital flows, and ultimately, the credibility of our markets.
“In the accounting profession, ethical leadership is not only desirable but indispensable. We are custodians of truth in financial reporting, stewards of public trust, and sentinels of corporate accountability,” he said.
Highlighting the Council’s mandate, the FRC boss said the agency continues to promote ethical conduct through standard-setting, registration and oversight of professionals, investigation of misconduct, and enforcement of corporate governance codes such as the Nigerian Code of Corporate Governance (NCCG) 2018 and the Audit Regulations (2020).
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He also noted that the adoption of the International Sustainability Standards Board (ISSB) framework marks a significant step in institutionalising transparency and accountability in corporate disclosures, particularly in the area of environmental, social, and governance (ESG) reporting.
On emerging issues, the FRC raised concern over the ethical risks associated with artificial intelligence (AI) and digital transformation in accounting and auditing.
“Algorithms can’t replace ethics. As digital tools and AI reshape financial reporting, the ethical use of data and technology is becoming a growing concern. Professionals must ensure that innovation does not erode integrity,” Olowo stated
He also warned against regulatory arbitrage, greenwashing, and the misuse of digital assets, urging accountants to remain vigilant and uphold ethical standards even in fast-changing financial environments.
Reaffirming the Council’s commitment to deepening ethical culture, Olowo said the FRC is advancing initiatives to embed ethics into corporate reporting frameworks, strengthen collaboration with regional and global regulators, and introduce new governance codes for the public and not-for-profit sectors.
