The Financial Reporting Council of Nigeria (FRCN) has raised concern over the non-existence of sustainability reporting in most sectors of the economy.
Sustainability reporting refers to the disclosure, whether voluntary, solicited, or required, of non-financial performance information to outsiders of the organization, according to Wikipedia.
Nigeria joined the rest of the world to sign Sustainable Development Goals 2013 agenda which attested to the fact that it aligned with global initiatives.
Shuaibu Ahmed, chief executive officer of FRCN, said this recently, during a stakeholder engagement session on ‘Mainstreaming Nigeria’s Collaborative Actions on Climate-Related Risks and Disclosures’, which took place virtually.
Presently, sustainability reporting initiatives existed in silos, he said, adding that businesses are more concerned with immediate profitability without recourse to social and environmental consequences.
Ahmed said a unified sustainable approach is inevitable to ensure that the current needs are met for future generations to meet their needs.
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Adeniyi Adebayo, minister of industry, trade, and investment, said the impacts of climate change were real, stressing the need to appropriately adapt in order to protect livelihoods and mitigate its impacts on the economy.
He emphasized that responding to climate change requires integrated and comprehensive strategies to ensure minimal impacts, adding that risk management within appropriate contexts is required and full climate change exposures are required from the capital market to listed companies.
Adebayo said full disclosure would help investors to make the right decisions before investing, and that it is critical to maintaining the standards of sustainability growth. According to him, understanding and complying with the related issues would raise the bar of transparency and enhance investors’ ability to make informed decisions.
Speaking at the event, Tinuade Awe, chief executive officer of Nigerian Exchange Regulation Limited, encouraged all critical stakeholders to prioritize implementing initiatives that positively benefit the environment and combat climate change.
According to her, NGX regulation has played several roles to promote sustainability reporting. “At NGX regulation, we are committed to fostering the adoption of sustainable business practices and disclosure amongst companies listed on Nigerian Exchange Limited. This is evidenced by our leading role in the development and issuance of the NGX sustainability disclosure guidelines in 2019 which has provided support for companies seeking guidance on sustainability reporting practices,” she said.
Awe noted the increasing global trend in climate-related disclosures and regulations and encouraged companies to incorporate Environmental, Social, and Governance (ESG) factors into their business operations, activities, and reporting processes as a critical step to ensuring that they are positioned to align with the rapidly evolving regulations and guidance on sustainability and climate disclosure.
“In Nigeria, the Federal Government has localized the global call by committing to achieving a net-zero economy by 2060 and signing the Climate Change Act 2021 into law. This policy is consistent with Nigeria’s vision to be a low-carbon, climate-resilient, high growth circular economy that reduces its current level of emissions by 50 percent by 2050, as captured in the 2050 long-term vision for the Nigerian economy which was issued by the department of climate change, federal ministry of environment in 2021″, she said.
