Stakeholders Suggest Ways to Fast-track Growth of Impact Investing in Nigeria

By Modupe Gbadeyanka

The Nigerian government has been advised to formulate strong policies and incentives to attract more impact investments in the country.

These and other recommendations were given at a stakeholder validation workshop organised by the Nigerian National Advisory Board for Impact Investing (NABII) in partnership with the Nigerian Economic Summit Group (NESG).

The event was themed Investing for Impact in Nigeria: A deep dive into Agriculture, Education and Health Sectors, and it was aimed at unlocking the country’s impact investing potential with a focus on the agriculture, education and health sectors.

The initiative was made possible with support from the Global Steering Group for Impact Investment (GSG), OTT Impacto and financed by the International Development Research Centre (IDRC).

The seminar was used to unveil the findings of the report and gather expert opinions and feedback on areas where the deep dive research report could further be improved.

The Vice Chair for NABII, Mr Afolabi Oladele, while presenting his keynote address at the event, expressed confidence in the findings of the study, saying it would bridge the information gap for impact investing in Nigeria and accelerate its growth.

The expert panel session, moderated by the chief executive of the Impact Investors Foundation, Ms Etemore Glover, had the Vice President, Financial Markets, AFEX Commodities Exchange Limited, Oluwafunto Olasemo; the founder of Teesas, Mr Osayi Izedonmwen; the Chairman/Medical Director of ECHOLAB Radiology and Laboratory Services, Dr Ayodele Cole Benson; the Director of Partnership and Coordination of Small and Medium Enterprise Development Agency (SMEDAN), Dr Friday Okpara; and the Executive Director of Policy Innovation Centre at NESG, Dr Osasuyi Dirisu.

They discussed the high-level findings of the study, provided deep insight into issues in the various sectors and highlighted potential policy recommendations for developing an inclusive and gender-balanced impact investing market in Nigeria.

Olasemo emphasized the need for capacity building for all stakeholders, particularly MSMEs, investors and policymakers to fast-track the growth of the impact investing ecosystem.

Izedonmwen noted that investors needed to get educated on the viability of impact investment and why it was important to allocate funds from Development Finance Institutions and pension funds to impact investments, adding that social enterprises need to realize that the funds they received are meant to generate profit and social impact.

Sharing his perspectives on the health sector, Benson noted that a weak governance structure, poor financial accountability systems and low-profit margin in most private healthcare facilities are limiting access to funding, adding that the operators in the sectors require financing with a long-gestational period.

Dirisu advocated policies that would increase the participation of women in impact investing while ultimately creating a more equitable society for all men and women.

Commenting on the plight of MSMEs in the country, Okpara stated that access to capital is a major impediment to business growth and called for policies that would enhance their businesses and improve access to finance.

The collaborative study revealed a $186.17 billion financing gap in Nigeria’s agriculture, health and education sectors.

The research identified key investment instruments for MSMEs operating within the agriculture, healthcare and education sectors, with gender and sustainability as the cross-cutting guiding principles. Some of these instruments include low-cost debt financing, grant, equity and hybrid financing (debt and grant).