By Aduragbemi Omiyale
The chief executive of the Nigerian Exchange Regulation Limited (NGX RegCo), Ms Tinuade Awe, has disclosed that about 50 per cent of listed companies on the bourse have fully integrated sustainability reporting into their annual reports or have released dedicated standalone reports.
She said this during a roundtable themed ESG Activity Reporting and Sustainable Investing at the Africa Social Impact Summit 2023, hosted by Sterling One Foundation and the United Nations Nigeria in Lagos recently.
At the event, she advised organisations to incorporate Environmental, Social, and Governance (ESG) considerations into their overarching business strategies, emphasising the importance of publicly-quoted firms aligning their ESG reporting with their business objectives, data management, and governance practices.
Explaining how companies can integrate ESG factors into their financial reporting, she noted that businesses aiming to engage in ESG reporting must establish a clear ESG strategy that aligns with their business goals.
She urged these companies to seek expert guidance and systematically monitor ESG-related data to facilitate accurate reporting, emphasising that this approach is pivotal in encouraging prompt adoption of ESG reporting among NGX-listed firms.
Ms Awe stressed that companies that successfully integrate ESG reporting into their operational framework are considered responsible corporate citizens, as such companies are better equipped to mitigate operational risks, attract sustainable investors, and generate long-term value.
She pointed out that the practice of ESG reporting will enhance Nigeria’s global standing in terms of ESG performance and reputation. She urged corporate entities to embrace this initiative, as it would contribute to Nigeria’s aspiration of achieving carbon neutrality by 2060.
Responding to questions about potential penalties for companies that fail to adopt ESG reporting, Ms Awe noted that NGX has sustainability disclosure guidelines that became effective in 2019.
However, she indicated that these guidelines would be reviewed in accordance with the emerging International Sustainability Standards Board (ISSB) Standards alongside the evolving landscape of global ESG expectations.
In light of the rapidly evolving global ESG landscape, Ms Awe stressed the necessity for a deliberate partnership between both public and private sector stakeholders in Nigeria, as this would enable them to embrace their shared responsibility in building a sustainable future.
She noted that ESG reporting not only raises awareness of worldwide trends in climate-related reporting but also aligns with established guidance frameworks such as the Task Force on Climate-related Financial Disclosures (TCFD) recommendations and the recently introduced International Sustainability Standards Board (ISSB) S1 and S2 standards.
