By Aduragbemi Omiyale
Investors have been advised to begin to consider investors in equities that are compliant with Environmental, Social, and Governance (ESG).
The Divisional Head of Capital Markets at Nigerian Exchange (NGX) Limited, Mr Jude Chiemeka, stressed that there is a significant correlation between ESG disclosures and corporate performance.
According to him, investing in ESG stocks give investors the opportunity to receive transparent and high-quality disclosures, which are critical in making sound investment decisions.
“Companies on the exchange with strong ESG compliance often gain access to more capital, attract a broader investor base, and can even raise capital from foreign markets.
“The NGX Premium Board features companies that adhere to international best practices on corporate governance and meet NGX’s highest standards of capitalisation and liquidity.
“Compliance is not only a matter of prestige but also an indicator of sustainable growth, making these companies more appealing to both international and domestic investors,” he said at a panel session titled ESG and Sustainable Finance; The Future of Investments.
Speaking at the event jointly organised by the Securities and Exchange Commission (SEC) and the Financial Centre for Sustainability in Lagos on Thursday, Mr Chiemeka highlighted the importance of ESG compliance and the democratisation of data in attracting investments and enhancing stock liquidity in the Nigerian capital market.
Whilst noting that NGX is a member of the Sustainable Stock Exchanges Initiative, he emphasised the bourse’s strong focus on technology, which facilitates investor access to essential data.
According to him, seamless access to various products in the capital market is crucial, especially for retail investors.
He also commended the SEC for its efforts in establishing a sustainable finance framework, especially in regard to green bonds.
“Nigeria’s issuance of a green bond solidified its position as the first sovereign country in Africa to do so, and we applaud the SEC’s role in making this possible,” he said.
