Economy
Yuguda Proposes Robust Sustainability Ratings to Attract Investors
By Aduragbemi Omiyale
The Director-General of the Securities and Exchange Commission (SEC), Mr Lamido Yuguda, has proposed the development of robust sustainability ratings and indices to track the performance of companies in the area of Environmental, Social and Governance (ESG) so as to attract investors in the green sector.
He said with the design of the sustainability ratings and indices, conscious investors would have available materials and information to help their investment choices.
Mr Yuguda also reiterated the need to facilitate the issuance of green and sustainable instruments in the Nigerian capital market, saying it will go a long way to assist in financing solar energy and other environmentally friendly infrastructure.
“Another important step in the journey of promoting sustainable investment principles is the development of robust sustainability ratings and indices to track companies’ ESG performance.
“This will further assist ESG conscious investors in making their investment choices. It will also simplify for investors and other stakeholders the process of analyzing information disclosed by issuers on sustainable finance,” the SEC DG said at an ESG roundtable themed Unlocking Value Through ESG Investing organised by the CFA Society Nigeria last Thursday.
He also tasked state governments to take advantage of the growing appetite to issue bonds to finance relevant environment-friendly projects, especially those that are revenue-generating and with reasonable social impact.
In Nigeria, only the federal government and a few corporate organisations have issued green bonds. The market is still largely untapped.
“Companies will also need to continuously disclose relevant information on their adoption of ESG principles. Such information will be critical for the investing public to make informed decisions about available investment choices and guide their asset allocation,” Mr Yuguda said.
According to the SEC Boss, given the global interest in ESG and the quantum of finance available to corporates and countries adopting the relevant principles, Nigerian issuers, governments and corporates, regulators, exchanges and other key stakeholders need to collaborate more to develop and issue necessary instruments to attract additional foreign capital into the country.
“With the enhanced focus on ESG considerations, much effort is now geared towards the preservation of biodiversity, climate change mitigation and adaptation, inclusiveness, reduced inequality, human capital and communities’ development, among others.
“Given the important position of the financial sector in the economy, one can understand why these issues are accorded high priority in the sector and why the sector has begun to consider sustainability in its practices.
“Sustainable finance has become a global brand as the world stands strongly together to promote the transition to a low-carbon, more resource-efficient economy and to build a financial system that spurs sustainable growth across nations.
“As we are all aware, finance has an enormous influence on sustainability; with players in the financial sector acting as catalysts for redefining the natural and business environments. They help support the transition from exploiting nature to restoring and maximizing nature’s valued gifts. Investing in sustainable instruments, therefore, has far-reaching benefits, further justifying why ESG advocacy and practices are gaining more popularity,” he stated.
The SEC chief said that as securities regulators, whose core mandate is to ensure investor protection, by maintaining fair, efficient and transparent markets and reducing systemic risks, his agency believes this role can further be harnessed through sustainable finance; and pledged to continue to strongly support the adoption of ESG principles and collaborate with relevant stakeholders to drive sustainable finance initiatives.
“I am really pleased and encouraged by the interest shown in ESG by the CFA Society Nigeria. I am also glad to inform you that the commission will be willing to collaborate further with the society on ESG and other relevant issues.
“With the quality of the membership of the society and the resources available to it, I am confident that such collaboration will result in positive outcomes for the Nigerian capital market and the economy as a whole.
“I have no doubt that collectively we will chart a common course for sustainable finance in the country that will be beneficial to the economy and the Nigerian people,” he added.
In her address, President of the CFA Society Nigeria, Ms Ibikun Oyedeji, explained that the webinar was organised in continuation of the association’s mandate of promoting global best practices for the investment industry, and to serve as a stimulus to advocate and promote awareness in Nigeria and Africa as a whole for the incorporation environmental, social and governance factors in business decisions and product development.
Ms Oyedeji stated that the webinar also provides an opportunity to accelerate the progress and demonstrate the purpose through responsible investing and aimed at equipping the practitioners and other stakeholders within our community with the right tools to navigate this evolving terrain.
She said, “The theme of the round table unlocking value through ESG investing implies that an untapped opportunity exists in business beyond profitability.
“Our clarion call today to the investment management industry is to put measures in place to ensure that product and services contribute to the sustainable development of our environment, employee working conditions, labour right, diversity discussions become our forefront while transparency and openness provide long term benefit for shareholders and our stakeholders are widely impressed.
“ESG factors have become increasingly important to institutional investors and there is a rising need for us invested professionals, regulators and other stakeholders to build a capacity in ESG focus investing which will remain relevant. This round table serves as a foundation for building the sustained effort in developing our local capacity in ESG investing.”
Ms Oyedeji said the CFA institute through the principle of responsible investing has created a best practice report and regions specific report that focuses on the Nigerian region to help investors understand how they can better integrate ESG factors into their equity, corporate funds and even the sovereign debt portfolio.
By Dipo Olowookere
About 0.04 per cent was recovered on Friday from the loss recorded by the Nigerian Exchange (NGX) the previous due to profit-taking.
Yesterday, investors were in the market with renewed vigour, mopping up stocks trading at relatively cheaper prices.
According to data, the insurance counter gained 0.41 per cent, the banking sector appreciated by 0.38 per cent, and the consumer goods index grew by 0.14 per cent.
The gains achieved by these three sectors were enough to lift Customs Street at the close of business despite the 0.26 per cent decline printed by the industrial goods segment and the 0.14 per cent loss suffered by the energy industry. The commodity counter was flat during the session.
A total of 43 equities gained weight on the last trading day of this week, while 26 equities shed weight, indicating a positive market breadth index and strong investor sentiment.
Red Star Express increased its share price by 10.00 per cent to N13.20, NCR Nigeria grew by 9.97 per cent to N128.55, SCOA Nigeria inflated by 9.96 per cent to N14.90, Omatek appreciated by 9.94 per cent to N1.77, and Deap Capital expanded by 9.85 per cent to N4.46.
On the flip side, McNichols decreased by 8.81 per cent to N6.00, Legend Internet crumbled by 7.56 per cent to N5.50, Cornerstone Insurance crashed by 6.48 per cent to N6.35, C&I Leasing contracted by 6.29 per cent to N8.20, and Austin Laz slipped by 5.78 per cent to N3.75.
Yesterday, 539.9 million shares valued at N16.7 billion were transacted in 48,023 deals versus the 1.0 billion shares worth N31.6 billion executed in 51,227 deals in the preceding day, implying a shrink in the trading volume, value, and number of deals by 46.01 per cent, 47.15 per cent, and 6.26 per cent apiece.
Zenith Bank was the most active for the day with 54.6 million stocks sold for N3.8 billion, Jaiz Bank traded 41.5 million units worth N359.4 million, Secure Electronic Technology transacted 37.7 million units valued at N39.2 million, Access Holdings exchanged 30.5 million units for N699.2 million, and Lasaco Assurance transacted 27.2 million units worth N68.3 million.
When the market closed for the day, the All-Share Index (ASI) went up by 72.21 points to 166,129.50 points from 166,057.29 points and the market capitalisation gained N31 billion to N106.354 trillion from N106.323 trillion.
By Adedapo Adesanya
It was a positive ending for the Naira this week after it further appreciated against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, January 16 by N1.33 or 0.09 per cent to sell for N1,417.95/$1 compared with the previous day’s N1,419.28/$1.
The domestic currency also gained N2.41 against the Euro in the official market to close at N1,647.51/€1 versus the preceding session’s closing price of N1,649.92/€1, however, it suffered a N7.97 loss against the Pound Sterling in the same market window to trade at N1,901.32/£1, in contrast to Thursday’s closing price of N1,893.35/£1.
In the same vein, the Nigerian Naira depleted against the Dollar at the GTBank FX counter by N2 to quote at N1,427/$1 compared with the previous day’s N1,425/$1, but strengthened against the greenback at the black market yesterday by N5 to settle at N1,485/$1 versus the N1,490/$1 it was exchanged a day earlier.
Improved supply conditions helped keep the market within range as exporters’ and importers’ inflows in addition to non-bank corporate supply enhanced liquidity as the Central Bank of Nigeria (CBN) made no visible intervention.
Stronger external inflows from foreign portfolio investors (FPIs) and improving current account dynamics, continue to align with structural support in the wider economy.
Nigeria has seen projections of a stronger economic or gross domestic product (GDP) growth and lower inflation in 2026, with these forecasts citing improved macroeconomic fundamentals and reform impacts.
As for the cryptocurrency market, it was mixed following selloff in precious metals and lower US stocks appeared to be denting crypto sentiment.
Gold and silver, both of which also enjoyed big rallies earlier this week, tumbled 1.2 per cent and 5 per cent, respectively while key US stock indexes — the Nasdaq, S&P 500 and Dow Jones Industrial Average — all reversed from early gains to modest losses in Friday trade.
Dogecoin (DOGE) shrank by 2.2 per cent to $0.1370, Ripple (XRP) slipped by 0.8 per cent to $2.05, Ethereum (ETH) went down by 0.7 per cent to $3,228.56, and Bitcoin (BTC) slumped by 0.6 per cent to $95,086.80.
Conversely, Litecoin (LTC) appreciated by 3.2 per cent to $74.48, Solana (SOL) rose by 0.4 per cent to $143.70, Cardano (ADA) jumped by 0.2 per cent to $0.3942, and Binance Coin (BNB) increased by 0.1 per cent to $935.88, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
By Adedapo Adesanya
Oil prices settled higher amid lingering worries about a possible US military strike against Iran, a decision that may still occur over the weekend.
Brent crude settled at $64.13 a barrel after going up by 37 cents or 0.58 per cent and the US West Texas Intermediate (WTI) crude finished at $59.44 a barrel after it gained 25 cents or 0.42 per cent.
The US Navy’s aircraft carrier USS Abraham Lincoln was expected to arrive in the Persian Gulf next week after operating in the South China Sea.
Market analysts noted that it doesn’t seem likely anything will happen soon. However, the weekends have become the perfect time for actions so as not offset the markets.
The market had risen after protests flared up in Iran and US President Donald Trump signalled the potential for military strikes, but lost over 4 per cent on Thursday as the American president said Iran’s crackdown on the protesters was easing, allaying concerns of possible military action that could disrupt oil supplies.
Iran produces approximately 3.2 million barrels per day, accounting for roughly 4 per cent of global crude production, so it was not a coincidence that markets rallied sharply through Tuesday and Wednesday as President Trump canceled meetings with Iranian officials and posted that “help is on its way” to Iranian protesters, raising fears of potential US military strikes that sent prices surging toward multi-month highs.
Weighing against those fears are potential supply increases from Venezuela.
The Trump administration is exploring plans to swap heavy Venezuelan crude for US medium sour barrels that can actually go straight into Strategic Petroleum Reserve (SPR) caverns, since not all all oil belongs in the reserve.
According to Reuters, the Department of Energy is considering moving Venezuelan heavy crude into commercial storage at the Louisiana Offshore Oil Port, while US producers deliver medium sour crude into the SPR in exchange.
Analysts expect higher supply this year, potentially creating a ceiling for the geopolitical risk premium on prices.
Some investors covered short positions ahead of the three-day Martin Luther King holiday weekend in the US.
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