In the investment industry and beyond, there is an uncertainty about integrating environmental, social and governance (ESG) criteria in Africa.
• The difficulty of doing this and the need to do it are both assumed to be unequally matched and huge in Africa, where so many people still live in poverty. In Nigeria, 70% of the entire population live below poverty level.
• In a 2011 brief, the International Finance Corporation (IFC) reported on a “growing awareness” that sustainable investment in Sub-Saharan Africa “can play an essential part in tackling the social and economic challenges in the region—and that the resulting economic growth will benefit investors over the long term.
• At the end of 2010, ESG-profiled funds including self-reported integration of ESG factors into fund investment policy in South Africa, Kenya, and Nigeria was estimated at $125 billion in assets under management (AUM).
• Investors into Africa are more than before, conscious about investing in companies (public and private) that are reporting quality ESG information.
• Different investors have different informational needs, but there is a growing level of consistency in incorporating material ESG factors into investment decisions.
• Therefore, a Sustainability Disclosure Guideline addresses this need and opportunity.
A wide range of customers, investors and other stakeholders are increasingly demanding more disclosure of information and data from companies on how they are addressing sustainability issues, including ESG factors and other non-financial risks and opportunities.
For certain entities in the investment community, a key driver for more ESG information is to enable assessments of how ESG factors may impact business fundamentals and a company’s long-term prospects.
This is due in large part to shifts in the way business is conducted, how businesses create value and the context in which they operate.
As the intersection point for various stakeholders (issuers, investors, regulators, operators), the Nigerian Stock Exchange is uniquely positioned to promote a more transparent and efficient capital market that generate long-term value for the Nigerian economy.
At the NSE, our Corporate Social Responsibility (CSR) philosophy is aimed at delivering a sustainable organisation through responsible financial and investment services, sustainable business practices, engaged and talented people, community contributions and environmental stewardship.
The Exchange’s CSR/Sustainability Strategy is built on priorities set across the four cornerstones of