In a landmark move, the Financial Reporting Council of Nigeria (FRCN) has officially launched a roadmap for the adoption of the Sustainability Financial Reporting Standards, positioning Nigeria as the first African nation to take such a bold step. The unveiling took place at the Nigerian Exchange Limited (NGX) headquarters in Lagos, marking a significant milestone in the country’s financial sector.
During the event, FRCN’s Chief Executive Officer, Mr. Rabiu Olowo, highlighted the importance of this achievement, noting that it represents the third phase of Nigeria’s journey toward fully integrating the new sustainability standards. Olowo emphasized that the roadmap is designed to systematically incorporate sustainability reporting and assurance into the country’s financial practices, with clear timelines for implementation.
“The significance of this roadmap is that Nigeria has distinguished itself as a leader in Africa, and indeed the global south, by being the first to embrace these sustainability standards,” Olowo stated. “This positions Nigeria to attract increased foreign direct investment, which is crucial for our economic growth. Moreover, the FRCN will maintain stringent oversight to prevent greenwashing and ensure the highest standards of sustainability reporting.”
The IFRS Sustainability Standards, developed to enhance transparency and dialogue between investors and companies, aim to provide investors with globally comparable sustainability-related disclosures that are essential for informed decision-making. The roadmap was launched at a session featuring Emmanuel Faber, Chairman of the International Sustainability Standards Board (ISSB) and the IFRS Foundation, who praised the collaborative efforts that led to this historic adoption in Nigeria.
Faber underscored the necessity of integrating sustainability into financial reporting, particularly in addressing the risks associated with climate change and economic transitions. He argued that traditional accounting practices fall short by not accounting for long-term assets like human capital and national resources, which are critical for assessing a nation’s true economic resilience.
“If our financial reporting systems accounted for these broader factors, Nigeria’s currency would not be under the pressure it currently faces. Investors and financial institutions would recognize the immense value in Nigeria’s human and natural capital,” Faber noted. He further assured that the ISSB would continue to support Nigeria in implementing the sustainability standards, thereby enhancing the nation’s credibility and transparency in global supply chains.
NGX RegCo’s CEO, Mr. Femi Shobanjo, also expressed his appreciation for the ISSB’s role under Faber’s leadership, acknowledging the hard work that has gone into making the adoption of the Sustainability Financial Reporting Standard a reality in Nigeria.
This initiative is expected to set a new benchmark for financial reporting in Nigeria and beyond, paving the way for more robust and sustainable economic growth in the country.
