Enabling climate action and accountability for companies in Nigeria
In the wake of increasingly evident climate impacts especially in the Global South, which is less prepared to manage these huge distortions to societal dynamics due to their resource-poor status, there is increased focus on all stakeholders to commit to climate action. This is especially important for high-emitting industries such as the energy sector, transportation, industrial manufacturing, and construction, amongst others which emit high amounts of greenhouse gases into the atmospheres from their different modes of operations. In line with the tenets of climate justice that posit that those who contribute most to the problem of climate change put in significant effort to address the problem, the onus, therefore, lies on these high-emitting industries to firmly commit to climate action, that is critical to ensuring resilience in the Global South.
Climate resilience is specifically vital for local communities in the Global South that are currently at the mercy of climate change impacts as there is a dearth in their capacities to handle extreme weather events that befall them – for instance, farmers in India have had their farmlands and crops ruined by snowstorms, people of Mozambique facing increasing occurrence of cyclones, drought occurrence in Madagascar amongst others have had their environment disrupted in terrible ways with little or no resources to ensure quick recovery.
The story is not any different in the Sahel region and in the lowlands of the Delta. On this note, it is non-negotiable for all emitting industries (high or low) to re-design their corporate practices largely based on climate action that would support the climate resilience of local communities. At the forefront of driving the commitment of organizations to climate action in Nigeria is the Nigeria Exchange (NGX) Group. NGX has, in no doubt, immersed itself in the process of ensuring that the nation is able to reduce its current levels of emissions by 50% in 2050 as outlined in the Long-Term Vision 2050 of the Nigerian Economy that was presented in 2021 by Federal Ministry of Environment.
In order to drive this, NGX has continuously pushed for sustainability reporting amongst all companies listed in Nigeria’s Exchange Limited while enabling them to incorporate Environmental, Social, and Governance (ESG) principles into their business operations. This is critical to helping these companies assess, disclose and communicate their efforts, progress and impacts on the environment. With this support, these companies are able to set clear goals, implement effective strategies and show their commitment to climate action. One of such impressive attempts of the NGX at supporting sustainability reporting in the country is the development of a Sustainability Disclosure Guideline in 2019 by Nigerian Exchange Regulation Limited. This disclosure guideline has therefore provided impetus to the recent directive of the Federal Government for all companies to commence sustainability reporting by January 2024 – a step in the right direction to facilitate green investment.
Furthermore, NGX is driving the process of incorporating climate disclosure into Nigeria’s capital market through the development of NGX Climate Disclosure Guideline. This guideline is posited as a reliable method through which stock exchanges can incorporate the tenets of the Task Force for Climate Related Financial Disclosure (TCFD) into their reporting. While there is no clarity yet if the guidelines would either focus on financial climate disclosures or non-financial climate disclosure or both, there is the certainty that listed companies would provide vital information which stakeholders can engage with to drive accountability in climate action in Nigeria.
As the NGX has risen to play a vital in enabling climate action amongst Nigerian companies, which is vital to ensuring the country’s Nationally Determined Contributions (NDCs) are achieved, other critical stakeholders must move in the direction of climate accountability. And this is where organizations like OrderPaper Nigeria, through its RemTrack initiative, have become vital levers to support the climate resilience of local communities in the
country.