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SEC Urges Sustained Green Investments in Capital Market

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By Tony Obiechina, Abuja

The Securities and Exchange Commission has reiterated the need to facilitate the issuance of green and sustainable instruments in the Nigerian capital market, saying such issuances will go a long way to assist in financing solar energy and other environmentally friendly infrastructure.


Director General of the SEC, Mr.
Lamido Yuguda stated this during the Environmental, Social and Governance Roundtable with the theme: Unlocking Value Through ESG Investing organized by the CFA Society Nigeria, Thursday.

Yuguda said that beyond the Federal Government and corporate issuers, sub-nationals can also 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.

He said, “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.
“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”.
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 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.
Yuguda said that as Securities regulators, whose core mandate is to ensure investor protection, by maintaining fair, efficient and transparent markets and reducing systemic risks, the Commission 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, Ibikun Oyedeji said the Webinar was organized 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 government factors in business decisions and product development.
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, labor 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”.
Oyedeji said the CFA institute through the principle of responsible investing has created 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.

Economy

Value Addition is new Standard in Mining Operations – Alake

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The Minister of Solid Minerals Development, Dr Dele Alake has declared value addition as the new indispensable standard for mining operations in the country.

Alake made the declaration in a statement issued by his Special Assistant on Media, Mr Segun Tomori, on Tuesday in Abuja.

The minister had earlier said that the federal government had resolved to ensure compliance to value addition before permitting investors to operate.

He said that his seven-point agenda for the ministry had placed the mining sector on the global front burner since assuming office, which had generated renewed interest from the international community in Nigeria`s mineral resources.

According to the statement, the minister lauded a mining company, African Natural Resources and Mines Ltd.

(ANRML), during an inspection tour in Kaduna State, for its 600 million dollar facility dedicated to the mining and processing of magnetite iron-ore.

He described the move as in line with the government`s resolve for value addition, which is especially apt given President Bola Tinubu`s quest to develop the solid minerals, to boost Nigeria`s economic profile and to meet the global upsurge in energy transition.

“The company aligns with our vision of value addition and beneficiation through its processing of iron-ore, and I urge other mining companies to take a cue from them, “ he said.

He reiterated the government`s commitment to abstain from granting mining licenses to companies that lack the necessary plans for value addition.

The minister acknowledged that resilience, courage and laying a solid foundation were critical in contributing to the company success.

He added that such factors also serve as guidelines for President Tinubu`s administration in its efforts for economic transformation.

“ We have set our minds in this administration and invariably in Nigeria to achieve success, that is why Mr President is restructuring the economy.

“When this company (ANRML) started seven years ago, we saw one of the foundations through the video documentary, the amount of concrete that went in to erect a foundation, just to carry a giant edifice.

“That is what we are going through. When we get through the gestation period, the results will manifest, and it will herald prosperity, “he said.

The minister had stated that no license would be granted to companies wishing to enter the mineral sector without presenting a plan for value addition, such as processing and refining which has multiplier effect on the economy. (NAN)

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Economy

Life Insurance Records 95% Net Claims in Q4 2023-NAICOM

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The National Insurance Commission (NAICOM) says Life insurance business recorded about 95 per cent net claims of the total claims in the fourth quarter of 2023.

A report by NAICOM in Abuja on Tuesday hinted that the record was due to the direct reflection of the ongoing regulatory measures by the Commission regarding claims settlements.

NAICOM said the insurance market average stood at about 71.

4 per cent of the N536.
5 billion gross claims reported at the close of the fourth quarter.

The Commission said the market also recorded retention of about 87.7 per cent for the life business, 54 per cent for non-life while the aggregate market average retention stood at 66.

7 per cent for the period.

It showed that the insurance industry sustained its progressive trend of positive market performance at the close of 2023 fourth quarter.

According to NAICOM, the insurance market recorded a milestone growth to close at N1.003 trillion, representing about 27 per cent growth compared to the N790 billion recorded in 2022.

”Major growth drivers in the non-life segment of the market were oil and gas and fire Insurances contributing 27.3 per cent and 24.1 per cent respectively.

”In a direct reflection to the “no-premium no-cover” policy of the Commission, the outstanding premium continues to decline.

”The premium posted 1.6 per cent as outstanding of all the premiums generated in the market during the period.

”Statistics also shows that the market recorded total assets of about N2.67trillion and capitalisation of N851billion in 2023,” NAICOM said. (NAN)

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Economy

No Mining License without Mineral Value Addition Plans-Alake Warns

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The Minister of Solid Minerals Development, Dr Dele Alake has warned that no mining license would be issued to prospective investors without requisite plans for value addition on minerals.

Alake gave the warning in a statement  by his Special Assistant on Media, Segun Tomori on Tuesday.

He said the Federal Government had resolved to ensure compliance before permitting investors to operate.

He said that his Seven -Point Agenda for the ministry had placed the mining sector on global front burner since assuming office, which had generated renewed interest from the international community in Nigeria’s mineral resources.

He said the support of the executive and the legislature had enabled the ministry to showcase the solid minerals sector globally, resulting in his election as the Chairman of the Africa Minerals Strategy Group (AMSG) at the Future Minerals Forum in Riyadh, Saudi Arabia.

According to him, with the pact that led to the formation of the AMSG, there is now unity of purpose on the African continent regarding the issue of local value addition.

“We are no longer going to allow anybody or license any company that wants to go into the mineral sector without giving us a plan for local value addition,  like processing, refining and this has a multiplier effect on the economy.

“It instantly generates employment rather than a few people carting away lithium, gold, and the likes to other countries to sell.

“These minerals must now be processed in Nigeria, creating more value and beneficiation for local communities where they are sourced, ” he said.

Reports says that the minister had earlier received members of the House Committee on Solid Minerals who were on oversight visit to his office.

The minister commended the lawmakers for their support in repositioning the mining sector, stressing that boosting the economic profile of Nigeria required joint task by both the executive and legislature.

He acknowledged the significant contribution of sub-nationals to mining development, emphasising that state chairmen of  Mineral Resources and Environmental Management Committee (MIREMCO) and five committee members were nominated by state governments. (NAN)

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