Nigeria: ISSB-Aligned Disclosures Will Cut Capital Costs, Boost Global Investor Confidence – SEC’s Agama

The Securities and Exchange Commission (SEC) is moving to align Nigeria’s capital markets with International Sustainability Standards Board (ISSB) disclosure frameworks, a step expected to enhance transparency, lower the cost of capital, and attract long-term global investment.

Speaking at a panel session on the adoption of IFRS S1 and S2 standards, SEC Director-General, Dr. Emomotimi Agama, said the Commission is committed to embedding sustainability reporting in line with the ISSB’s global baseline under the International Financial Reporting Standards (IFRS) Foundation.

According to him, adopting these standards will boost investor confidence, reduce information risks, and make Nigerian securities more attractive to global institutional investors and development finance institutions (DFIs).

Agama noted that Nigeria has already developed an implementation roadmap through the ISSB Standards Adoption Readiness Work Group (ARWG). The plan starts with voluntary adoption by early movers and large public interest entities (PIEs), followed by phased mandatory adoption — beginning in 2027 for significant PIEs, 2028 for other PIEs, and 2030 for SMEs.

The disclosure framework is designed to provide investors with clear, comparable, and decision-useful information on how companies manage risks, build resilience, and pursue transition strategies. Agama stressed that this would not only reduce borrowing costs but also expand access to global pools of sustainable finance.

To ease adoption, the SEC is collaborating with the Financial Reporting Council of Nigeria (FRCN) on phased assurance requirements, and with the Nigerian Exchange Limited (NGX) to roll out taxonomy-enabled digital reporting systems that support machine-readable disclosures. Efforts are also underway through the Capital Market Master Plan Implementation Council (CAMMIC) to harmonise ESG data requirements and reduce the reporting burden on issuers.

Agama explained that the SEC will initially apply a review-based supervisory model and a “comply or explain” regime, before moving to full enforcement once market capacity strengthens.

Looking ahead, he said full adoption of ISSB-aligned standards will not only raise the market’s credibility but also spur innovation in green bonds, sustainability-linked bonds, and transition sukuk—broadening investment options and improving Nigeria’s eligibility for global indices.

“Aligning with ISSB standards is central to our vision of building a transparent, resilient, and globally competitive market,” Agama stated. “It will open Nigerian issuers to deeper capital pools, strengthen investor trust, and position our market as a credible destination for responsible investment.”