CBN Sets New Standards For Sustainable Banking Solutions

CBN Sets New Standards For Sustainable Banking Solutions....KINDLY READ THE FULL STORY HERE▶

The Central Bank of Nigeria (CBN) has pledged to advance sustainable banking through the adoption of International Financial Reporting Standards (IFRS) to attract foreign investment and drive economic growth……. CONTINUE READING 

CBN Governor, Olayemi Cardoso, made the announcement at the Regulatory Roundtable on the Implementation of ISSB’s Sustainability Reporting Standards in Nigeria, held in Abuja on Thursday. This move supports the federal government’s target of reaching a Gross Domestic Product (GDP) of $1 trillion by 2031.

Cardoso highlighted the growing importance of sustainability reporting for stakeholders, noting that many companies are now focusing on sustainability goals and reducing their carbon footprint. “The world is progressing, and we must keep pace. Our entities need to align with global standards as the President aims for a $1 trillion GDP within the next six years,” he said.

Represented by Musa Jimoh, Deputy Director of Payments System Policy and Oversight, Cardoso emphasized the CBN’s collaboration with banks and other financial institutions to facilitate the transition to these standards. He recalled that in 2010, the Financial Reporting Council of Nigeria set a roadmap for IFRS adoption, which began on January 1, 2012. The transition from previous accounting standards marked a significant advancement in Nigeria’s financial reporting.

Cardoso noted that the CBN’s effective management of this transition has led to substantial growth in the Nigerian banking sector, both locally and internationally, with Nigerian banks now operating over 55 subsidiaries and multiple branches worldwide. He also pointed out that foreign investments and credit facilities have increased, reflecting growing confidence in Nigeria’s financial system.

The CBN is now focused on implementing the latest IFRS standards, including IFRS S1 and IFRS S2, to enhance transparency and financial integrity. The CBN’s commitment to sustainability is further reflected in the introduction of sustainable banking practices in 2020, which include managing environmental and social risks and improving financial inclusion. The Sustainability Banking Awards recognize banks that make significant strides in these areas.

Cardoso acknowledged the challenges of adopting new global standards, particularly those related to climate-sensitive financial disclosures, and stressed the need for capacity development among stakeholders for successful implementation.

Rabiu Olowo, Executive Secretary of the Financial Reporting Council, noted Nigeria’s pioneering role in adopting the International Sustainability Standards Board guidelines. He highlighted the FRC’s efforts to support businesses through workshops and training, preparing them for mandatory sustainability reporting by 2028.

The FRC has observed early successes with companies like Access Bank, Fidelity Bank, Seplat Energy, and MTN leading in sustainability reporting. Olowo called for further collaboration among regulators to promote a culture of sustainability and environmental stewardship, positioning Nigeria as a leader in sustainable business practices.

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