The Chairman of the Nigeria Integrated Reporting Committee, Dr Innocent Okwuosa, has urged financial institutions and other stakeholders to embrace sustainability reporting for its ability to unlock capital.

Okwuosa said that on Thursday in Lagos, during a chat with journalists on the forthcoming capacity-building workshop for financial institutions organised in conjunction with the Financial Reporting Council.

The immediate past president of the Institute of Chartered Accountants of Nigeria said that with the country being the first African country to announce the adoption of the International Sustainability Standards Board standards on sustainability, it was imperative to get stakeholders on the same page.

The FRC, ISSB and NGX Regulation Limited have now launched the first two IFRS Sustainability Disclosure Standards, IFRS S1 and IFRS S2.

Okwusa said, “Globally, sustainability information is now looked at as financial information that enables investors to make informed investment decisions. The Nigeria Integrated Reporting Committee before now has been at the forefront of advocating for the integration of sustainability and financial reporting in corporate annual reports.

“Sustainability reporting will help unlock capital. When it comes to climate change, there are climate risks and companies that do not show that they are mindful of these are likely going to lose investors.

“If you have dealings with Europe, they expect that you have an awareness of climate risks and that you’re doing something about them. If you don’t disclose, investors will feel like you have high risks within your business model and once they have that kind of feeling, they are not going to extend funds to you. That is why we say adoption of sustainability disclosure will help unlock capital.”

For the workshop, the NIRC boss explained that the organisation was working with the FRC to ensure that the required skills were built within the country.

“Arrangements have been perfected to start capacity building among financial institutions and the way it works this time around, NIRC and FRC are not collecting money from anybody,” he added.

Meanwhile, the FRC stated that the adoption of ISSB sustainability standards aimed to empower investors to make better investment decisions and encourage corporations to integrate sustainability into their corporate reporting.

It will be recalled that following the announcement of the adoption of ISSBs Sustainability Standards, FRC set up an adoption Readiness Working Group to come up with a roadmap for Nigeria’s adoption of IFRS S1 and S2.

To actualise the adoption of IFRS S1 and S2, the FRC signed a Memorandum of Understanding with the NIRC as its technical partner.