The Federal Government of Nigeria has decided to collaborate with the Nigerian Exchange Limited (NGX) to set up a framework to improve the climate data availability for the investment and finance community.
The Federal Minister of State for Environment of Nigeria, Sharon Ikeazor announced the decision of the government at the digital closing gong ceremony to mark the end of the 2021 stock trading year, stating that the framework will aid issuers to navigate climate disclosure. The minister said NGX has played a significant role in Nigeria’s commitment to mitigating the serious and long-term threat of climate change.
The Minister said, ‘‘With the step taken immediately after COP26, Nigeria has further demonstrated its commitment towards the Paris Agreement on Climate Change. As part of measures to comply with the National Determined Contributions (NDC) in emissions reduction to climate change in Nigeria, the federal government launched the Nigeria Deep Decarbonisation Project.”
Nigeria has shown fine commitment to the goals of the Paris Agreement on Climate Change with the country’s revision of the NDCs pre-COP26 and President Buhari’s recent emphasis for mainstreaming of climate changes in the country and the establishment of the Council on Climate Change.
Ikeazor also added that investors are increasingly working together in response to climate change with the government to continue engaging NGX on climate disclosure and data.
The collaboration between the Federal Ministry of Environment and Nigerian Exchange Limited will help build the framework for navigating climate disclosure, associating engagement with their shareholders, and improving the climate data available to the investors and finance community.
Temi Popoola, the CEO of NGX Limited, said NGX is committed to promoting sustainable finance because it recognizes the urgency to combat climate change and its impact as incorporated in the Paris Agreement on Climate Change and Goal 13 of SDGs.
“We are committed to fostering the growth of sustainable financial products which integrate the financial risks and opportunities associated with climate change and other environmental challenges. NGX has shown a strong commitment to sustainable finance over the years. In 2016, NGX collaborated with the Ministry of Environment and the Debt Management office to deepen the green bond market,” said Popoola.
Popoala also noted that the efforts of NGX led to the issuance of the $25.8 million 13.48% 5-year green bond in 2017 to fund renewable energy projects. The second tranche issued in 2019 amounting to $36.1 million 14.5% 7-year green bond was oversubscribed.
NGX hosted a conference on sovereign green bonds in 2017 which provided for strategic engagement between the government and financial market players on investment in sustainable development projects.