SEC urges embrace of sustainable finance, eyes $2.6trn market
By Opeyemi Abdulsalam
The Director General of the Securities and Exchange Commission (SEC), Dr. Emomotimi Agama, has called on investors and market intermediaries to embrace sustainable finance, a move that could unlock a potential $2.6 trillion market.
Dr. Agama made the call at the 2024 Business Luncheon of the Association of Corporate Trustee (ACT) in Lagos, themed “Sustainable Finance: The Role of Corporate Trustees.”
Represented by the Director, Market Development of SEC, Tunde Kamali, the DG emphasised the importance of sustainable finance principles in growing the market.
The SEC boss noted that the principles of sustainable finance offer a new vista for market intermediaries, including trustees, to take their businesses and client relationships to a higher level.
He urged businesses to move towards more sustainable and climate-friendly solutions, citing the daunting challenges facing the planet, including climate change, resource scarcity, social inequality, and economic instability.
Dr. Agama emphasised the critical role of corporate trustees in facilitating sustainable financing, acting as intermediaries between investors and issuers, and overseeing assets while ensuring compliance with legal and fiduciary obligations.
He encouraged trustees to align investors’ interests with sustainable objectives by incorporating Environmental, Social, and Governance (ESG) criteria into investment strategies, guiding capital towards projects and initiatives that promote sustainability.
According to Dr. Agama, the demand for sustainable investing is not yet fully met by investment advisors, presenting an opportunity for financial intermediaries to tap into this growing market.
He stressed the collective responsibility of addressing the demands of the sustainability market, positioning ourselves ahead of the green supply curve while adhering to global standards and frameworks.
The SEC DG assured stakeholders of the commission’s commitment to championing sustainable financing, urging them to move beyond traditional roles, especially in sustainable finance.
He pointed out that the potential market size for sustainable finance is staggering, with opportunities for wealth creation alongside environmental and social impact.
The event also featured speeches from the Director-General, Debt Management Office (DMO), Ms. Patience Oniha, and the President of ACT, Omolola Iyinolakan, who emphasised the importance of sustainability and the role of trustees in protecting investors’ interests.
The push for sustainable finance comes as the world grapples with the challenges of climate change, environmental degradation, and social inequality.
The SEC’s call is seen as a step in the right direction, as Nigeria seeks to align its financial sector with global best practices in sustainable finance.
In a related development, a 2023 report by Deloitte highlighted the growing demand for sustainable investing among investors, with many seeking more support from their advisors.
The report noted that investment advisors are not fully meeting this demand, presenting an opportunity for financial intermediaries to tap into this growing market.
The SEC’s commitment to sustainable finance is expected to have a positive impact on the Nigerian financial sector, as stakeholders embrace the opportunities and challenges of this growing market.
