President Muhammadu Buhari yesterday said tackling wastage and mismanagement of public resources remained a crucial component of financial sustainability.
Buhari also put the estimated cost of Nigeria’s Sustainable Development Goals (SDGs) financing requirements at about $100 billion.
The president said the accounting profession has a sacred responsibility to ensuring prudence, transparency and accountability in the administration of public resources.
Speaking at the opening of the 52nd National Conference of the Institute of Chartered Accountants of Nigeria (ICAN), with the theme: “Nigeria: Adopting Sustainability for Economic Prosperity”, Buhari, noted that sustainability reporting is fast becoming a growing reporting area in modern business globally.
He said the National Development Plan (2021-2025 and associated strategies had been put in place to reflect emerging threats and opportunities and develop a clear path to reaching the nation’s goals and priorities.
Represented by the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, the president said the growing momentum towards increased organisational disclosure of environmental, social and governance information had made more companies see the need to report on their Environmental Social Governance (ESG) operations.
Buhari’s speech was, however, read by the Senior Special Adviser to President on Economy, Dr. Sarah Alade, who also stood in for the minister.
The president also said the federal government was firmly committed to the 2030 Agenda for sustainable development and SDGs.
He pointed out that governments and regulators have increased interest in sustainability reporting, given the demand for disclosure of ESG information from investors and the public.
He charged ICAN to embolden chartered accountants to lead the innovations around sustainability and sustainability reporting, adding that accountants are noted for their strong ethical foundations, robust qualifications framework, and extensive skills and experience in generating and assuring decision-useful information are best placed to deliver on the emerging need.
He said financial sustainability remained a vital component of his administration’s sustainability agenda.
Buhari added, “Nigeria is counting on your professional support to ensure economic sustainability becomes a national culture. The National Development Plan has advanced clear strategies to intensify the transition and drive toward financial sustainability.
“We must deepen the revenue base of the economy through broader and strategic diversification.
” The recent Environmental Social Governance (ESG) regulations by the Securities and Exchange Commission to catalyse corporate and sub-national bond issuance are also of note.”
Buhari, further noted that although, the total issuance size of both the federal, state and corporates are relatively small, given the global appetite and increasing awareness around sustainability, “we believe there will be more action”.
However, in his remarks, the President of ICAN, Mallam Tijjani Musa Isa, said the growing interest in ESG issues and the increasing desire to transit to net-zero businesses provided a strong basis for the conference.
He said investors were re-evaluating their resources channels because of the consequences of social and economic distortions on growth and development, adding that there has been a demand for companies to deliver values in more sustainable and responsible ways.
This, he said, had led to a significant shift in the direction of investors’ funds.
“For instance, the Global Sustainable Funds Flows noted that inflows into sustainable funds rose from $5 billion in 2018 to more than $50 billion in 2020 – and then to nearly $70 billion in 2021.
“To effectively participate in the competitive global space, there is the need for our economy to revisit our environmental, social, and governance priorities. Nigeria should consciously deploy resources in creating the regulatory and infrastructural environments that encourage the transition to net-zero business models by enterprises.
“This would avail the dual advantage of attracting more sustainable funds into the country and enhancing our social license – the perception by stakeholders that businesses and industries are acting in a way that is fair, appropriate, and deserving of trust.”
Isa, further noted that the Nigerian economy was not out of the woods yet, stressing that economic growth, post-COVID has decelerated, averaging 3.54 per cent due to persistently low oil production and rising insecurity.
He said even with the recent modest diversification of the nation’s income from the export of crude oil, export/import dynamics are still unsustainable.
The ICAN president added, “As long as we export primary products and import finished/processed goods, we will continue to be at the mercy of fluctuating external economic dynamics. Our Export/Import index has placed significant pressure on our demand for foreign exchange.
“Public debts, which were 20.5 per cent of GDP in 2021, are estimated to reach 40 per cent in 2024. Our continual funding of recurrent expenditure with long-term debts dooms us to continue repeating negative economic realities as no real development can proceed therefrom.
“We have been reluctant to eradicate the unsustainable practice of fuel subsidy. We maintain refineries that are not productive, and our nation is still largely classified as a fossil fuel economy.