June 25, 2024
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By Habibat Aliu
Experts have urged listed firms to implement sustainable  Environmental, Social, and Governance (ESG) policies to attract robust investment opportunities and grow their businesses.
According to the experts who spoke at a webinar organized by the Chartered Institute of Stockbrokers (CIS) in partnership with the Chartered Institute for Securities & Investment (CISI) aside from offsetting the negative effects of environmental challenges, sustainability has become a major tool deployed by portfolio, asset managers and other investment advisers to recommend profitable companies for their clients.
Therefore, they suggested that quoted companies should embed sustainability in their business to position for increased investment demand and maximise the benefits of sustainability.
Chairman, of Bond Forum and Capital Markets Pathway Qualifications Assessment Board, Chartered Institute for Securities & Investment (CISI) in the United Kingdom, Neil Brown said there is a need for companies to entrench sustainability in their businesses to promote good governance and community relations.
Delivering a paper titled “Sustainability in Nigeria’s economy, Capital Markets and Investment Products ‘,  Brown a Chartered Fellow of CISI,  said companies should also collaborate with stakeholders to raise awareness, build capacity and promote action on sustainability.
He urged companies to identify new opportunities whilst embedding sustainability considerations into their business to avoid and minimize any negative impacts.
“Companies should create appropriate governance policies and audits to promote community relations. They should also collaborate with stakeholders to raise awareness, build capacity, manage risks, develop solutions to promote finance of priority sectors and report the value of investments made and support received. ”
He said regulators expected companies to be transparent on their sustainability credentials as real actions can be under-reported through greenwashing tactics and their variants.
Brown noted that physical and transition risks would drive changing valuations for sectors and stocks while urging investment advisers to ascertain what drives the appetite of their clients in any investment opportunity.
“Some investors may be driven by part or whole of sustainability. Investment advisers must look for a measure that matches their clients’ objectives.

   “They should also beware of misleading scorecards. There could be strong ESG scores because of bad impacts and weak ESG scores despite good impacts.”, he said.
Chartered MCSI, CISI Assistant Director, Global Business Development, Helena Wilson said sustainability and the role that the financial services profession has to play in the route to net zero is now a crucial topic for investors and businesses globally.
She added that opportunities to enhance learning in the ESG area are becoming very essential.
Earlier,  the Head, Education, and Training, at CIS, Chukwudi Nga, explained that the webinar was one in the series of Mandatory Continuing Programme Development (MCPD), designed to enhance the professionalism of both members of CIS and CISI this year to enhance.
“Companies in Nigeria are aware of the essence of compliance with ESG. There are laws on sustainability in the Nigerian Constitution. The webinar was organised as part of the Mandatory Continuing Programme Development for securities and investment professionals,” he said.

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