A coalition of civil society organizations has indicted Nigeria's banking sector for weak commitment to sustainability and responsible finance, following the release of a policy assessment report that highlights significant gaps in Environmental, Social, and Governance (ESG) compliance. The report, unveiled yesterday in Abuja, found that leading banks in the country have yet to integrate sustainability into their core financing decisions, despite growing global standards and Nigeria's vulnerability to climate risks.
The study was conducted by the Fair Finance Nigeria (FFNG) Coalition, comprising BudgIT, Oxfam, Policy Alert, Civil Society Legislative Advocacy Centre (CISLAC), Connected Development (CODE), and Sustainable Transformation and Empowerment Programme (STEPS). Presenting the findings, Executive Director of CISLAC, Auwal Ibrahim Musa Rafsanjani, said the assessment revealed deep systemic weaknesses in how banks address environmental and social responsibilities.
Key Findings from the Report
The report, titled “How Four Banks in Nigeria Are Responding to Global ESG Compliance Standards,” evaluated Access Bank, Standard Chartered Bank, United Bank for Africa and Zenith Bank against more than 400 international ESG indicators. According to the findings, the banks recorded an average score of 1.7 out of 10, reflecting what CISLAC described as a disconnect between regulatory compliance and actual commitment to sustainability.
On tax transparency, all four banks scored zero, with the report noting a lack of disclosure on country-by-country reporting and exposure to tax havens, an issue that undermines global efforts to tackle illicit financial flows. Climate action also performed poorly, with an average score of 0.9, as banks were found to continue financing high-emission sectors without credible transition strategies.
Human Rights and Environmental Concerns
The report further flagged weak commitments to human rights, biodiversity protection and host community welfare, suggesting that financial institutions often prioritise profit over environmental and social considerations. While some improvements were observed in internal policies such as labour standards, gender equality and anti-corruption measures, CISLAC said these gains were overshadowed by major deficiencies in how banks fund external projects, where their impact is most significant.
Call for Regulatory Reform
Rafsanjani noted that Nigeria's Sustainability Banking Principles, introduced in 2012, have become outdated and insufficient to drive meaningful accountability in the sector. He called on the Central Bank of Nigeria (CBN), the Chartered Institute of Bankers of Nigeria, the Bank Directors Association of Nigeria, and relevant National Assembly committees to convene a multi-stakeholder dialogue to review and strengthen the country's ESG framework.
