#10 The 2025 ESG Shift: 5 Trends Nigerian Companies Can’t Afford to Ignore

For years, Environmental, Social, and Governance (ESG) has been a growing conversation in global boardrooms. In Nigeria, that conversation has now become a strategic imperative. The era of ESG as a “nice-to-have” is over. As we look towards 2025, a perfect storm of regulatory mandates, investor demands, and societal expectations is fundamentally reshaping Nigeria’s business landscape.

Companies that adapt will unlock new capital, build resilience, and gain a powerful competitive edge. Those that don’t risk being left behind.

At Teasoo Consulting, we guide businesses through this complex transition. Here are the five critical ESG trends our team has identified that every Nigerian leader must watch in 2025.

1. The Reporting Revolution: Mandatory Disclosures Arrive

The days of voluntary, glossy sustainability reports are numbered. The Financial Reporting Council (FRC) of Nigeria has laid out a clear roadmap for adopting the IFRS Sustainability Disclosure Standards (S1 & S2). While mandatory reporting for all public interest entities begins in 2028, the voluntary adoption phase is already underway. Leading firms like MTN and Access Bank are already setting the pace.

• The Bottom Line: The runway is getting shorter. Waiting until 2027 is not a strategy.
• Your Action Plan: Begin building robust ESG data collection systems now. This means mapping your material issues, tracking key metrics like GHG emissions and labour practices, and aligning your reporting framework with global standards to prepare for the inevitable.

2. Climate Action Meets Corporate Strategy

Nigeria’s national climate commitments, including the 2060 net-zero pledge and the Climate Change Act (2021), are now translating into direct business pressures. Regulators are targeting emissions with new rules for methane reduction and the elimination of routine gas flaring. Simultaneously, the nation’s energy transition is accelerating, with government-backed initiatives like Solar Power Naija and World Bank programs creating a boom in renewable energy.

• The Bottom Line: Climate risk is now a core business risk, and the green transition is a significant commercial opportunity.
• Your Action Plan: Conduct a thorough climate risk assessment of your operations and supply chain. Energy-intensive industries must create clear roadmaps for emissions reduction. All businesses should explore integrating renewable energy solutions to cut costs and align with national policy.

3. Green Capital: The New Language of Investors

Access to capital is increasingly tied to your ESG credentials. Global and local investors are screening for strong ESG performance, making it a critical factor in their due diligence. Nigeria is leaning in, with a planned sovereign green bond and the Nigerian Exchange’s dedicated sustainability bond segment. If you want to attract investment, you need to speak the language of sustainable finance.

• The Bottom Line: A strong ESG profile is no longer just for reputation; it’s for your balance sheet.
• Your Action Plan: Align your projects with green finance criteria. Prepare comprehensive ESG disclosures for lenders and investors. Consider ESG ratings to demonstrate your commitment and potentially unlock cheaper capital.

4. The ‘S’ in ESG: A Focus on People and a Just Transition

Stakeholders—from customers and employees to local communities—are demanding greater social accountability. It’s not enough to be green; you must also be fair. Nigeria is developing a “Just Transition” framework to ensure the shift to a low-carbon economy protects workers and communities. This puts fair labour practices, workforce reskilling, and community investment in the spotlight.

• The Bottom Line: Your social license to operate is as important as your business license.
• Your Action Plan: Embed social impact into your strategy. Engage transparently with local communities, invest in upskilling your workforce for the green economy, and ensure your supply chain adheres to ethical labour standards. Disclosing your social metrics will build invaluable brand trust.

5. Governance as the Bedrock: From Compliance to Oversight

The ‘G’ in ESG is the glue that holds it all together. Strong governance is moving from a compliance checkbox to the central pillar of a resilient organisation. The Nigerian Code of Corporate Governance now requires boards to have formal stakeholder engagement policies and actively oversee ESG matters. This includes managing emerging risks like cybersecurity and data privacy.

• The Bottom Line: Effective ESG strategy starts in the boardroom.
• Your Action Plan: Strengthen board-level oversight of sustainability. Appoint directors with ESG expertise, integrate sustainability metrics into executive compensation, and ensure robust anti-corruption and ethics policies are enforced from the top down.

Navigating the Path Forward

The trends for 2025 are clear: ESG is now woven into the fabric of regulation, finance, and strategy in Nigeria. This transition presents immense challenges, but even greater opportunities for innovation, growth, and long-term value creation.

Is your organisation prepared to turn these trends into a competitive advantage?

At Teasoo Consulting, we provide holistic advisory and project implementation to help businesses move from awareness to action. We partner with you to build a resilient and sustainable future.