Nigeria: Adoption of Nigerian Sustainable Banking Principles set to improve banks' transparency
Nigerian banks' adoption of the Nigerian Sustainable Banking Principles (NSBP) should improve transparency and accountability in the banking industry, according to a finance analyst."I feel the Central Bank had to come up with some comprehensive reporting package such as this for the industry, considering the past crisis (...) the banks still have work to do [to recover from the crisis - Editor's note], such as growing their loan books, hence the need for a close watch by the regulatory body, which will go a long way to aid transparency in the
Ayodeji Ebo, Analyst at Afrinvest West Africa Limited, told Premium Times.
In September 2012, the Central Bank of Nigeria (CBN)
issued a circular directing banks, discount houses and development finance institutions to implement the Nigeria Sustainable Banking Principles, which are based on leading international sustainable finance standards and established industry best practice.
The NSBP consists of several principles, such as managing environmental and social risk in business decisions, managing the bank's own environment and social footprint, safeguarding human rights, meeting the imperatives for good governance, transparency and accountability.
It also includes promoting women's economic empowerment, financial inclusion of communities and groups with limited access to the formal financial sector, supporting capacity building and promoting collaborative partnerships.
The CBN has given banks operating in the country until September 2013 to commence implementation of these principles.