Environmental, Social, and Governance (ESG) is the lens through which organizations assess their sustainability and ethical impact. It spans environmental stewardship, social responsibility, and corporate governance, providing a framework to guide decisions, strengthen accountability, and drive long-term performance.
At ESG Elevate Corner, we track ESG developments in Nigeria and around the world, one report at a time, delivering insights, updates, and analysis to help readers stay informed and make responsible, forward-looking decisions.
As 2025 draws to a close, the global ESG and sustainability agenda is undergoing a decisive recalibration. What began as an aggressive regulatory sprint has evolved into a pragmatic marathon, characterised by eased reporting burdens, renewed focus on industrial competitiveness, and an increasing surge of private capital into clean energy and climate innovation. Regulation is no longer the sole driver of decarbonization; capital allocation, technology, and economic realism are progressively shaping outcomes.
Nigeria’s ESG framework advanced significantly in late 2025, marking a decisive policy shift:
Legal and Regulatory Transformation: The updated Investments and Securities Act (ISA 2025) elevated sustainability disclosure from best practice to a legal requirement, granting the SEC enforcement authority under Section 355(1)(r)(v).
Financial Reporting Council Roadmap: The FRC finalized timelines for adopting IFRS S1 and S2, with mandatory reporting for public sector entities and private firms commencing January 1, 2028.
Oil & Gas Decarbonization Push: The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) made its Upstream Petroleum Decarbonization Template (UPDT) compulsory. Operators must now demonstrate active strategies to reduce flaring, cut methane emissions, and manage carbon to secure licenses and approvals.
The Reality Check: Nigeria’s ESG Performance: The 2025 Independent Project Monitoring Company (IPMC) ESG Ratings Report revealed both progress and persistent gaps. Zenith Bank, Stanbic IBTC, and Access Holdings emerged as ESG leaders. However, only 5% of rated companies achieved “robust” ESG status.
Most notably, Scope 3 emissions disclosure remains a critical weakness, with only 12% of financial institutions currently reporting, which highlights a significant transparency gap.
The European Union, long regarded as a global standard-setter for climate policy, spent December signalling a shift toward economic realism.
While Europe simplifies ESG compliance/requirements, North America is seeing a fractured approach driven by political shifts.
Federal Rollbacks vs. State-Level Activism: As the Trump administration rolls back federal Environmental Protection Agency (EPA) and the Securities and Exchange Commission (SEC) climate reporting programs, states like New York have stepped into the vacuum. New York recently finalized regulations requiring mandatory greenhouse gas reporting for large emitters starting in 2027.
The ESG Political Backlash: Financial giants continue to face political headwinds. The New York City Comptroller called for the removal of a $42 billion mandate from BlackRock, while a major Dutch pension fund withdrew $5.9 billion, both citing dissatisfaction with how ESG execution, rather than ESG principles themselves.
A 2025 LinkedIn study highlights a growing “Green Skills Gap,” with demand for green talents grew by 7.7%, nearly double the 4.3% growth in the supply of skilled talent.
However, not all corporations are staying the course. AT&T made waves by committing to scale back its DEI (Diversity, Equity, and Inclusion) programs and goals, while Neste delayed its climate targets, labelling the required investments as “currently not realistic” under current economic conditions. The message: ambition must now contend with balance sheets.
Despite the regulatory noise, the flow of capital into clean energy remains relentless, spearheaded by the “Big Tech” and global infrastructure players.
Deal Lead | Partner/Target | Scope |
Microsoft | Iberdrola/InPlanet | Clean energy, AI deployment, and carbon removal |
TotalEnergies/Fervo | 21-year deal for geothermal power for data centres in Malaysia | |
Meta | NextEra | 2.5 GW U.S. clean energy capacity |
Brookfield Asset Mgt./CVC Capital Partners | Alba Renewables | Acquisition of European and SE Asian Green Platforms |
These investments signal a structural shift: decarbonization is now deeply embedded in energy security, AI infrastructure, and long-term cost efficiency.
December saw a significant focus on “Hard-to-Abate” sectors. Radiant raised $300 million to advance small nuclear reactors, and Holcim, in partnership with 44.01, launched a pioneering pilot project in Fujairah, UAE, to permanently store CO2 from cement production by mineralizing it into underground rock formations. The project aims to capture 5 tonnes of daily emissions, directly addressing emissions from cement manufacturing, which accounts for roughly 8% of global CO2, using 44.01’s technology to convert it into a stable mineral form.
As 2026 approaches, the ESG conversation is shifting decisively. The “S” and “G” are under sharper scrutiny, while the “E” is transitioning from a compliance burden to a core industrial and investment strategy. The great decarbonization shift is no longer about who reports the most, but who executes best in a capital-constrained, geopolitically complex world.
