If you’ve seen “ESG” in a newsletter, bank circular, or an FRC notice and skipped past it because it sounded like something only for multinationals... well, it's not.
ESG is becoming increasingly relevant to how businesses operate, manage risk, and meet evolving reporting expectations. And with Nigeria’s sustainability reporting requirements taking shape, understanding what ESG means and what it requires of your business is becoming more important.
Here’s what you need to know about ESG reporting in Nigeria.
What ESG Actually Is
ESG stands for Environmental, Social, and Governance — three categories regulators, banks, and investors now use to judge how a business is run, alongside its financial statements.
Environmental: how much you emit, consume, and waste (energy use, generator diesel, water, and waste disposal).
Social: How you treat people, including employees, suppliers, and the communities in which you operate.
Governance: How decisions are made, who is accountable, and whether appropriate oversight and controls are in place.
None of this is entirely new to well-run businesses. What’s new is that it now has to be measured and reported, not just practiced quietly.
Why This Landed on Your Desk Now
In February 2026, Nigeria’s Financial Reporting Council (FRC) finalized rules that make ESG reporting mandatory for PIEs, with a 2028 compliance deadline and a 2030 deadline for smaller entities and government bodies. Before anyone reports anything, businesses will have to pass a formal readiness check confirming they actually have the data to back up what they report.
2028 feels far away, but the data you’ll report on has to be collected starting now, going back several years. A business that starts building this data in 2027 will already be behind.
What Every Business Needs to Get Right First
You don’t need a 40-page ESG strategy document tomorrow. You need two processes in place, in this order:
Know your carbon footprint. Specifically, fuel used in generators and vehicles, electricity use, water consumption, and waste management. You may also need to assess emissions associated with suppliers and logistics. Most Nigerian businesses have never structured this data as we've seen it’s usually the single biggest gap in carbon footprint assessment.
Put real governance behind it. Someone at board or senior management level needs to oversee the process, with clearly assigned responsibilities, reliable supporting evidence, and appropriate review controls. A mission statement is just not enough.
Everything else from targets, sustainability reports and investor disclosures, is built on top of those two things. Skip them, and any ESG report you produce later will be a document with nothing underneath it.
What Happens If You Ignore It
Banks and investors are increasingly screening for ESG data before extending credit. This is already happening, not a future risk.
The FRC’s framework does not allow companies to self-certify their ESG data. Assurance is phased in, starting with limited assurance and moving to reasonable assurance over the years that follow.
Waiting until the deadline year means trying to reconstruct years of missing data under time pressure. That's the expensive way to go about this.
Where to Start
Talk to us. Preparing for ESG reporting starts with understanding where your business stands today and what needs to change.
At Baker Tilly Nigeria, we help businesses build an accurate carbon footprint baseline and a governance structure that will hold up under the FRC’s readiness test. A typical engagement starts with a 4 week diagnostic, with a baseline carbon footprint report and governance gap assessment as the first deliverable.
Don’t wait until the deadline to start preparing.
Book a 30-minute ESG readiness assessment session with Baker Tilly Nigeria here.