Nigeria: Telecom Sustainability Index Proposed for ESG Framework

• A National Telecom Sustainability Index has been proposed in Nigeria to measure the environmental, social, and governance (ESG) performance of telecom operators.
• Unveiled by the Telecoms and Technology Sustainability Working Group (TTSWG) in Abuja, the index aims to align local practices with international sustainability reporting.
• The framework is structured around five key pillars: Environment and Energy; Digital Inclusion and Affordability; Digital Integrity, Privacy and Consumer Trust; Infrastructure Resilience and Governance; and Supply Chain and Local Value Creation.
• It seeks to address critical industry challenges such as rising energy costs, e-waste, and inadequate digital inclusion, while also enhancing investor confidence.
• Currently a draft, the proposed index is open for stakeholder feedback to refine its implementation strategy.

The proposed framework is designed to bridge Nigeria’s unique telecommunications environment with internationally recognized sustainability reporting practices, providing a common basis for assessing operator performance.

Stakeholders in Nigeria's telecommunications and technology sectors have put forward a proposal for a National Telecom Sustainability Index, designed to systematically evaluate the environmental, social, and governance (ESG) performance of operators. This significant initiative, aimed at establishing a unified benchmark for assessing the sustainability of telecom companies, was formally introduced at the Telecoms and Technology Sustainability Working Group (TTSWG) Stakeholder Strategy Breakfast held in Abuja. The event, themed "Shaping the Future of Sustainable Telecommunications and Technology in Nigeria: A Shared Vision for 2027–2032," convened a diverse group of participants, including representatives from the Nigerian Communications Commission (NCC), various telecom and technology firms, and sustainability experts.

The proposed Nigeria Telecom Sustainability Index is intended to harmonize the distinct characteristics of Nigeria's telecommunications landscape with global best practices in sustainability reporting. By providing a common framework, it seeks to offer a clear and consistent method for measuring how well operators integrate sustainable practices into their operations. This development comes at a crucial time as the country's digital infrastructure continues its rapid expansion, underscoring the growing need for responsible and sustainable growth within the sector.

Chris Uwaje, a board member of TTSWG, presented the detailed structure of the proposed Nigerian telecom ESG framework, outlining five foundational pillars. These pillars are: Environment and Energy; Digital Inclusion and Affordability; Digital Integrity, Privacy and Consumer Trust; Infrastructure Resilience and Governance; and Supply Chain and Local Value Creation. Each pillar encompasses specific metrics designed to provide a comprehensive assessment of sustainability performance.

Under the Environment and Energy pillar, the index will scrutinize aspects such as the energy mix utilized by operators, their reliance on diesel, overall emissions, and strategies for telecom e-waste management Nigeria. The Digital Inclusion pillar focuses on critical areas like network coverage, penetration rates, affordability of services, and ensuring equitable access for all Nigerians. Digital Integrity will measure data protection protocols, fraud prevention, consumer complaint resolution, and overall service quality. For Infrastructure Resilience, the framework addresses challenges like vandalism, theft, fibre cuts, network restoration efficiency, right-of-way issues, regulatory compliance, and IPv6 readiness. Finally, the Supply Chain and Local Value Creation pillar incorporates Nigeria-specific considerations, including local content development, local currency financing, promotion of decent work, and job creation within the industry.

The impetus behind this comprehensive framework stems from a recognition of pressing challenges confronting Nigeria's telecommunications sector. Abdu-Waya Mohammed, Chairman of the TTSWG Board, highlighted several key issues the proposed strategy aims to tackle, including escalating energy costs, greenhouse gas emissions, the growing problem of electronic waste, persistent gaps in digital inclusion, and the imperative for more robust governance structures. The implementation strategy itself is slated to prioritize renewable energy adoption, further digital inclusion Nigeria efforts, foster social progress, strengthen governance, encourage innovation, and develop industry-specific sustainability metrics.

Beyond addressing operational challenges, the proposed metrics are also expected to significantly bolster investor confidence. As sustainability-linked financing becomes increasingly prevalent, investors are demanding measurable environmental, social, and governance performance from companies. Chris Uwaje emphasized this point, stating that investors rely on markets that build confidence and possess the necessary metrics for measurement. This initiative aligns with the ongoing expansion of Nigeria's telecommunications sector, where recent data from the NCC indicates sustained growth in broadband and mobile internet subscriptions, thereby amplifying the importance of resilient infrastructure, energy efficiency, and responsible management of telecommunications equipment.

It is important to note that the proposed National Telecom Sustainability Index remains in its draft phase. Abdu-Waya Mohammed explicitly stated that the framework presented is a preliminary document, and active feedback from all stakeholders is crucial for its refinement and successful implementation. This collaborative approach underscores the multi-stakeholder nature of the TTSWG, as highlighted by Bankole Oloruntoba, CEO of the Nigeria Climate Innovation Centre, which was established as a platform for such engagements.

The ongoing stakeholder engagement process is vital for shaping the final version of the index, ensuring it is robust, practical, and reflective of the diverse needs and realities of the Nigerian telecom industry. The call for input signifies a commitment to developing a framework that is not only comprehensive but also widely accepted and effectively implementable across the sector.

Lawyers and compliance officers advising Nigerian telecom operators should monitor the development of this proposed National Telecom Sustainability Index, as it will likely introduce new ESG reporting obligations and compliance metrics that could impact financing, operations, and regulatory exposure. They should also consider participating in the stakeholder feedback process to shape the final framework.

Source: Original reporting via The PUNCH.