Nigerian companies and their carbon footprints

BY CHIMA IBE

Nigeria’s approval of the national carbon market framework marks a turning point in the country’s climate and development trajectory. As Africa’s largest economy prepares to participate more actively in global and regional carbon markets, one foundational requirement stands above every other: companies must understand, measure, and report their carbon footprints.

Without accurate emissions data from the private and public sectors, Nigeria cannot fully unlock the economic, environmental, and investment opportunities that the carbon market offers. This single step will determine whether the new framework becomes a transformative tool or a missed opportunity.

Nigeria has committed to reducing emissions by 32.2 percent under its updated Nationally Determined Contribution (NDC 3.0) by 2035. Achieving this target demands more than policy pronouncements. It requires a reliable national emissions inventory built on factual, organisation-level data.

Mandatory emissions reporting is already included in the government’s five-year roadmap, with implementation expected in 2027. For companies, this timeline should serve as an urgent call to action. Preparing for reporting will involve: developing internal emissions policies and procedures, training staff and building technical expertise, hiring or partnering with qualified professionals, establishing credible data collection and verification processes and understanding the regulatory landscape ahead of compliance deadlines, etc. Organisations that begin early will be better positioned to adapt, comply, and benefit.

The carbon market framework aims to spur investment, encourage emissions reduction efforts, and support Nigeria’s long-term economic and climate objectives. It also seeks to increase collaboration across sectors, enabling companies to meet their own climate targets while contributing to national goals.

For Nigeria, the stakes are high. The country is targeting roughly three billion dollars annually in climate-related investment over the next decade. Accessing this level of finance will depend heavily on the credibility of emissions data generated by Nigerian companies. When organisations understand and manage their carbon footprints, investors and trading partners gain confidence in the country’s climate commitments and regulatory environment. This credibility cannot be achieved through frameworks and declarations alone. It requires measurable action from companies across all sectors.

Understanding emissions is no longer simply an environmental exercise. It is a strategic business decision affecting competitiveness, market access, and long-term resilience. When organizations know their carbon footprint, they can: evaluate risks related to climate regulation and market shifts, identify cost-saving efficiency opportunities, design cleaner products and services and choose sustainable technologies and operational models. They will also have the capacity to comply with emerging domestic and international reporting requirements, enhance corporate reputation through transparency and participate in both compliance and voluntary carbon markets

For Nigerian companies expanding into other African markets, emissions data is becoming a central requirement for partnerships, financing, and regulatory compliance. Carbon footprinting will soon be as essential as financial reporting.

If Nigerian companies fail to prepare for mandatory reporting, the country risks repeating a familiar scenario: foreign firms dominating a strategic national sector while domestic players remain on the sidelines.

Carbon markets reward early movers. Companies that calculate their emissions, publish credible sustainability reports and engage in reduction or offset projects are the ones that will benefit from trading, investment, and partnerships. Without this foundation, Nigeria may create a carbon market where international organisations participate actively while local firms serve merely as observers.

A strong domestic ecosystem—built on accountability, public reporting, transparency, and collaboration—is essential for Nigeria to fully benefit from Article 6 of the Paris Agreement and related market mechanisms.

Recent global climate dialogues, including COP 30, have focused heavily on climate finance, investment flows, energy transition pathways, and support for locally led mitigation efforts. Countries that demonstrate readiness through credible reporting systems remain better positioned to attract funding and partnerships.

If Nigerian companies embrace carbon footprinting early, the country will strengthen its claim as a climate-resilient and investment-ready destination, attract high-value climate projects and green industries, support innovation in clean energy, infrastructure, and technology and reduce long-term economic vulnerabilities tied to oil dependency. Carbon accounting is not merely a compliance activity; it is an enabler of Nigeria’s sustainable economic future.

Nigeria’s carbon market framework offers a major opportunity to drive investment, support national climate targets, and reposition the country for a low-carbon global economy. But the effectiveness of this framework depends on one critical factor – credible emissions data generated by Nigerian organisations.

Companies that invest now in understanding and reporting their carbon footprints will not only support national objectives but also strengthen their competitiveness, resilience, and access to emerging markets. The transition has already begun. Nigerian organisations must ensure they are not left behind.

Chima Ibe, an energy and carbon finance expert, can be reached via [email protected]