AfriPulse
Billions in sustainable finance are waiting to be tapped. Nigerian businesses must learn how to access them.
Across boardrooms in Nigeria and Africa, a silent capital shift is underway. While many businesses still focus on traditional loans, a much larger pool of funding is expanding globally, and that is climate finance. The real question is no longer whether sustainable finance exists, but whether African businesses are positioned to access it.
Green bonds and climate funds represent one of the most significant capital opportunities of this decade. For Nigerian companies navigating energy transition pressures, infrastructure gaps, and climate risk, this is not just sustainability. It is a strategy.
The rise of Green Finance and Africa’s position
Globally, green and sustainable bonds are growing rapidly, and Africa is beginning to establish its footprint. By mid-2025, African issuers had collectively raised roughly $9.6–10 billion through green and sustainable bonds across about 70–80 deals.
Yet, this is still a fraction of global issuance, and Africa is still way behind global issuances. What this means is that the growth potential remains enormous.
Development finance institutions are accelerating the momentum. The African Development Bank alone allocated $5.5 billion to climate finance in 2024, nearly half of its total approvals, supporting renewable energy, green transport, and climate-resilient infrastructure across the continent.
The signal is clear: capital is moving toward climate-aligned investments. African businesses must follow.
Nigeria: A continental pioneer, but still under-utilising opportunity
Nigeria has quietly built a strong reputation in green bond markets. In 2017, Nigeria became the first African country to issue a sovereign green bond, raising N10.69 billion to finance solar power, rural electrification, and climate projects.
Since then, momentum has grown:
Nigeria recorded four green bond issuances within three years of its debut.
According to the Nigerian Investment Promotion Commission, the 2019 sovereign bond was oversubscribed by over 200%, demonstrating strong investor appetite.
In 2025, Nigeria issued a N50 billion Series III Sovereign Green Bond to finance renewable energy, clean transport, water security, and climate adaptation projects.
The 2025 offer attracted subscriptions of over N91 billion, which is a powerful signal of market confidence.
At the sub-national level, Lagos State has also demonstrated leadership, issuing a green bond as part of a N244.8 billion financing programme linked to climate-resilient infrastructure.
Despite this progress, corporate Nigeria is still under-represented. Public sector issuances dominate, while private sector participation remains limited.
Corporate Africa: Where the next growth wave will come from
There are strong corporate precedents. In Nigeria, North South Power issued an N8.5 billion corporate green infrastructure bond linked to hydroelectric power, supported by credit enhancement from development finance partners.
Across Africa, cities like Cape Town and Johannesburg have issued municipal green bonds, while South Africa has built regulatory frameworks that encourage sustainable listings and investor participation.
The next phase will be driven by corporations, particularly in energy, agriculture, manufacturing, real estate, and infrastructure.
Climate funds: The bigger pool many businesses ignore
Beyond bonds, climate funds are deploying billions into emerging markets.
Africa faces an estimated climate financing need of over $277 billion annually to meet climate goals, which is far above current funding levels.
This gap is not only a risk. It is an opportunity.
Global climate capital is looking for:
-Bankable projects
-Transparent governance
-Measurable environmental impact
-Strong ESG reporting
Businesses that can demonstrate these will attract blended finance, which will combine grants, concessional loans, and private investment.
Why many Nigerian businesses still miss out
Three barriers persist:
1. Limited project structuring capacity
Many companies have green projects but lack climate-finance-ready documentation.
2. Weak ESG data systems
Investors now expect auditable sustainability metrics.
3. Perceived risk from investors
Currency risk, policy risk, and governance risk still affect capital flows.
These are solvable, but they require intentional strategy.
The strategic imperative for Nigerian businesses
To access climate finance, businesses must shift mindset:
Think beyond “raising money”. Think “qualifying for capital”.
This means:
-Embedding ESG into core business strategy
-Structuring projects with measurable climate impact
-Partnering with development finance institutions
-Investing early in ESG reporting capability
The leadership opportunity
The global capital market is not waiting. It is reallocating.
Green bonds are no longer experimental instruments. Climate funds are no longer theoretical pools of money. They are active, scaling, and increasingly selective.
The question Nigerian business leaders must ask is simple:
When sustainable capital flows into Africa at scale, will your business be ready to receive it?
Because the future of finance is not just green.
It is strategic, structured, and already moving.
Sarah Esangbedo Ajose-Adeogun is the Founder and Managing Partner at Teasoo Consulting Limited, a foremost ESG consulting firm. She is a former community content manager at Shell Petroleum Development Company and served as the special adviser on strategy, policy, projects, and performance management to the Government of Edo State. She is also the host of the #SarahSpeaks podcast on YouTube @WinningBigWithSarah, where she shares insights on leadership, strategy, and sustainable growth.
Source: Businessday.ng | Read the Full Story…
