SOStainabilityWeekly

By Oke Epia, E-mail: sostainability01@gmail.com  | WhatsApp: +234 8034000706

Trends and Threads

Nigeria’s Transportation and the Decarbonisation Challenge

Nigeria’s transport sector is heavily reliant on fossil fuels, with road transport accounting for over 90 percent of internal goods movement. This dependence contributes significantly to the nation’s carbon emissions, with transportation responsible for 21 percent of Nigeria’s greenhouse gas emissions, a figure that continues to rise as urbanization and economic growth accelerate.

While Nigeria’s transport and logistics sector is critical to the economy, it also presents a significant environmental challenge. As the world intensifies efforts to combat climate change, Nigeria faces the difficult task of balancing economic growth with reducing its carbon footprint.

According to Nigeria’s Third Nationally Determined Contribution (NDC 3.0), the transport sector has a mitigation potential of 44.3 Mt CO2e. Key measures to reduce emissions include the adoption of electric and compressed natural gas (CNG) vehicles, with targets like replacing diesel with CNG in 50 percent of locomotives by 2035 and transitioning 30 percent of the road transport fleet to electric vehicles.

So, what must Nigeria’s transport and logistics sector do to meet global sustainability targets? It’s clear that innovation, policy reform, and a climate-first regulatory framework are crucial. However, true progress will only be achieved when these actions are aligned with Nigeria’s infrastructure realities and regulatory landscape.

The State of Nigeria’s Transport Sector

Nigeria’s transport sector has grown exponentially over the past few decades, driven by rapid urbanisation, population growth, and increasing demand for goods and services. Yet, this growth has come at a cost. Road transport accounts for more than 90 percent of the internal movement of goods and passengers, and with that comes a heavy reliance on fossil fuels. This dependence has resulted in significant greenhouse gas emissions, making the transport sector one of the leading contributors to Nigeria’s carbon footprint.

While road transport dominates, other modes, such as rail and maritime, remain underdeveloped. The poor state of road infrastructure, combined with a fragmented logistics system, exacerbates fuel inefficiency and increases emissions. As a result, Nigeria’s transport sector not only contributes to environmental degradation but also faces enormous economic and public health costs, including high fuel consumption, increased air pollution, and poor road safety.

Are Regulations and Compliance Moving Us Toward Sustainability?

Regulations are key to driving the transformation of any sector, but in Nigeria’s transport and logistics industry, the current framework is largely focused on safety and infrastructure. While important, these regulations have not sufficiently addressed the climate impacts of the sector. For instance, compliance requirements like vehicle inspections, axle load limits, and freight forwarding regulations aim to ensure safety and efficiency. However, these measures don’t fully incentivize or require operators to consider emissions or fuel efficiency as part of their operations.

To align with global climate goals, Nigeria needs regulations that prioritise sustainability. This could include mandating lower emissions for all new vehicles, incentivizing the use of cleaner fuels, or establishing stricter penalties for non-compliance with environmental standards. Without such regulations, the industry will continue to contribute to the climate crisis without any significant change.

Where Nigeria Can Start?

The path to a cleaner transport sector does not need to be an all-or-nothing proposition. While transitioning to electric vehicles (EVs) might be a long-term goal, there are several practical and cost-effective steps Nigeria can take in the short term. Here are some key actions that could yield immediate results:

Optimizing Freight Movement: Many emissions come from inefficient freight movement. Poor infrastructure, long wait times at ports, and empty trucks making return journeys are major contributors to fuel waste. Streamlining the logistics network by optimizing routes, improving port efficiency, and encouraging shared loads can reduce fuel consumption and emissions. Simple improvements in efficiency can have a massive impact on reducing the carbon footprint of the sector.

Improving Road Infrastructure: Roads in Nigeria are often poorly maintained, leading to longer travel times and higher fuel consumption. Investing in infrastructure upgrades, including better road quality and intelligent transport systems, would reduce these inefficiencies and contribute to significant emissions reductions

Adopting Cleaner Fuels: While Nigeria may not yet be ready to transition fully to EVs, the introduction of cleaner fuels like Compressed Natural Gas (CNG) could serve as a bridge. CNG is cheaper and more environmentally friendly than traditional diesel, and Nigeria could incentivize its adoption through subsidies or tax breaks for operators who switch to cleaner fuels.

Public Transport Expansion: Expanding and improving public transport systems is one of the most effective ways to reduce emissions. The expansion of Bus Rapid Transit (BRT) systems in urban areas, along with investments in rail, could reduce the number of private vehicles on the road, leading to fewer emissions and less congestion.

Need for a Just Transition

One of the major concerns in Nigeria’s push for a greener transport sector is the potential economic impact on workers. A just transition, one that balances environmental sustainability with economic and social equity is essential. Nigeria must ensure that the workers who rely on the fossil fuel-based transport system are not left behind. This includes retraining programs for those involved in the transport and energy sectors, as well as policies that encourage local job creation in the green economy.

The country must also ensure that new technologies and policies do not disproportionately increase transportation costs for consumers. The removal of fuel subsidies in 2023, while a necessary economic measure, has already led to increased transportation costs for many Nigerians. It is crucial that the government adopts policies that make sustainable alternatives not only environmentally friendly but also economically viable for the average Nigerian.

Washing and hushing

Corporate Social Investment: Getting It Right for Best Results 

A previous article on this page, “Social Value vs CSR: Why Companies Should Care,”presents a thoughtful discussion on how businesses in Nigeria can balance profit-making with societal well-being. It clearly distinguishes between Corporate Social Responsibility (CSR)- often philanthropic – and Social Value,which is more integrated into business strategy. This follow-up piece seeks to address the deeper systemic and structural challenges that prevent Nigerian companies from moving beyond tokenism toward measurable social transformation.

The Missing Lens: Accountability and Impact Measurement

One major gap in most CSR and Social Value discussions in Nigeria is the issue of impact measurement. Nigerian firms often publicize CSR projects through press releases, social media campaigns, and glossy annual reports, yet few provide verifiable data on the long-term outcomes of these initiatives.For instance, PwC Nigeria (2021) found that less than 30 percent of Nigerian organizations use measurable indicators to track the effectiveness of their social investments. Many companies can tell you how much they donated to a cause, but not how many lives were improved or how communities evolved as a result. Without transparency and standardized reporting frameworks like the Global Reporting Initiative (GRI) or Social Return on Investment (SROI), CSR remains largely performative.

Community as Beneficiaries, Not Partners

Too often, projects are decided in corporate boardrooms without local participation. As research has shown, community members are treated as beneficiaries, not stakeholders. This top-down approach creates mistrust and dependency, especially in oil-producing regions where companies’ “gifts” are seen as compensation, not partnership.Real social value emerges when communities co-designprogrammes- when women, youth, and local leaders are part of identifying priorities, implementing projects, and evaluating results. That is how social initiatives move from “charity” to “shared ownership.”

Culture of Compliance Over Commitment

Many Nigerian businesses engage in CSR because they have to, not because they truly believe in it. Regulatory frameworks and sectoral guidelines from the Nigerian Exchange now encourage sustainability reporting, but compliance often stops at box-ticking.A genuine shift toward social value requires embedding sustainability in the company’s DNA – in its supply chain, recruitment, energy use, and governance. For instance, few companies have integrated climate-conscious production systems or gender-inclusive procurement policies into their operations. The emphasis remains on short-term visibility, not long-term resilience.

Lack of Alignment Between CSR, ESG, and National Goals

Another area often overlooked is the disconnection between corporate initiatives and national sustainability goals. Nigeria’s Nationally Determined Contributions (NDCs), National Development Plan (2021–2025), and Energy Transition Plan (2022) call for private sector leadership in renewable energy, green jobs, and inclusive growth. Yet, most corporate CSR efforts remain scattered and unaligned with these frameworks.For example, while Access Bank’s Green Bond initiative aligns with global ESG standards, smaller firms lack the guidance or incentives to follow suit. This creates a sustainability gap between multinational corporations and indigenous businesses.

Moving Forward: What Companies Should Do Differently

To move beyond good intentions, Nigerian companies must redefine success from profits alone to purpose and performance combined. This requires embedding social value into business models not as side projects, but as part of how value is created and shared. It also requires measuring what matters using data-driven frameworks to track real impact and report transparently; building partnerships with communities and government to co-create solutions that reflect local; investing in employee engagement because true CSR begins internally, with fair wages, inclusion, and capacity development; and aligning with national and global sustainability goals ensuring every initiative supports broader climate and social objectives.

Events and Newsmakers

Bank of Industry Launches Groundbreaking ESG Report

Last week, the Bank of Industry (BOI) hosted its inaugural Environmental, Social, and Governance (ESG) conference in Lagos.The landmark event brought together leaders, innovators, and experts from across various sectors to advance the conversation on sustainable business practices in Nigeria. The conference theme, “Advancing ESG Adoption,” was a significant milestone in BOI’s ongoing efforts to support the sustainable industrialization of Nigeria’s economy.

The conference was not just a discussion forum; it also featured the launch of the highly anticipated “ESG Adoption by Nigerian Micro, Small and Medium Enterprises (MSMEs)” report. This report revealed critical insights into the barriers facing Nigerian businesses in embracing ESG principles, which will shape future initiatives aimed at supporting the MSME sector in adopting sustainability practices.

Dr. OlasupoOlusi, MD/CEO of BOI, presented the findings of the report, emphasising the need for enhanced support to MSMEs, which constitute over 80 percent of Nigerian businesses and play a pivotal role in driving the country’s economy. The report identified limited funding and lack of technical capacity as the largest barriers to ESG adoption among MSMEs. Other challenges highlighted in the report include inadequate policy-linked incentives, limited knowledge, and low customer demand for ESG-compliant products and services.

“MSMEs are the backbone of Nigeria’s economy, contributing nearly half of the nation’s GDP and employing millions of Nigerians,” Dr. Olusi stated. “For these businesses to remain competitive and thrive in a changing global economy, adopting ESG principles is not just necessary, it is an imperative.”

The conference also featured several insightful panel sessions focused on the practical steps Nigerian businesses can take to integrate ESG into their operations.