IFC Calls for Tighter Enforcement of Environmental Frameworks, Regulation to Drive Compliance
Dike Onwuamaeze
The International Finance Corporation (IFC) has called for stricter enforcement of Environmental Social Governance (ESG) frameworks and regulations as a way of compelling developers in the real estate sector to incorporate ESG’s principles in their products and services deliveries.
This call was made over the weekend by the Lead Green and Resilient Built Environment for Nigeria International Finance Corporation, Ms. Temilola Sonola, during the Lagos Chamber of Commerce and Industry’s (LCCI) “2026 Real Estate/Construction and Engineering Sectoral Group Conference.”
The theme of the conference was “Mainstreaming ESG Compliance in Nigeria’s Engineering, Construction and Real Estate Sectors.”
Speaking during the panel session titled “ESD Compliance, Regulatory Framework and Environmental Sustainability in the Built Environment,” Sonola said that ESG principles were still being seen as optional by businesses because the government had not made them to bear the full financial costs of ignoring environmental sustainability.
She said: “The first point is that the cost of ESG has not been internalised.
“For example, you are building a house in a flood area and the flood comes and breaks it down. Who is going to bear the cost? Probably the government.
“I think that we need to internalise things a little bit more by some kind of regulation.”
She added: “One thing I know about Nigeria is that the framework is there and the laws and regulations are there.
“So, enforcement is probably one of the issues and if we can enforce a little bit more of our building laws then we can internalise the costs a little bit more.
“Because if you tell a developer that if you build this house here and erosion takes it down you are going to pay for it, he is likely to take more care.
“We are human beings. It is not going to happen if you do not enforce it. And that is what we need to do a bit more in Nigeria”
Sonola also said that there were cheaper sources of funds from the governments of The United Kingdom and Switzerland and development financial institutions like the IFC that would help developers who were ready to build sustainably to bear the cost of going green.
In his welcome address, the President of Lagos Chamber of Commerce and Industry (LCCI), Mr. Leye Kupoluyi, said that Nigeria’s economic future would be significantly influenced by “how we build and manage our infrastructure and urban systems.”
Kupoluyi said: “The trajectory of Nigeria’s economic future will be significantly influenced by how we build and manage our infrastructure and urban systems. The responsibility now lies with all of us to act decisively.”
“From an environmental perspective, the built environment remains one of the most resource-intensive sectors globally, responsible for energy-related carbon emissions,” he said.
According to him, the social dimension of ESG is critical in the Nigerian context with a housing deficit exceeding 17 million units and a rapidly growing urban population.
He said: “The governance component of ESG remains fundamental to unlocking the full potential of the sector.
“Persistent challenges in land administration, regulatory inconsistencies, and transparency continue to affect investor confidence and project delivery timelines.”
In his keynote address, the Group Managing Director/CEO of Global Property and Facilities International, Dr. M.K.O. Balogun said that in 2026, sustainability is now a capital investment decision rather than a mere environmental issue.
He said: “ESG data is now a ‘red flag.’ They are not just looking for a building; they are looking for a resilient asset.
“Across industries and markets, ESG is increasingly shaping how projects are financed, regulated and evaluated.
“For Nigeria, this shift carries particular significance and as the largest economy in Africa and one of the fastest-growing urban markets on the continent, the way we design and develop our built environment will directly influence our economic resilience and long-term competitiveness.
“Mainstreaming ESG is, therefore, not simply about environmental responsibility. It is about reducing investment risk, improving operational efficiency, attracting capital and ensuring that the infrastructure we build today remains valuable and resilient for tomorrow.”
The Chairman of the Real Estate Group, LCCI, Dr. Michael Oladiji, said that the theme of the conference was timely and critical because ESG principles were no longer optional ideals, “they are now central to how investments are evaluated, how projects are delivered, and how much of long-term value is created,” adding that “for operators in the built environment, the implications of adopting ESG principles or standards are profound.”
