A legal framework aimed at regulating Corporate Social Responsibility practices in Nigeria is currently in development, following the submission of a report by the House of Representatives Committee on CSR, led by Prof. Lilian Orogbu.
This report followed the introduction of a bill for an act to govern CSR and related matters on Wednesday, November 8, 2023.
The bill’s provisions, among others, include the establishment of a Department of Corporate Social Responsibility within the Federal Ministry of Industry, Trade and Investment, with branches across all states of the federation.
An exclusive copy of the bill obtained by The PUNCH on Sunday, highlighted its main goal, which is “Integrating long-term economic, environmental and social aspects in business strategies while maintaining global competitiveness and reputation.”
Additionally, the bill suggests the creation of a department to “Support and encourage the implementation of measures to improve CSR in Nigeria; coordinate activities of agencies relating to CSR in Nigeria and collate, analyse, interpret and disseminate information relating to CSR in Nigeria.”
In its findings, the committee recommended the appointment of a commissioner, who would be selected by the president based on the minister’s recommendation.
The commissioner’s duties would include, but not be limited to, “Making on behalf of the government, grants of financial assistance in relation to CSR in Nigeria; advise the Minister about CSR in Nigeria and consult and cooperate with other persons, organisations and governments on CSR in Nigeria.”
The committee also recommended that “Every company (Non-extractive) having a net worth of N500m or more or turnover of N100m or more during any financial year shall constitute a Corporate Social Responsibility Committee consisting of at least three or more directors, out of which at least one director shall be an independent director.”
For extractive companies, the committee proposed that any company with a net worth of N200m or a net profit of N50m should form a CSR committee of the same size as non-extractive companies.
Lastly, the committee recommended a penalty of two years’ imprisonment without an option of fine for any corporate violation of the proposed act, or a fine “Not less than thrice the amount that ought to be spent as CSR.”
