The Securities and Exchange Commission (SEC) has issued a firm directive to all publicly quoted companies in Nigeria to ensure the simultaneous publication of their periodic financial returns on their corporate websites.
This mandate, outlined in a circular released, signals the Commission’s intent to enforce stricter compliance with transparency regulations starting January 2025.
The SEC emphasized that failure to publish financial returns on corporate websites contravenes Rules 39 and 41 of its Rules and Regulations.
These rules mandate the public availability of financial information to enhance transparency and promote informed investment decisions.
According to the circular, companies who fail to comply with the simultaneous disclosure requirement from January 2025 will face sanctions, adding that timely, public access to financial data is vital for building investor confidence and ensuring fair market practices.
In Nigeria, quoted companies are required to file annual financial results with the SEC and the Nigerian Exchange Limited (NGX) within 90 days of the accounting year’s end.
They must also publish results in at least two national newspapers 21 days before the Annual General Meeting (AGM) and post them on their websites, with the website address disclosed in the newspapers.
The SEC highlighted the importance of this measure in strengthening the Nigerian capital market: “Ensuring that financial data is accessible on corporate websites enables investors to make sound decisions based on real-time and accurate information,” the circular noted.
The regulator also reiterated that timely disclosures are integral to fostering effective communication between companies and their shareholders.
Financial analyst Tunde Alabi remarked, “This directive is a step toward bolstering market integrity. When investors can easily access financial reports online, it reduces the reliance on intermediaries and creates a more transparent ecosystem.”
However, compliance consultant Bukola Akintunde noted potential challenges: “Many companies may need to overhaul their website infrastructure to meet these requirements. While this is an investment in transparency, the costs could be a concern for smaller firms.”
“This move will empower retail investors who often lack direct access to financial filings. Companies need to ensure that these reports are user-friendly and well-organized,” added investment advisor Chinwe Okoro.
The SEC’s warning serves as a wake-up call for companies to align with global best practices in corporate governance. By implementing this measure, the Commission seeks to promote a robust capital market that inspires confidence among domestic and international investors alike.
Market participants and regulators will closely monitor the implementation of this directive, with the success of this initiative hinging on the readiness of companies and the vigilance of enforcement agencies.