TLDR: Nigerian risk managers are proactively tackling potential challenges arising from rapid advancements in global ethical finance, artificial intelligence, blockchain, and decentralized finance. A recent roundtable highlighted a significant 195% increase in financial fraud losses in 2024, reaching N52.26 billion, underscoring the critical need for robust risk governance and ethical practices to maintain trust and stability in the financial sector.
Abuja, Nigeria – In response to the transformative landscape shaped by global ethical finance and technological innovations such as Artificial Intelligence (AI), blockchain, mobile banking, and decentralized finance (DeFi), Nigerian risk managers are intensifying efforts to mitigate potential pitfalls. This proactive stance was a central theme at a recent quarterly risk roundtable held in Abuja, organized by the Chartered Risk Management Institute (CRMI) in partnership with TajBank Limited, under the theme “Ethical Finance and Risk Governance.”
Dr. Jameelah Sharrieff-Ayedun, Managing Director and Chief Executive of Credit Registry, revealed alarming statistics, stating that Nigeria experienced a staggering 195% increase in financial fraud losses, which escalated to N52.26 billion in 2024. This significant rise underscores the urgency for enhanced risk management frameworks within the country’s financial ecosystem.
During the roundtable, Dr. Sharrieff-Ayedun emphasized the indispensable role of ethical finance and robust risk governance in fostering a stable, just, and sustainable global economy. She asserted that these principles are not merely moral preferences but are fundamental for preserving the integrity of financial institutions and sustaining the trust that binds markets, societies, and individuals. Dr. Sharrieff-Ayedun urged ethical bankers to view emerging gaps as opportunities for adaptation and innovation. She notably stated, “By creating a digital footprint for the customer, they see beyond traditional numbers to understand behaviour. Loyalty isn’t about gimmicks.”
Corroborating this sentiment, Mr. Kelvin Ugwuoke, President of the Chartered Risk Management Institute (CRMI), highlighted the paramount importance of risk governance in the current evolving dispensation. Discussions at the event underscored that the reckless pursuit of profit without accountability inevitably leads to both economic losses and a severe erosion of public trust. Trust, it was argued, forms the bedrock of any financial system, and its absence can lead to declining confidence, reduced investment, and stunted growth.
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Participants concluded that ethical finance is a strategic necessity, not just a moral imperative. Institutions committed to ethical operations demonstrate greater resilience, attract more loyal investors, and maintain stronger reputations, even amidst crises. The discourse advocated for a balanced approach where profit is weighed against purpose, and the environmental, social, and governance (ESG) implications of every investment, financing, or transaction are meticulously considered. The global financial crisis of 2008 and subsequent scandals were cited as stark reminders that a disregard for ethics invariably multiplies risks, reinforcing the critical need for vigilance and integrity in the financial sector.
