NSIA gets transparent rating by Sovereign Wealth Institute

The Nigerian Sovereign Investment Authority (NSIA) has received improved rating as sovereign wealth fund (SWF) by Linaburg-Maduell transparency index administered by Sovereign Wealth Institute.

In the official statement announcing the second quarter ratings, the Institute singled out NSIA for special mention, stating that the NSIA has been upgraded to nine points out of a possible 10 from a score four in the previous rankings.

This rating translates into a leap from a position of joint 33^rd and 2^nd; the only African sovereign wealth fund so ranked. With the latest rankings, the NSIA is ranked alongside sovereign wealth funds from the USA, France, South Korea, Brazil, and Malaysia.

More significantly, the improved transparency ranking validates NSIA’s commitment and adherent to highest prescription of Santiago Principles with respect to corporate governance, investment strategy, disclosures and SWF best practices.

Linaburg-Maduell Transparency Index was developed at the Sovereign Wealth Fund Institute by Carl Linaburg and Michael Maduell, and is a method of rating transparency in respect to sovereign wealth funds.

In arriving at the rankings, the index among others considers the following principles – fund provides history including reason for creation, origins of wealth, and government ownership structure, funds provides up-to-date independently audited annual reports, funds provides ownership percentage of company holdings, funds total portfolio market value, returns and management compensation, funds provides guidelines in reference to ethical standards, investment policies, and enforcer of guidelines, fund provides clear strategies and objectives if applicable, the fund clearly identifies subsidiaries.

Nigeria’s SWF was set up in 2011, with seed capital of $1 billion and is split into three funds.

The SWF hopes to safeguard oil revenues for future generations, with a future generations fund, provides a buffer against external shocks with a stabilisation fund and spur infrastructure development in Nigeria with its infrastructure fund.

The Nigeria SWF is the third-largest in sub-Saharan Africa, after the $6.9 billion Botswana and $5 billion Angola fund.

HOPE MOSES-ASHIKE