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Nigeria’s Energy boardrooms: Why are the women outside? 

The question is how can we make more female CEOs in the energy sector?

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On March 8, various energy companies in Nigeria rolled out beautiful designs, marking International Women’s Day, with lovely quotes splashed across, paying homage to women. Unfortunately, this homage is nothing more than lip service if women are still kept outside their boardrooms.

An International Energy Agency (IEA) commentary reveals that fewer women reach senior roles in the energy sector than in the broader economy. The commentary further revealed that boardroom participation in energy companies for women is between 3-4% compared to other sectors like finance and communication that have up to 21%.

Cecilia Tam, an analyst with the IEA in a 2018 report quipped “The energy sector remains one of the least gender-diverse sectors in the economy”. One research by S&P Global shows that only 1% of CEOs in oil and gas companies around the world are women, with women holding less than 17% executive jobs in the sector. A recent LinkedIn analysis found that women make up just 26.7% of all oil and gas industry profiles on the platform, the lowest percentage of any of the dozen industries examined in the analysis.

READ: 5 Lessons from Dr Ngozi Okonjo-Iweala’s win for the working girl

The Wall Street Journal, in a report titled “Where Are All The Female CEOs?” examined why with women earning majority of college degrees today and making up roughly half of the workforce, there is still a very negligible percentage of women CEOs. These statistics are worrying, and do in fact question the pomp and pageantry employed in marking International Women’s Day across these companies. The Nigerian energy sector has become a boys club. A critical look at the top ten oil and gas companies in Nigeria reveals that they all have male CEOs.

So how can we make more female CEOs in the energy sector? As the Wall Street Journal points out in one report, “the traditional stepping stones to the Chief Executive position are jobs responsible for the bottom line and those roles are still overwhelmingly filled by men”. With women left out of these roles where their work directly contributes to the bottom line and their managerial/leadership expertise is determined, there is no training ground for them or opportunity to assess their abilities there. As such when appointments to C-Suite positions are made, they are not considered. Instead, these women typically hold support roles in information technology, human resources and legal.

READ: Young women and lifestyle inflation: Tips to get your financial life on track

There is no justification for women being outside the boardroom. An S&P Global market Intelligence report revealed that companies with women in the boardroom tend to perform better than those that have less gender-diverse boards and companies with more gender-diverse boards tend to have higher credit ratings.

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A study by the Petroleum Equipment and Services Association (PESA) found that companies with at least 30% female leaders end up raking in 6% higher net margins, and companies with a higher percentage of women in executive positions have a 34% higher total return to shareholders than those that do not. A McKinsey research showed that companies in the top quartile for executive team gender diversity are 21% more likely to experience above-average profitability than those in the fourth quartile.

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READ: 10 barriers to successful entrepreneurship for women in Nigeria

There is more – A World Economic Forum (WEF) study has shown that companies with strong female leadership deliver a 36% higher return on equity while Grant Thornton reports that companies with at least one female executive board member have historically outperformed those with male-only boards. American Express in its leadership style research reveals that women outperform men in 12 of the 16 essential leadership traits.

With these overwhelming statistics, it is counterintuitive for the Nigerian energy sector to keep its women out of the boardroom. Also, in the very few places where we have women energy company CEOs in Nigeria, we can see the commendable work they have done; Audrey Joe-Ezigbo with Falcon Oil, Catherine Uju-Ifejika with Brittania-U, Amy Jadesimi with LADOL, amongst others.

READ: Nigerian women need over 50% representation in government by 2023

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Supporting women starts with disbanding the boys club. And this has to be intentional. There has to be a positive commitment of Nigerian energy companies and their leaderships to promote a culture that openly encourages women participation. These companies should invest in scholarships, mentorship programs, career talks in schools and other programs for young women, encouraging them to explore STEM fields in order to increase the number of women seeking energy sector careers.

They should openly advance gender-equality goals and place women in more functional, leadership and managerial roles, rather than only support roles. In recruiting, they should be intentional about providing incentives for women, like a clear path to the top, flexible hours, maternity leave that does not compromise women’s work benefits and ample career development prospects.

We cannot honestly say the future is female when the female is outside our energy boardrooms. This essentially means we are locking the future outside. Perhaps that accounts for the snail-paced nature of Nigeria’s energy industry so far.

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Caleb Adebayo is an LLM Candidate, Energy and Environmental Law at New York University School of Law. His interest lies at the intersection of Energy, Environment and Finance and he is keen on the interplay between Law, Policy and Energy Markets. Prior to taking up his LLM, he worked on the Energy team of a tier 1 Nigerian law firm. A nominee for The Future Awards Prize for Lawyers, he has written widely on the subject of Energy and Environmental Law. He is also a member of the New York City Bar Energy Subcommittee

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    Columnists

    CIFI: Despite CBN funds, can the creative industry thrive in this environment?

    The Nigerian technology ecosystem is at its nascent stage, and beyond money, there is the need to ensure an enabling environment for operators.

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    Despite a frail 2020 for the Nigerian economy, there was a bit of silver lining. The Nigerian Information, Communication, and Technology (ICT) sector emerged as the leading segment of the economy aiding the country’s exit from recession by a whisker in Q4 2020.

    The development, in effect, justifies to some extent, the earlier decision of the Central Bank of Nigeria (CBN) to create the Creative Industry Financing Initiative (CIFI) to support businesses in the following areas:

    • Fashion
    • Information Technology
    • Movie Production and Distribution
    • Music

    The CBN began to contemplate the idea of the CIFI following the influx of private investment into the technology space in 2019. For instance, according to the African Tech Start-ups Funding report for 2019, Nigeria got foreign exchange inflows totalling US$137.9m in the period.

    This continued into 2020, considering that despite the pandemic, the sector still attracted an additional US$122m in seed funding. Furthermore, the sector contributed 13.12% of the total real Gross Domestic Product (GDP) of Nigeria which came to N19.53tn as of Q4 2020.

    Evaluating the progress made so far with the CIFI, as of Q3 2020, the CBN had reportedly disbursed c. N3.12bn in intervention to 320 beneficiaries. While there are concerns around the tenor of the loan for Software Engineers and accessibility of funds to other technological entrepreneurs, we laud the CIFI and encourage relevant agencies to do more.

    The Nigerian technology ecosystem is at its nascent stage, and beyond money, there is the need to ensure an enabling environment for operators. For instance, the recent BVN concerns that rocked the financial technology space and the regulatory uncertainty which is a key risk for telecommunication operators among other concerns, are issues that should be decisively dealt with.


    CSL Stockbrokers Limited, Lagos (CSLS) is a wholly owned subsidiary of FCMB Group Plc and is regulated by the Securities and Exchange Commission, Nigeria. CSLS is a member of the Nigerian Stock Exchange

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    Book of States 2020: Vast resources, low industrial development

    State governments have been heavily reliant on FAAC distribution to meet recurrent expenditure, thus making no room for capital spending. 

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    Oil Price Crash: Governors to meet on budgetary and economic issues, Insecurity: Governors to meet on Wednesday over rising insecurity
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    The Nigerian Investment Promotion Commission (NIPC) in a recent report titled “Book of States 2020” highlighted the investment prospects of the 36 states of the federation including the Federal Capital Territory (FCT) to steer attention to the subnational investment opportunities in Nigeria. We note that the report is an outcome of a partnership between the commission and the Nigeria Governors’ Forum (NGF) to showcase the key investment opportunities for each state.

    The report focused on the key areas of physical capital (airports, railway stations and seaports), resources (natural and minerals) and demography (population and labour force) of each state including their Internally Generated Revenues (IGRs), budget spending and household consumption.

    While we acknowledge the decrepit infrastructure as a major hindrance to the growth of businesses and economic prosperity of many states, we note the little emphasis placed by the states on financing capital projects to attract private sector investments. Over the years, state governments have been heavily reliant on FAAC distribution to meet recurrent expenditure, thus making no room for capital spending.

    The truth is that as long as state governments do not make desperate efforts to develop their internal revenue-generating capacity, the states in the country would continue to operate an inefficient rent collection system where they rely solely on FAAC allocation to meet basic needs such as paying workers’ salaries.

    In our view, we believe the efforts to revive the ailing status of many states depend on the effectiveness and soundness of policies made to propel investments. Currently, Nigeria has enormous potentials to improve tourism given its ample amount of resources to attract both local and international tourists. Many countries in the continent such as South Africa, Kenya and Morocco have made great fortunes from tourism.

    Over 50% of the states have recorded no foreign direct investments over time due to little or no requisite infrastructure needed to attract capital inflows amid untapped resources in these affected regions. Also, we believe the Federal Government needs to relax its control on some of the state-owned resources to enable the states better exploit these resources.


    CSL Stockbrokers Limited, Lagos (CSLS) is a wholly-owned subsidiary of FCMB Group Plc and is regulated by the Securities and Exchange Commission, Nigeria. CSLS is a member of the Nigerian Stock Exchange.

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