What We Did To Make Nigeria’s Sovereign Wealth Fund Attractive To Local, Global Partners– Orji, NSIA Boss

The pioneer Chief Executive Officer of the Nigeria Sovereign Investment Authority (NSIA), Uche Orji, has said that winning the trust of shareholders was one of the prominent challenges that he contended with in the early years of setting up the Sovereign Wealth Fund.

Like other state-owned establishment in Nigeria, Orji said he was also faced with the problem of selling the NSIA to foreign partners.

According to him, the NSIA has 112 shareholders, states governments, local governments the Federal Capital Territory and the Federal Government.

Describing his journey so far as a ‘sweet bitter experience,’ Orji said the NSIA has evolved into a world class establishment.

The NSIA was founded in 2011 under the administration of former President Goodluck Jonathan with Orji setting up the institution from the scratch.

Ten years after founding the NSIA, Orji has built its wealth to $2.83bn (N1.228trn) from $1bn seed capital invested in the third quarter of 2013.

Additional $600m was been injected to the NSIA since 2016.

Orji said, “In every society, you have to manage your stakeholders be it in recruiting, be it in deciding where to invest. It is just over time your stakeholders trust you, you will be fine. I think we are at that point.

“Healthcare for example, is an area of unique maximum impact for us. We have seen just LUTH Cancer Centre alone in the last 18 months has had 200,000 patient encounters. We have seen the toll roads, second Niger Bridge, Lagos Ibadan and Abuja-Kano Road.

“We have seen in agriculture, the fertilizer initiative, we have seen investments in tech and I think the fact that NSIA could do that, in all of this, the Nigerian factor is not an excuse for not achieving some level of success.”

According to Orji, the NSIA has proven itself to be a stately profitable entity which is important in getting credibility internally.

He explained that the “NSIA has had catalytic effect in the number of sectors where it wanted to focus on, be it agriculture, healthcare, toll roads, financial market infrastructure and more recently in tech and power.

“But I think it has also gained significant external credibility. For seven or eight years in a row it has been ranked top quartile by the Sovereign Wealth Funds Institute in terms of transparency and governance which I think is very important for an entity like ours to earn credibility both at home and abroad.

“Being able also to win the support of our stakeholders particularly the Federal Government and the State Governments is for me a big mark that it has been accepted domestically as well.

“Getting to that point for me is a real point of joy. International credibility, domestic credibility, strictly profitable organization with impactful interventions in a number of sectors, those are the things one should measure.”

But before getting to this point, Orji disclosed that he set up structures that made the NSIA transparent and accountable.

“Everything ends, whether good or bad. The beginning of NSIA was very controversial. When I arrived, it was a kind of a stunt between the State Governments and the Federal Government. I remember my first interaction at the National Economic Council. That was very terrifying I must say. Then I realized the most important thing the organization needed was to build credibility internally, he said.

According to him, the NSIA needed to be accepted by all the stakeholders, adding the “NSIA has about 112 shareholders, 774 LGAs, 36 States, the FCT and the area councils and the Federal Government. Winning their trust was perhaps for me the most important challenge.”

He narrated that the NSIA achieved that by being accountable.

Orji said, “We published our account every quarter, PricewaterhouseCoopers House reveals and then audits and put on our website. We discussed with them the performance of the organisation, the accounts every year the same way you threat any publicly held entity.

“You go out there and you explain what you have done with their money and what you have made. That is the first. The second is we had to provide them an instrument of ownership. So, we have certificates, a uniquely identified certificates or what you may call share certificates in the organization.

“We treated the annual meeting like you will treat any annual general meeting where we showed real accountability. That started to build gradually. It took time but after the first, second and third year and they saw the organization was profitable, PricewaterhouseCoopers were our auditors and provided their statement and that gave them some comfort.

“The second was also translating that internationally. We needed international credibility as well because 60 per cent of our asset’s allocation is actually largely international. It declined now to 50 per cent. So, we invested in a bunch of assets from private equity, public equity fixed incomes, treasuries internationally.”

He revealed that at the beginning, it was difficult to get some of the service providers to “take our money, because it was strange for them.”

The NSIA boss said having the Sovereign Wealth Funds Institute rate the NSIA very high played a fundamental role in boosting stakeholders’ confidence.