“Investing can lead to financial freedom and wealth accumulation over time. However, it requires patience and careful planning. Here, it is important to set clear financial goals and have realistic expectations. But as investments typically grow gradually, it may not be a means for quick gains”
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The National Coordinator, Independent Shareholders Association of Nigeria, Mr. Moses Igbrude while responding to media chat with our Correspondents, Amarachi Onyemma, and Chidera Eke last week in Lagos , said that, any economy that does not promote investment opportunities, financial disclipline and stockbroking may run into economic crisis, pin-pointing the current Nigeria’s situation. Mr. Igbrude has spent two decades in the association which has provided solid ground for his leadership strides and achievements, ranging from reviewing the association’s Constitution, holding the first annual general meeting, and engaging with stakeholders like the Nigerian Stock Exchange and the Financial Reporting Council.
He wants the country’s economic challenge, such as high interest rates and multiple taxes reduced, while emphasising the importance of long-term investment strategies and financial prudence.
Excerpts
Sir, may we know you
I am Moses Igbrude, the National Coordinator of the Independent Shareholders Association of Nigeria. Our organization represents minority shareholders, working to amplify their voices, interact with companies, while protecting and enhancing their investments. Our association was established about 30 years ago, and I’ve been an active member for over 20 years, taking on various roles before being elected as the leader last year. My extensive experience in the association has prepared me well for leadership role.
What are your landmark achievements in the association.
I have been deeply involved in organizing and structuring the association. I started by reviewing the Constitution, holding our first annual general meeting, and producing and filing the annual report with the CAC. I also focused on improving the meeting hall and consolidating our investment properties by obtaining their titles. My efforts include making the association knowledge-driven by providing members with investment information and training, and organizing monthly meetings to educate them about capital markets while engaging with various stakeholders, including the Nigerian Insurance Commission, the Nigerian Stock Exchange, and the Institute of Internal Auditors. I also plan to meet with new officials like the Commissioner of Insurance and the Financial Reporting Council’s new Executive Secretary. Additionally, I’ve been advocating for the association by addressing issues such as multiple taxes and hostile business environments with the government. I use meetings, interviews, and press releases to communicate our concerns and provide feedback on business performance.
Has the current economic challenge affecting the association
The business environment is indeed challenging, and the difficulties faced by companies have direct impact on their shareholders. When a company is struggling financially, it affects not only the company’s profitability but also the dividends and returns paid to investors. For example, many multinational companies operating in Nigeria, such as Nigerian Breweries, Guinness, and Nestlé, face significant challenges due to devaluation and foreign-denominated loans. These issues lead to exchange losses that can wipe out profits and reserves, affecting their ability to pay dividends. The broader economic challenges, including high levels of taxation and inadequate infrastructure, further exacerbate these issues. Companies often bear additional costs for services like security, water supply, and electricity that the government should ideally provide. Local and federal taxes, as well as informal extortion by non-state actors, also place a financial burden on businesses.
These issues not only increase operational costs but also contribute to a hostile business environment. Moreover, the economic difficulties experienced by companies can lead to staff layoffs, contributing to the Japa syndrom where trained workers leave the country in search of better opportunities. Additionally, the unpredictability of government policies—frequent changes and policy reversals—creates an unstable business environment. Cybercrime and other emerging threats further complicate the situation. These factors combined can significantly impact company’s performance and, consequently, their shareholders. Therefore, addressing these economic and infrastructural issues is crucial for improving the business climate and protecting the interests of investors.
With this whole challenge, can you see better prospects coming, especially with the harsh economy?
I believe that in every challenge, there are opportunities. Because survival is crucial, we must find ways to endure, no matter how tough the situation becomes. If we survive, we risk being consumed by the challenge. That’s why it’s important for us to stay innovative and find solutions to manage these difficulties effectively. One major problem we’ve seen across manufacturing businesses in Nigeria is the impact of price increases. When prices are raised too high, people stop buying, which affects everyone. We urge the government to implement supportive policies and collaborate with the private sector for job creation creates jobs. Politicians often promise job creation, but is up to private organizations to provide employment in a healthy economy. The current business environment is challenging, especially with high interest rates. When interest rates are as high as 24%, 26%, 30%, or even 40%, it becomes nearly impossible to repay loans and sustain operations. We need the government to address these issues to improve the business climate. Despite these difficulties, we must continue to find ways to survive and thrive.
Highlight the process and the benefits of investing in the capital markets.
An investment is any asset or venture that you put resources into with the expectation that it will generate value or profit over time. This could be through providing a service, owning shares, or any other means where others are willing to pay for what you offer. In the stock market, companies issue shares to the public to raise capital. These shares can be bought and sold by investors on exchanges. Initially, a company might sell shares through an Initial Public Offering (IPO). After purchasing shares, investors can trade them in the market, where their value fluctuates based on various factors. To buy or sell shares, you typically need to work with a stockbroker. You open an account with a stockbroker, who will handle the buying and selling of the shares on your behalf. You provide instructions to your broker, and they execute trades for you. Technological advancements now allow many of these transactions to be managed through mobile apps.
Investing involves several steps. First, you need to research and decide which stocks or assets you want to invest in. Next, open a trading account with a stockbroker. After setting up the account, you can buy shares through your broker. Trading involves buying or selling shares as needed, with transactions often facilitated through an app or online platform. Investing can lead to financial freedom and wealth accumulation over time. However, it requires patience and careful planning. Here, it is important to set clear financial goals and have realistic expectations. But, as investments typically grow gradually, it may not be a means for quick gains. Modern technology has simplified the investment process, allowing for real-time trading and account management via mobile devices. Embarking on a journey towards financial stability and growth involves careful planning and consistent effort. One crucial first step is to make a decisive choice about your investment strategy. For many, the capital markets offer a viable path. With this approach, even modest amounts of money can be invested—whether 1,000 or 2,000. In the capital market, you have the flexibility to buy shares in small quantities, and what truly matters is not the amount you invest initially, but the consistency of your investment over time. Having made this decision, the next essential step is to focus on generating income. Whether through your job or other means. So, earning money is necessary to fund your investments.
It’s important to save a portion of your earnings specifically for investment purposes. This saved money should not be used for immediate needs but rather an investment for grow. Consistency in saving and investing is key. Allocate a percentage of your income regularly to your investment portfolio. Small regular investments can also compound into substantial returns. Avoid the temptation to withdraw funds from your investments for short-term needs. Instead, rely on dividends or interest from your investments to cover expenses when possible. Treat your invested capital as if it’s not readily accessible to avoid the risk of prematurely accessing it. Discipline is critical to this strategy. Building a routine of setting aside and investing a portion of your income will help you stay on track. This discipline will help you navigate through any financial challenges that arises without disturbing your investments.
By maintaining a long-term perspective and resisting the urge to withdraw from your investments prematurely, you can work towards achieving financial stability and growth. The journey requires patience and commitment, but with consistent effort and disciplined investment practices, you can steadily progress toward your financial goals.
Your interest in career
I developed an interest in shares while I was still in school. The first time I heard about it, I researched online, started reading books, and began buying shares. This process helped me gain the knowledge and information needed to become the leader of the association. The most rewarding aspect for me is seeing my progress. The peace of mind and financial freedom that come with it are incredibly fulfilling.
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