The Chairman of the Senate Committee on Capital Market and Institutions, Senator Osita Izunaso, has called for continuous legislative review of Nigeria’s capital market laws, saying regular reforms are essential to deepen the market, strengthen investor confidence and drive the country’s long-term economic growth.
Izunaso made the call in a paper titled “Legislative Leadership and Capital Market Development in Nigeria: Strengthening the Legal Framework for Economic Transformation,” delivered at the
16th Capital Market Academics of Nigeria Fellowship Inaugural Lecture.
The lecture held on Saturday was chaired by the CMAN President, Prof Uche Uwaleke.
In his paper, the senator argued that an efficient capital market cannot thrive without a dynamic legal framework capable of responding to emerging financial innovations and global market trends.
According to the senator, while regulators and market operators play crucial roles in supervising the securities market, the National Assembly remains central to its growth through law-making, oversight, budgetary support and periodic reforms.
He said the enactment of the Investments and Securities Act (ISA) 2025 marked a major milestone in the evolution of Nigeria’s capital market, describing it as the most comprehensive reform of the country’s securities legislation in nearly two decades.
“The Legislature occupies a uniquely strategic position. While regulatory institutions are responsible for market supervision and enforcement, their powers, mandates and institutional effectiveness derive from legislation enacted by the National Assembly,” Izunaso said.
He added, “The enactment of the Investments and Securities Act 2025 provides compelling evidence of the Legislature’s pivotal role in shaping the future of Nigeria’s capital market.”
According to him, the new law strengthens investor protection, expands the enforcement powers of the Securities and Exchange Commission (SEC), recognises digital assets and virtual asset service providers, provides a legal framework for financial market infrastructures and enhances market integrity through stronger enforcement mechanisms.
Izunaso noted that these reforms position Nigeria’s securities market to align more closely with international regulatory standards while improving its attractiveness to both domestic and foreign investors.
He, however, stressed that the passage of the ISA 2025 should not be regarded as the final phase of capital market reforms.
“Capital market legislation must remain dynamic. Unlike many areas of law, capital market regulation must continuously evolve to accommodate financial innovation, respond to systemic risks and align domestic markets with international standards,” he stated.
The senator warned that rapid technological developments, including artificial intelligence, blockchain technology, digital assets, algorithmic trading and decentralised finance, are creating new regulatory challenges that require proactive legislative responses.
He also identified cybersecurity, sustainable finance, tokenised securities and cross-border digital investments as emerging issues that lawmakers must continuously address to safeguard market integrity.
Izunaso explained that beyond passing legislation, the National Assembly has an important oversight responsibility to ensure that regulatory institutions effectively implement existing laws.
According to him, regular engagement with the SEC, Nigerian Exchange Group, Central Securities Clearing System, Investments and Securities Tribunal and other market institutions would help identify implementation gaps, improve regulatory effectiveness and strengthen public confidence in the market.
“Constructive oversight strengthens regulatory credibility by encouraging transparency, accountability and institutional performance,” he said.
The senator further argued that investor confidence remains the lifeblood of every successful capital market, noting that investors are more willing to commit long-term capital where laws are clear, enforcement is effective and regulatory institutions operate independently.
He said legislative support for stronger corporate governance, transparent disclosures, beneficial ownership reporting and tougher sanctions against insider trading and market manipulation would further enhance Nigeria’s investment climate.
Izunaso also called for policies that would broaden domestic participation in the capital market, particularly among youths, women, small and medium-sized enterprises and Nigerians in the diaspora.
He noted that despite the growth of institutional investors, retail investor participation remains relatively low due to limited financial literacy, inadequate awareness and lingering concerns arising from previous market volatility.
According to him, expanding investor education and consumer protection initiatives would improve market resilience and reduce dependence on foreign portfolio investments.
The senator maintained that Nigeria’s capital market should increasingly serve as a strategic platform for financing infrastructure, housing, renewable energy, manufacturing, agriculture, healthcare and other critical sectors of the economy.
“As public resources become increasingly constrained, private capital mobilised through efficient capital markets will become indispensable for achieving Nigeria’s development objectives,” he said.
Drawing lessons from the United States, India and South Africa, Izunaso said countries with globally competitive capital markets have consistently relied on responsive legislation, strong regulatory institutions and continuous legal reforms to sustain investor confidence.
He observed that successful jurisdictions regularly update their securities laws to reflect technological innovation and changing market realities, while ensuring that regulators are adequately empowered and accountable.
To sustain the momentum created by the ISA 2025, Izunaso recommended that the National Assembly institutionalise periodic reviews of capital market legislation, strengthen oversight of regulatory agencies and support the timely development of subsidiary regulations needed for the implementation of the new law.
He also urged lawmakers to promote financial literacy, strengthen investor protection, encourage innovation and support policies that would facilitate infrastructure financing, sustainable investment and regional capital market integration under the African Continental Free Trade Area.
“The enactment of the Investments and Securities Act 2025 has provided a modern legal foundation, but its enduring success will depend upon sustained legislative commitment to innovation, effective oversight, institutional strengthening and policy consistency,” Izunaso said.
He added that with consistent legislative support, Nigeria’s capital market would be better positioned to mobilise long-term investment, support private sector development and serve as a catalyst for inclusive and sustainable economic transformation.
