Protection of investors should be a policy imperative, says Yusuf

A call has been made for the protection of investors, entreprenuers and as well as employers of labour in the country. The Chief executive Officer, Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, said this much in a position paper on “Protecting investors and employers: A national policy imperative” made available to The Nation, yesterday.

Yusuf, an economist, noted that while investors, entrepreneurs, and employers are the lifeblood of every modern economy, as they take risks, mobilise capital, create jobs, generate tax revenues, and drive innovation, but in Nigeria, their rights and investments remain inadequately protected.

Noting that the labour unions play a legitimate role in protecting workers, he nonetheless insisted that their activities must align with the law and national interest. Reforms in this aspect should include proportionality of industrial actions; designation of strategic sectors- including energy, health, transport, and ICT, as essential services, where strikes are restricted or prohibited; introduction of compulsory arbitration in essential sectors to prevent economic paralysis; clear sanctions and restitution requirements for unlawful strikes that inflict damage on businesses and the economy.

“Labour rights should end where those of employers begin. Investors should have as much rights to protect their investment as labour unions have the rights to protect the workers. There is a need for a fair and equitable balance. Mandatory publication of audited union accounts and governance records to enhance transparency,” Yusuf said.

According to him, while significant legal safeguards exist for workers and employees, there is no comprehensive framework that protects the interests of investors and employers. “This imbalance undermines investor confidence and leaves those who create jobs vulnerable to disruptions- particularly from industrial actions by labour unions. The real sector is especially exposed, given its large workforce, high fixed costs, and significant sunk investments. There are worries as well about the seemingly unlimited powers of regulatory institutions,” Dr. Yusuf said.

He therefore muted that a robust policy response that creates a fair, predictable, and secure investment climate; protects those who create jobs; and ensures that industrial relations are governed by law, due process, and mutual respect, has therefore become imperative.

“Protecting investors and employers is not a privilege, it is a national economic imperative. Without them, there can be no sustained growth, no employment, and no national prosperity. Nigeria must, therefore, urgently institutionalise a fair, secure, and predictable business environment that protects those who take risks to create wealth. This is not about weakening labour unions, but about balancing rights and responsibilities, to foster sustainable economic growth, social stability, and national security,” he argued.

Yusuf argued that investors in the country operate in an environment marked by uncertainty and institutional weakness. He noted key sources of vulnerability to include a of comprehensive legislation guaranteeing the rights of investors or shielding them from harassment, arbitrary regulatory decisions, or unlawful shutdowns; unrestrained union actions follow arising from a growing culture of coercion, intimidation and impunity among labour unions, resulting in industrial actions that are often out of proportion, which frequently escalate into large-scale disruptions that paralyse production, inflict huge financial losses and undermine national economic stability.

The CPPE boss also noted the role of regulatory unpredictability, arising from frequent policy reversals, inconsistent enforcement and opaque regulatory processes which raise business risks and discourage long-term investments; bureaucratic bottlenecks and weak dispute resolution which stems from cumbersome procedures, unauthorised enforcement actions and protracted legal disputes that create delays and uncertainty, undermining investor confidence and productivity. He noted that these factors erode Nigeria’s competitiveness, deter both local and foreign investment and slow economic growth and job creation.

Yusuf also said that these have not been without its economic and social consequences. For instance, investor vulnerability, he explained, carries serious macroeconomic and social consequences.

“When investors lose confidence, capital flight intensifies, foreign direct investment declines, and domestic enterprises contract their operations. The resulting chain reaction includes job losses, declining tax revenues, and reduced economic growth.

“Unrestrained strikes in strategic sectors such as energy, transport, and health disrupt production, threaten national security, and endanger public welfare. Policy inconsistency and regulatory arbitrariness make long-term planning difficult, deepening Nigeria’s dependence on imports and weakening its industrial base.

“Without corrective reforms, these trends will continue to erode national competitiveness, discourage innovation, and diminish Nigeria’s economic resilience,” he said.

The CPPE therefore mulls new investor and employer protection framework that will establish a fair, balanced, and predictable environment for business. Specifically, the Group noted that this new policy objective should protect investors and employers from arbitrary actions by regulators, labour unions, and government agencies; rebalance industrial relations to ensure fairness and due process for all parties; safeguard strategic sectors of the economy from disruptions that threaten national stability; promote regulatory and policy stability to reduce uncertainty and enhance competitiveness and ensure accountability and enforcement of laws by unions, regulators, and employers alike.

Specifically, it said the country should enact a dedicated Investor and Employer Protection Act to provide a strong legal foundation for safeguarding investors’ rights. The Act should, it said, should codify the rights and obligations of investors, employers, regulators, and unions; prohibit unlawful actions such as intimidation, coercion, unauthorised shutdowns, and harassment; establish penalties, damages, and restitution mechanisms for violations.

“The Industrial Arbitration Panel (IAP) should be strengthened for faster, impartial resolution of industrial disputes. An Independent Investment Ombudsman Office should also be created to handle investor complaints and mediate disputes involving government agencies,” the CPPE boss said.