By Enam Obiosio

The National Association of Securities Dealers (NASD) Plc – which operates Nigeria’s over-the-counter (OTC) market – sits at a critical intersection between private capital, unlisted companies, and market transparency.

Below is a comprehensive and intellectual discussion titled: ‘Integrating Investor Relations into Holistic NASD Operations in Nigeria.’

In the evolving landscape of Nigeria’s capital markets, the National Association of Securities Dealers (NASD) Plc has emerged as a quiet but powerful driver of financial inclusion and corporate transparency. Originally conceived to provide liquidity and visibility to unlisted public companies, NASD today represents the transitional bridge between the private enterprise economy and the formal capital market ecosystem.

Yet, as Nigeria’s investment architecture matures – particularly under the current wave of regulatory modernization, tax reforms, and MSME inclusion initiatives – there is a pressing need to embed Investor Relations (IR) as a core discipline within NASD’s operational framework.

This is not simply about compliance; it is about market credibility, communication clarity, and capital confidence.

The Strategic Role of NASD in Nigeria’s Market Evolution

NASD’s significance lies in its alternative market positioning – serving enterprises not yet listed on the Nigerian Exchange (NGX), but with the potential, scale, and structure to attract private or institutional investment. Through its platform, unlisted companies can trade their securities transparently, comply with disclosure standards, and access liquidity.

Over the years, NASD has helped to formalize private capital transactions, bringing together issuers, brokers, fund managers, and investors under a regulated but flexible structure.

However, while NASD provides the infrastructure for trading and transparency, the narrative architecture – how companies communicate with investors, interpret data, manage perceptions, and build trust – remains underdeveloped.

That is the function of Investor Relations (IR) – a professional and strategic communication framework that connects company performance with market perception and investor sentiment.

Why Investor Relations Belongs at the Heart of NASD Operations

The integration of IR into NASD’s framework should be viewed as an evolutionary next step, for several compelling reasons:

• Enhancing Disclosure Discipline

Investor relations strengthens disclosure practices beyond regulatory filings. It ensures that companies trading on NASD’s platform understand how to present, interpret, and communicate their results – not merely submit them.

An IR-embedded NASD will encourage its listed entities to issue quarterly updates, governance statements, and investment briefs that build confidence and signal maturity to potential investors.

• Deepening Market Intelligence and Transparency

Through investor relations mechanisms, NASD can institutionalize a culture of two-way communication – not just between issuers and investors, but also between regulators, intermediaries, and the investing public.

This will help NASD move from being a transactional platform to a relationship-driven market ecosystem, guided by trust and informed dialogue.

• Strengthening Investor Education and Protection

Unlisted securities markets attract a diverse range of investors, many of whom may not fully understand private equity risks. Embedding IR principles in NASD’s ecosystem ensures that information asymmetry is reduced, expectations are managed, and market discipline replaces speculative behavior.

• Attracting Institutional and Foreign Investors

Institutional investors require transparency, governance, and credible disclosure before committing funds. By adopting a robust investor relations culture, NASD can signal market maturity, attract diaspora capital, and serve as a preparatory stage for companies eyeing future listings on the NGX or other exchanges.

The Investor Relations Integration Framework for NASD

To institutionalize IR within NASD operations, a three-layer integration model can be adopted:

Layer 1: Regulatory and Governance Integration

NASD can incorporate IR compliance as part of its listing and post-listing requirements.
This means that every company trading on NASD would:

• Maintain an Investor Relations Contact/Desk;
• Issue regular disclosure summaries (quarterly or semi-annual);
• Provide corporate governance reports and management commentaries on performance;
• Adhere to market communication protocols that align with SEC guidelines.

Such integration transforms disclosure from a procedural requirement into a strategic trust-building process.

Layer 2: Market Education and Capacity Building

NASD can establish an Investor Relations and Disclosure Academy, in collaboration with the Chartered Institute of Stockbrokers (CIS), SEC, and IR Society of Nigeria (IRSN).

This academy would train company executives, compliance officers, and market intermediaries on:

• Crafting investor-ready communication;
• Handling material information;
• Managing corporate reputation in the investment community;
• Utilizing digital channels for investor engagement.

By doing so, NASD would become not only a market operator but a knowledge institution, shaping corporate governance standards in Nigeria’s private market.

Layer 3: Technology and Communication Integration

NASD’s platform can host a centralized digital IR portal – an interactive database where investors can access verified company profiles, financial statements, IR updates, and corporate announcements.

Such transparency will significantly increase investor confidence, reduce information gaps, and facilitate informed decision-making.

The MSME and Private Equity Dimension

As Nigeria seeks to formalize MSMEs and channel private equity into productive ventures, NASD’s OTC platform is uniquely positioned to host growth-stage enterprises transitioning from informal financing to structured capital markets.

However, without IR, these MSMEs may not meet the disclosure and governance expectations of serious investors.

Integrating IR at the NASD level will thus help:

• Prepare MSMEs for eventual listing;
• Protect retail investors from opaque offers;
• Build a pipeline of compliant, well-structured companies ready for capital market participation.

Essentially, IR becomes the ‘bridge of credibility’ that connects Nigeria’s entrepreneurial base to its capital base.

Aligning IR Integration with National Economic Priorities

Nigeria’s Fiscal and Tax Reforms (2025), SME formalization drive, and SEC-SMEDAN MoU on capital access all converge on a common goal – to make Nigeria’s business environment transparent, inclusive, and investment-ready.

NASD, as a secondary trading platform, must therefore align its operational strategy with this national reform trajectory.

By embedding IR, NASD helps:

• Translate fiscal and regulatory policies into market narratives;
• Reinforce the SEC’s disclosure standards at the grassroots of the market;
• Promote Nigeria as a destination for ethical, compliant, and transparent private capital.

From OTC to National Capital Confidence: The Way Forward

To make investor relations an organic part of NASD’s DNA, a few strategic actions are recommended:

1. Institutionalize a NASD Investor Relations Framework – establishing IR guidelines for all issuers and market participants.
2. Create an Annual NASD Investor Relations Scorecard – publicly ranking companies on disclosure, governance, and transparency.
3. Launch the ‘NASD Capital Confidence Forum’ – an annual engagement platform bringing together issuers, investors, regulators, and IR professionals.
4. Collaborate with the SEC and NGX on Cross-Market Governance Standards – ensuring consistent messaging and investor protection across all trading platforms.
5. Incentivize IR Adoption – e.g., lower listing fees or visibility benefits for companies that maintain certified IR functions.

Building Nigeria’s Market Integrity Through IR

The integration of investor relations into NASD operations is not a technical add-on; it is a strategic imperative.

For a developing market like Nigeria, where information asymmetry remains high and investor trust often fragile, IR provides the credibility layer that sustains market growth.

A NASD with IR at its core will not only deepen market depth and liquidity but also reshape Nigeria’s private investment culture – from transactional opportunism to sustained trust, disclosure, and shared prosperity.

In the era of fiscal reform and MSME inclusion, Investor Relations must become Nigeria’s next capital infrastructure. NASD is perfectly placed to lead that transformation.