A Chair in Business Ethics at the University of Lagos, Prof. Kenneth Amaeshi, has urged governments and policymakers to accord greater recognition to the informal sector, describing it as the primary engine driving job creation and economic growth in Nigeria.
Amaeshi made the call on Thursday while delivering the inaugural lecture at the FirstBank Samuel Asabia Professorial Chair in Business Ethics Public Lecture, held at the George Ade Ajayi Auditorium, UNILAG, titled Ethical Paradoxes, Small Businesses, and the Informal Economy: Lessons for Tax Compliance and Accountability.
He noted that while large corporate entities like banks and capital market firms dominate public attention and receive government bailouts during crises, they account for only a tiny fraction of direct employment compared with the micro-enterprises that make up the everyday economy.
“Informal sector key for job creation, economic growth,” Amaeshi stated, emphasising that the taken-for-granted invisible economy of ordinary citizens forms the true majority economy where most Nigerians earn their livelihood. He explained that despite the glamour of large businesses and their ability to generate massive wealth, their capacity to create direct employment opportunities remains significantly lower than that of small businesses operating across urban and rural communities.
“If you take First Bank for example, First Bank has about 30,000 employees directly, or between 50,000 and 60,000. So there are about 30 banks in Nigeria. If you assign all of them the same number of employees like First Bank, we are looking at about 600,000 direct jobs. But we have about 200 million people in Nigeria, and if the banks are only employing about 600,000, then you can imagine where most of us are,” Amaeshi said.
The Don noted that while formalisation of the informal economy is a welcome development that could help small enterprises access finance, technical assistance, and structured support systems, attempts to homogenise the sector through rigid taxation often create severe friction. He stressed that small business owners are not inherently opposed to contributing to national development, but they are often discouraged by the perceived lack of transparency and accountability regarding how tax revenues are utilised by government authorities.
“Nigerians do not actually hate tax. Most of the small business owners are cognisant of their tax responsibilities, but taxpayers’ concerns about how taxes are used point to one thing: tax accountability matters. If you want more money from us, show us how you spend money,” Amaeshi said.
Speaking earlier in his welcome address, the Managing Director and Chief Executive Officer of FirstBank Group, Mr. Olusegun Alebiosu, stated that the informal sector contributes approximately 42.5 per cent to Nigeria’s Gross Domestic Product, according to National Bureau of Statistics data, serving as the primary source of livelihood for millions of households.
Alebiosu noted that the sector operates largely on personal trust and reputation rather than formal regulatory frameworks, making it essential to address the paradox of promoting ethical conduct without placing undue sustainability burdens on struggling small enterprises.
“The informal sector provides livelihoods, employment and entrepreneurial opportunities for millions of Nigerians. From traders and artisans to farmers and small business owners, these enterprises are an important part of our economic ecosystem. Yet, many operate within challenging environments characterised by limited access to finance, infrastructure, capacity and formal business structures. Despite this, the sector contributes significantly to Nigeria’s gross domestic product and remains, for many households, the first and sometimes only source of income,” Alebiosu stated.
“At FirstBank, we believe that ethics and sustainability should not be viewed as competing priorities but rather that ethical business is sustainable business. Integrity builds trust. Transparency strengthens relationships. Responsible practices enhance resilience. And businesses that earn the confidence of their customers, employees, partners and financial institutions are better positioned to grow,” he added.
The FirstBank chief executive highlighted that the Samuel Asabia Chair is one of ten permanently restricted endowments funded by the financial institution across federal universities in Nigeria’s six geopolitical zones to drive academic research and build ethical leadership. He emphasised that the scholarship produced under the Chair must extend beyond corporate boardrooms to benefit market stalls, workshops, and agricultural enterprises across the informal economy.
Expressing the appreciation of the institution, the Vice Chancellor of the University of Lagos, Prof. Folasade Ogunsola, represented by the Deputy Vice Chancellor, Prof. Mathew Ilori, commended FirstBank for its steadfast commitment to academic excellence and ethical leadership through the endowment initiative.
She noted that the university community remained deeply grateful for the financial institution’s enduring partnership, which continues to foster robust research, intellectual discourse, and societal development.
The Vice Chancellor further reaffirmed the university’s total support for the FirstBank Samuel Asabia Professorial Chair in Business Ethics, assuring that UNILAG would continue to provide the enabling academic environment required to maximise the impact of the endowment. She expressed confidence that the insights generated through the Chair’s public lectures and research outputs would yield actionable solutions to advance ethical standards across both the formal and informal sectors of the Nigerian economy.
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