Embrace Tech, ESG In Audit Practices, Bank Auditors Urged

Industry leaders have called for a major shift in audit practices in Nigeria’s banking sector, emphasising the need for technology integration, cybersecurity, and environmental, social, and governance (ESG) considerations

They made this call at the Annual Retreat/Conference and General Meeting of Association of Chief Audit Executives of Banks in Nigeria (ACAEBIN) held in Lagos, where experts highlighted how rapid digital transformation, evolving regulatory demands, and sustainability concerns are reshaping the role of internal auditors.

The chairperson of ACAEBIN, Aina Amah said, the increasing pace of digital innovation and cyber threats informed the theme of the conference.

“In the last two to three years, digital innovation has grown significantly, but with it comes increased cyber risk. This is the time for auditors to take decisive steps to mitigate those risks,” she said.

Amah warned that failure to act proactively could allow malicious actors to undermine technological progress, stressing that institutions must strengthen their cybersecurity frameworks through continuous monitoring, vulnerability assessments, and penetration testing.

She also underscored the importance of ESG, noting that organisations must move beyond profit making to address environmental and social risks.

“ESG is no longer optional. The realities of climate change and environmental degradation mean organisations must act responsibly to ensure long term sustainability,” she said.

She added that auditors must evolve from traditional compliance roles to strategic advisors who anticipate and prevent risks before they materialise, rather than simply reporting failures after the fact.

Also speaking, partner, risk advisory at Deloitte Nigeria, Mrs Ibukun Beecroft emphasised the urgency of integrating ESG into audit processes, particularly as global investors and regulators demand greater transparency in sustainability reporting.

Beecroft noted that ESG has evolved into a financial, regulatory and governance issue for banks, requiring stronger oversight and structured reporting frameworks.

She highlighted emerging disclosure requirements, including IFRS S1 and S2 standards, and stressed the need for auditors to ensure the integrity, reliability and completeness of ESG data used for decision-making.

The associate director, technology risk at KPMG Africa, Chukwuemeke Igabari called for the development of ‘future-ready’ internal audit functions capable of delivering strategic value in an increasingly digital environment.

Igabari said banking operations have become more complex due to digitalisation, new compliance requirements, and emerging risks such as cybersecurity threats, data privacy concerns, and artificial intelligence driven processes.

“There is no effective internal audit function today without a strong technology backbone. Auditors must leverage data, automation and advanced analytics to remain relevant,” he said.

He noted that a growing proportion of fraud losses now occur through digital channels, warning that institutions must adopt real-time auditing and continuous monitoring to detect and respond to threats promptly.

Igabari cited incidents of control failures, including cases where large sums were erroneously credited to customer accounts and remained undetected for months, as evidence of gaps in internal controls.

He stressed that internal auditors must move beyond traditional ‘tick box’ compliance approaches to become proactive, insight-driven partners within their organisations.

“We must transition from being assurance providers to becoming trusted advisors who deliver insight, foresight and value driven risk perspectives,” he said.