Egypt's FRA Mandates Carbon Emission Disclosure and Offsetting for Non-Banking Financial Firms
Egypt's Financial Regulatory Authority (FRA) requires large non-banking financial companies to disclose their carbon emissions and offset 20% by purchasing carbon credits. This regulation, effective after publication in the Official Gazette, aims to enhance ESG practices and transparency in the financial sector. Companies must report emissions under Scope 1 and Scope 2 standards annually, with compliance affecting operating licenses. The move is expected to stimulate demand in Egypt's voluntary carbon market, which currently has 170,000 carbon credits from 34 projects.
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Egypt's Financial Regulatory Authority (FRA) has mandated that large non-banking financial firms disclose their carbon emissions and offset 20% by purchasing certified carbon credits. This requirement, established under Decision No. 36 of 2026, applies to companies with issued capital over EGP 100 million and is designed to enhance environmental, social, and governance (ESG) practices.
Firms must prepare annual carbon footprint reports detailing Scope 1 and Scope 2 emissions, verified by accredited bodies. Reports are due by June 2026, with offsets required within 90 days. Compliance is necessary for operating licenses. The decision aims to boost Egypt's regulated voluntary carbon market.
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