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Arab Finance: The Financial Regulatory Authority (FRA) has mandated that non-banking financial companies with issued capital or net equity exceeding EGP 100 million disclose their carbon emissions and offset part of them, as per a statement.
Companies subject to the decision must prepare an annual carbon footprint report covering emissions generated by their operations.
The report must detail emissions in line with Scope 1 and Scope 2 standards, which measure direct emissions such as fuel combustion and company-owned vehicles, as well as indirect emissions, including electricity consumption and heating or cooling used in company facilities.
The move is aimed at strengthening environmental and social governance and addressing climate-related financial risks.
The FRA defined the carbon footprint as the total greenhouse gas emissions resulting from an institution’s activities, measured annually in tons of carbon dioxide equivalent.
All reported data must be reviewed and verified by accredited verification and certification bodies.
Companies are required to submit their first reports to the FRA by the end of June 2026, with subsequent reports due annually at the end of each company’s fiscal year.
Within 90 days of submitting the report, firms must offset around 20% of their declared emissions by purchasing carbon emission reduction certificates registered in the Authority’s regulated voluntary carbon market.
The FRA stated that meeting these requirements will be a condition for the continued licensing of companies covered by the decision.
The resolution will take effect the day after its publication in the Official Gazette and on the authority’s website.
The FRA expects the move to provide a boost to Egypt’s regulated voluntary carbon market by increasing demand for carbon certificates.
The market currently includes 170,000 certificates issued by 34 registered projects and is supported by eight accredited verification and certification bodies.
