Egypt has introduced a groundbreaking climate accountability regulation requiring non-bank financial institutions (NBFIs) above a defined capital threshold to measure, disclose, and partially offset their greenhouse gas emissions.

Under Decision No. 36 of 2026 issued by the Financial Regulatory Authority (FRA), non-bank financial institutions with issued capital or net equity exceeding EGP 100 million (≈ $2.2 million) must annually calculate and disclose their carbon footprint. This includes Scope 1 emissions from direct operations and vehicles and Scope 2 emissions from purchased energy, with reports verified by accredited bodies and submitted to regulators.

Beyond disclosure, the regulation obliges these institutions to offset at least 20 % of their reported emissions each year through regulated carbon credits sourced from Egypt’s voluntary carbon market. Compliance is tied directly to the ability to maintain operating licenses, embedding climate risk management into financial oversight and supervision.

This policy marks a significant shift in Egypt’s sustainable finance landscape, aligning financial sector regulation with environmental stewardship goals and strengthening emerging carbon market infrastructure. Proponents argue it will drive demand for domestic carbon credits and accelerate integration of climate criteria into financial decision-making. Critics note the challenges institutions may face in emission measurement and compliance implementation, especially with tight deadlines and verification requirements.