ESG 2025 Comparisons

On the environmental front, Egypt rolled out the first regulated voluntary carbon market (VCM) in Africa, complete with trading rules, verification bodies, carbon registries and emission credit instruments. The launch came in early 2025 through a statement made by the Minister of Planning and Economic Development (MOPED).

A further step in implementing a circular sustainable economy took place in 2025, with the introduction of the Extended Producer Responsibility for plastic bags producers, among other amendments to the waste management regulations that took place this year, adding clarity and enforcement to the legal framework and its implementation.

On the social front, 2025 has seen significant developments to the legal framework of social matters, following the introduction of a new labour law strengthening worker protections and rights through clearer contracts and recognition of flexible work, alongside the enactment of a new social security law.

On the governance front, recent years have seen steady progress through strengthened corporate governance regulations, enhanced disclosure requirements, and increased oversight by regulatory authorities such as the Egyptian Stock Exchange and the Financial Regulatory Authority, which work alongside each other.

Egypt has recently advanced its environmental and sustainability framework through several legal reforms. A major step was the creation of a VCM under Prime Ministerial Decree No 4664 of 2022, later strengthened by FRA Decree No 279 of 2024 and FRA Decree No 70 of 2025, which revised the composition of the Carbon Credit Regulatory Committee. In January 2025, the Cabinet’s State Information and Decision Support Centre also issued a general report on the role of carbon markets.

On waste and plastics, Prime Ministerial Decree No 662 of 2025 introduced an Extended Producer Responsibility system for plastic shopping bags, requiring registration, quarterly reporting and payment of EGP37.5 per kg sold to the Waste Management Regulatory Authority (WMRA). In addition, Decree No 150 of 2025 and Decrees No 1113 and 1114 of 2024 amended the Waste Management Law No 202 of 2020 and its Executive Regulations, clarifying landfill rules, hazardous waste fees, and integrated waste management services.

In the energy sector, Law No 2 of 2024 on green hydrogen introduced tax and VAT exemptions, complemented by Cabinet Decree No 54 of 2023 on land usufruct for renewable projects. EgyptERA Circular No 2 of 2024 enabled private-to-private electricity trading under Electricity Law No 87 of 2015. Finally, Presidential Decree No 67 of 2023 amended customs tariffs for electric vehicles (EVs), while Ministerial Decree No 101 of 2025 set new EV charging tariffs.

In the social sphere, the enactment of the new labour laws marks a significant milestone. However, the implementation of these laws is still in its early stages, and there has not yet been sufficient time for the courts to develop a body of case law.

New Labour Law No 14 of 2025

Law No 14 of 2025 (the “New Labour Law”), issued on 3 May 2025 and entering into force in September 2025, repealed the old labour law (No 12 of 2003) and introduced many new developments on the social front. For instance, the law:

• introduces strict provisions against sexual harassment, bullying and workplace violence, and mandates clear mechanisms and disciplinary actions;
• promotes gender-equality by ensuring equal pay to male and female workers;
• increases rights to sick leave, maternity leave and childcare leave;
• regulates paternity leave for the first time; and
• emphasises the obligations on the employer in relation to health and safety specifications of employees and inspections.

The new law also clarified previously regulated points to avoid ambiguities and introduced business flexibility on the procedures and grounds of termination, institutionalised permanent employment, inclusion of marginalised persons (persons with disabilities and informal workers) and recognises modern work models (such as remote work and platform-based work).

The new law expands and clarifies previously regulated obligations regarding workplace health and safety. Establishments must assess potential natural, industrial and operational risks, develop and regularly test emergency response plans, and train workers accordingly. Employers are responsible for maintaining a safe work environment in line with exposure standards and threshold limits, and must implement precautionary measures to protect employees from physical, engineering, biological, chemical and indirect hazards.

Takaful and Karama (Solidarity and Dignity)

Law No 12 of 2025, promulgating the Social Security Law issued on 3 April 2025, repeals the previous Law No 137 of 2010 on social security. The new Social Security Law is rooted in delivering inclusive social uplifting to Egyptians not covered by any social insurance system and who are unable to support themselves or their families, particularly in cases of disability or old age and residents of other countries residing in Egypt.

The law established the two main programmes “Takaful” and “Karama” (Solidarity and Dignity) and the Takaful and Karama Fund to replace the Central Social Security Fund established under the previous law. The Social Security Law establishes the criteria of eligibility for the Takaful (conditional financial support) and Karama (unconditional financial support) programmes, the procedures for application and the cases for suspension.

Financial Regulatory Authority (FRA) Reporting and Disclosure Obligations

The FRA implements an ESG reporting framework, mandating ESG disclosures for non-bank financial institutions (NBFIs) and Egyptian Exchange (EGX) listed companies from 2023 onwards.

In 2021, the FRA’s board of directors issued two decrees, No 107 and No 108 of 2021, introducing clear reporting guidelines that incorporate ESG considerations, along with the Task Force on Climate-Related Financial Disclosures (TCFD) framework. These guidelines serve as a foundational reference for companies in disclosing their sustainability practices and climate-related financial risks.

FRA Decree No 107 of 2021 requires non-banking financial institutions (NBFIs) with issued capital or net equity of at least EGP100 million to include ESG disclosures in their annual reports, which must be submitted alongside their annual financial statements. Institutions with issued capital or net equity of EGP500 million or more are further obligated to comply with both ESG and TCFD requirements in their annual reporting.

FRA Decree No 108 of 2021 extends these requirements to all companies listed on the EGX, mandating the disclosure of ESG information as well as the financial impacts of climate change within their annual reports and financial statements.

Furthermore, the FRA advanced alignment with the two sustainability disclosure standards IFRS S1 and IFRS S2 (as issued by the International Sustainability Standards Board) to further modernise sustainability reporting by 2025.

ESG standards are not governed by a single, unified law; they are distributed across different statutory, regulatory and voluntary frameworks depending on the jurisdiction and sector. Consequently, the relevant regulator in each sector is competent for overseeing and ensuring the application of these standards.

For example, the Egyptian Environmental Affairs Agency (EEAA) – the main authority in the environmental sector regulating the protection of the environment vis-à-vis corporations – together with the Ministry of Environment undertakes all environmental oversight. In the social sphere, the competent labour authority under the Ministry of Manpower would be the relevant authority. The FRA is a principal driver in implementing ESG and TCFD disclosure requirements, carbon credit registries and VCM frameworks. Finally, the Central Bank of Egypt (CBE) ensures sustainable finance discipline in banking via its Guiding Principles and mandatory sustainability compliance.

Moving forward, the sectors that would likely be most impacted include:

• infrastructure and energy – climate investments, green finance and low carbon project support continue to expand in Egypt;
• the financial sector – banks and NBFIs face ESG disclosure, sustainable lending, and climate risk integration regimes; and
• capital markets – ES and ESG bond issuance, carbon trading and investor scrutiny will impact issuers and fund structures.

While the progress of ESG implementation in Egypt is increasingly driven by legal and regulatory developments at both the domestic and international levels, it is also supported by the State’s political commitment to advancing the ESG agenda.

Regional challenges – most notably, water security concerns related to the Nile and the Grand Ethiopian Renaissance Dam – coupled with wider instability and global energy shocks compel the State to prioritise energy security, with a continued emphasis on natural gas.

Through initiatives such as Egypt Vision 2030 and the National Climate Change Strategy 2050, the government has established a comprehensive framework for sustainable development and climate action, thereby reinforcing the political legitimacy of ESG-aligned reforms.

Alignment With International Sustainability Disclosure Standards

In the upcoming phase, the FRA intends to further align with the two sustainability disclosure standards IFRS S1 and IFRS S2 (as issued by the International Sustainability Standards Board) to further modernise sustainability reporting by 2025. In early 2025, the FRA’s chairman stated that the FRA is currently developing a new framework in alignment with the latest international standards (particularly, IFRS S1 addressing the general requirements for disclosing sustainability-related financial information, and IFRS S2, which covers climate-related disclosures).

EGX S&P/EGX ESG Index

In July 2025, the EGX announced the decommissioning of the Standard & Poor (S&P)/EGX ESG Index effective 15 July 2025. It further announced that it is currently considering the creation of a new ESG index with a revised methodology more aligned with international best practices.

General Overview of the Legal Framework

In Egypt, corporate governance is consolidated under several key laws and regulations. The Companies Law No 159 of 1981 (as amended) and its Executive Regulations remain the foundation, applying to joint stock companies, limited liability companies, partnerships limited by shares, and one-person companies. This framework is supplemented by the Investment Law No 72 of 2017 and related circulars issued by the General Authority for Investments (GAFI), notably Circulars No 19/2019, 20/2019 and 21/2019.

Companies offering non-banking financial services (NBFS), whether listed or not, are subject to stricter obligations due to oversight by the FRA. For listed companies, the Capital Market Law No 95 of 1992 (as amended) and its Executive Regulations apply, alongside the EGX Listing Rules (FRA Decree No 1 of 2020) and FRA Decrees No 100 of 2020, 107 of 2021, 108 of 2021 and 110 of 2021.

Listed Companies

Board composition and committees

The EGX Listing Rules (Article 37) require listed companies to establish an audit committee, comprising at least three non-executive directors, with a majority being independent, including the chair. Its role includes overseeing internal controls, reviewing audit reports and ensuring corrective measures. Under FRA Decree No 110 of 2020 (the “Unified NBFS Decree”), companies must also form a risk committee, which may be merged with the audit committee. A governance committee may also be created, though its tasks can be delegated to the audit committee. Furthermore, Article 18 of the EGX Listing Rules requires at least two independent directors.

Gender Inclusion

The EGX Listing Rules mandate female representation on boards, requiring women to hold at least 25% of board seats, with a minimum of two female directors. FRA Decree No 110 of 2021 extends this requirement to NBFS companies, listed or not. Disclosure obligations also cover gender pay equality and workplace anti-discrimination measures.

Disclosure and Transparency

Listed companies must submit quarterly financial statements to the FRA and EGX. Under FRA Decrees No 107 and 108 of 2021, annual ESG reports are mandatory, with additional TCFD-aligned climate disclosures required for entities with capital or equity above EGP500 million. Companies must also publish annual financial statements, explanatory notes and auditor’s reports in Arabic-language newspapers, on EGX trading screens and on their websites. They must disclose significant events such as related-party transactions or ownership changes.

Unlisted Companies

Unlisted companies are governed primarily by the Companies Law and GAFI circulars (notably Circular No 21/2019), which encourage – but do not mandate – best practices in governance. These include guidance on board structures, minority shareholder rights, digital filings, virtual meetings and secret voting.

Obligations for unlisted companies are less rigorous: they must prepare audited financial statements, comply with fiduciary duties of directors, follow rules on general assemblies and rights issues, and submit certain disclosures to GAFI. While the 2016 Corporate Governance Guidelines encourage greater alignment with international standards, binding rules largely remain confined to listed entities.

For listed companies, the role of directors has evolved to include increased oversight of ESG risk, integration of sustainable finance policies, compliance reporting, board diversity and risk governance.

Expanded Disclosure and Reporting Duties

Directors must now oversee the preparation of ESG and climate-related disclosures and quarterly progress reports, to be integrated in annual reports, with shareholder accountability via the annual general assembly.

Governance Enhancements

The FRA’s corporate governance rules for NBFS companies (under Decree No  100/2020) require detailed by-laws defining board competencies, ensuring board member time dedication and alignment with company and shareholder interests.

Board Composition

Directors must support implementation of the FRA’s diversity requirement – women must occupy at least 25% of board seats or there must be at least two female directors.

Risk Oversight

Although the Companies Law does not explicitly extend fiduciary duty to environmental or broader stakeholder interests, boards are expected to manage climate and ESG risks to the extent permitted by shareholder mandates. A risk committee is required to be established to oversee all types of risks under the FRA’s corporate governance rules for NBFS companies (under Decree No 100/2020).

As a general rule, non-profit entities usually register under Law No 149 of 2019, which regulates associations, civil institutions, unions, and regional or foreign non-governmental organisations (NGOs). It should be noted that any work that does not create or does not intend to create profit (such as social or civil work) cannot be organised under the form of a company.

Engagement and Transparency

All reports including ESG and climate disclosures must be presented to shareholders at the general assembly, fostering deeper engagement with corporate sustainability strategies and risk mitigation imperatives.

Minority Shareholders

Minority shareholders (of less than or equal to 5% capital) retain the right to suspend general assembly decisions that disadvantage them, signalling the importance of balance across shareholder groups.

The CBE has started integrating ESG factors within Egypt’s financial ecosystem. In 2022, the CBE joined the Network for Greening the Financial System (NGFS), which aims to enhance the banking sector’s involvement in environmental risk management and support green projects; thus, the CBE issued binding sustainable finance regulations that required banks to integrate sustainable finance into their credit and investment decision-making.

Egypt also saw continued efforts in the issuance of green bonds and sukuk. In 2020, Egypt became the first country in the MENA region to issue sovereign green bonds, raising USD750 million to fund environmentally beneficial public sector projects in transport, energy and water. The issuance was underpinned by Egypt’s Green Financing Framework, which set eligibility criteria and transparency standards for green bond proceeds and helped to establish a benchmark for subsequent ESG-labelled instruments in the market. Following this, in 2023 Egypt’s Ministry of Finance announced plans to issue new sukuk with a value of USD1.5 billion. Finally, the Ministry of Finance announced its intention to issue new sukuk and green bonds valued between EGP5 billion and EGP10 billion throughout the course of FY2024 and FY2025.

The CBE oversees the banking sector under the Banking Law No 194 of 2020 and its circulars, which regulate lending practices, collateral requirements, credit exposure limits, interest rate frameworks and risk management. In 2022, the CBE issued binding sustainable finance regulations requiring banks to integrate sustainability into credit and investment decision-making. In addition, the Capital Markets Law No 95 of 1992 and its Executive Regulations No 135 of 1993 govern securities issuance, trading, listing on the EGX and disclosure obligations. Oversight is carried out by the FRA, whose decrees are legally binding. FRA Decrees No 107 and 108 of 2021 further require listed companies and NBFIs above a set threshold to disclose their ESG activities quarterly.

Access to sustainable finance in Egypt is gradually improving. The government has taken important steps, including establishing a Sovereign Sustainable Financing Framework, updating the Green Financing Framework issued in 2020 and aligning national strategies such as Egypt Vision 2030 with climate and sustainability goals. The CBE has also issued binding sustainable finance regulations requiring banks to integrate environmental and social risk into lending and investment decisions, while the FRA has introduced guidelines for ESG disclosure and green bond issuance. These measures, together with private-sector initiatives such as sustainability bonds and programmes supporting micro, small and medium-sized enterprises (MSMEs), renewable energy and waste recycling, are expanding the availability of sustainable finance.

Despite this progress, smaller companies (particularly MSMEs) may face difficulty due to weaker collateral and technical capacity. Overall, sustainable finance in Egypt is accessible for large, well-structured projects with international backing, but remains more challenging and costly for smaller entities.

Egypt’s shift towards ESG standards is likely going to be gradual as such a shift raises several challenges around inclusivity and fairness.

First, the country continues to rely heavily on natural gas for both power generation and export revenues, leaving it vulnerable to stranded asset risks. If the global energy transition accelerates, investments in gas infrastructure could become under-utilised, with knock-on effects for fiscal stability and employment in gas-dependent regions.

Additionally, heavy industries such as cement, steel and fertilisers remain vital to the economy and to job creation, yet they are also among the most carbon-intensive sectors. As international capital increasingly favours low-carbon investments, these industries may face higher financing costs and limited access to global funding unless cleaner technologies are adopted. This dynamic places a disproportionate burden on companies with fewer resources to decarbonise, while also threatening employment in established sectors.

Finally, smaller enterprises, which form the backbone of Egypt’s private sector, also struggle with significant financing gaps. Even with new government initiatives to improve access to financial and non-financial support, many lack the capacity to meet detailed ESG disclosure or compliance requirements.

In short, Egypt’s transition will only be just and inclusive if ESG policies are designed to balance sustainability goals with economic realities, supporting key sectors, safeguarding jobs, and building capacity to ensure that no group is excluded.

Similar to numerous jurisdictions where ESG standards are developing, Egypt’s sustainable finance agenda faces limited data; the absence of a clear national taxonomy makes it difficult to define what counts as sustainable, creating risks of exaggerated claims or overly cautious labelling.

Another challenge is potential pushback from carbon-intensive sectors such as oil and gas, cement and steel, which remain vital for jobs and GDP. These industries may view ESG requirements as costly or threatening to competitiveness, leading to resistance or calls for exemptions. Although Egypt has not adopted explicit “anti-ESG” measures, political and economic pressures could slow regulatory progress.

Finally, compliance and liability risks are increasing. New disclosure requirements for listed and financial institutions demand greater transparency; however, without strict verification, both regulators and companies risk credibility gaps, penalties and higher costs of capital.

Egypt is witnessing a shift from soft law to binding regulation in the field of ESG and sustainability.

For many years, ESG considerations were addressed mainly through voluntary measures, such as the S&P/EGX ESG Index launched in 2010, and corporate governance codes issued by the Egyptian Institute of Directors and the EGX. These instruments encouraged transparency in ESG practices, aiming to enhance market value, though they lacked enforceable obligations.

In recent years, however, these soft law principles have been codified into binding requirements. The FRA issued Resolutions No 107 and 108 of 2021, making ESG and climate disclosures mandatory for listed companies and NBFIs above specific thresholds. The CBE also moved from its 2021 Guiding Principles for Sustainable Finance to binding regulations in 2022, obliging banks to establish sustainability units, integrate ESG risks into lending policies, and submit periodic reports. Similarly, Environmental Law No 4 of 1994 (as amended) reinforced environmental impact assessment (EIA) obligations, turning environmental due diligence into a legal prerequisite for licensing major projects.

This regulatory evolution, driven by Egypt Vision 2030 and international commitments, reflects the growing importance of ESG compliance for securing approvals, investor trust, and access to sustainable finance.

Due diligence in value chains is likely to increase in Egypt, particularly among larger and export-oriented companies and financial sector participants. Companies with more resources or exposure to international standards are ahead, while MSMEs and “upstream” suppliers are slower to follow. Egyptian exporters must meet stricter EU and US sustainability rules, while international investors and development banks increasingly require supply-chain transparency as a condition for financing.

While Egyptian law does not yet explicitly mandate supply chain due diligence, the FRA’s ESG disclosure requirements and the TCFD-based climate disclosures for larger listed companies effectively require companies to identify material ESG risks, which include risks stemming from suppliers and contractors. Similarly, the CBE’s Sustainable Finance Regulations (2022) oblige banks to assess environmental and social risks for projects they finance, and companies seeking credit must demonstrate compliance across all phases of the project, frequently including the performance of key subcontractors.

Suppliers are increasingly driven to align with ESG standards to remain eligible for contracts or financing opportunities. This is gradually driving a shift towards sustainable procurement and responsible investment practices in Egypt, mirroring international trends – even if not yet codified in a dedicated supply chain due diligence law such as the EU’s Corporate Sustainability Due Diligence Directive.

Statutory requirements relating to ESG matters have always been accounted for in M&A transactions in Egypt.

Regarding ESG-specific matters, larger or export-oriented firms as well as those dependent on international financing are more likely to be pushed into considering ESG in M&A due diligence. International investor expectations and access to sustainable finance make ESG a commercial necessity in many cases. Given the interest of private equity funds where Development Finance Institutions participate, most M&A transaction documentation and ESG sections detail the policies and procedures that such institutions would expect to see in portfolio investments where their funds are being utilised. For smaller, non-listed targets – especially MSMEs or local companies – ESG is less formalised in M&A deals. The cost and the lack of internal capacity or data mean that ESG due diligence may be limited or omitted.

In Egypt, ESG disclosure obligations vary according to company type, size and regulatory supervision.

Listed companies on the EGX are subject to FRA Resolution No 108/2021, which requires mandatory ESG and climate-related disclosures, supported by EGX guidance and reporting templates. Companies with larger issued capital or equity must also include climate-related financial disclosures in line with the TCFD framework in their annual reports.

NBFIs are governed by FRA Resolution No 107/2021. Entities with capital above a certain threshold must include ESG disclosures, while those above a higher threshold must additionally report climate-related financial risks following the TCFD framework.

Banks face obligations under Law No 194/2020 and subsequent CBE regulations. These include mandatory integration of sustainable finance policies, establishment of dedicated sustainability units, and periodic ESG reporting (semi-annual, quarterly and annual). Large projects financed by banks require environmental risk assessments by accredited consultants.

Joint stock companies and limited liability companies under the Companies Law and the Investment Law must submit financial statements and annual disclosures to GAFI, including investment data, employment, shareholder details and community contributions. Finally, under Environmental Law No 4/1994, projects must conduct EIAs, maintain environmental registers and comply with EEAA monitoring requirements.

It is worth noting that other regulations that are sector-dependent may add specific disclosure requirements, including ESG-related matters.

In Egypt, there is currently no explicit legal requirement mandating companies to publish transition plans or to commit to targets.

As a general principle, Consumer Protection Law No 181 of 2018 and its Executive Regulations, as well as Prime Ministerial Decree No 822 of 2019, forbid the supplier and advertiser from undertaking misleading advertising or making false claims. The law also requires suppliers to clearly inform consumers about product features, sources, trade marks and specifications.

The Executive Regulations of the Consumer Protection Law highlight that the supplier or advertiser is obliged to avoid any misleading conduct whenever such conduct relates to the awards, certificates or quality marks obtained by the product, good or service.

In addition to the above, the Waste Management Law No 202 of 2020 establishes a Green Label, administered by the Waste Management Regulatory Agency (WMRA) in co-operation with the Ministry of Trade and Industry. This Green Label is designed to incentivise manufacturers and product-producers to increase the proportion of recyclable inputs used in production and to reduce the generation of industrial waste.

The WMRA issues a “Green Label Certificate” to the owners of products, projects or manufacturers whose products meet the requirements and specifications set out in the Executive Regulations, in the form of the “Green Label Certificate” template provided by the WMRA.

At present, there is no published legal text or regulation that clearly establishes penalties or sanctions specifically for failing to obtain the Green Label or for using it incorrectly.

The main competent regulatory authorities in Egypt responsible for verifying ESG disclosure compliance and/or the use of sustainability marketing claims are:

• the FRA, which supervises capital markets, listed companies and NBFIs;
• the EGX, which oversees the disclosure compliance of listed companies;
• the CBE, which supervises banks and credit institutions under CBE Law No 194/2020;
• the Consumer Protection Agency, which enforces Consumer Protection Law No 181/2018; and
• the EEAA, which oversees EIA disclosure compliance.

Mandatory ESG Disclosures

While ESG disclosure is mandatory under FRA Decrees No 107 and 108 of 2021, the decrees themselves do not publicly specify penalties or sanctions for failure to make the required disclosures.

Nevertheless, issuers remain subject to the general enforcement powers of the FRA under the Capital Market Law No 95 of 1992 and its Executive Regulations. Article 65 bis of the Capital Market Law provides that failure to submit the financial statements, in accordance with the disclosure rules related thereto and the rules for listing and delisting securities as provided, may result in a fine of EGP1,000 for each day of delay in submitting the financial statements.

False or Misleading ESG Disclosures

The Capital Market Law further prohibits the publication of false or misleading information in prospectuses, reports, incorporation documents or other disclosures submitted to the FRA. Although FRA Decrees 107 and 108 do not provide specific penalties for ESG-related misstatements, false, misleading or incomplete ESG disclosures can expose a company and its officers to liability under Article 63 of the Capital Market Law No 95 of 1992. This provision penalises (among other acts):

• intentionally including false information in prospectuses, incorporation documents, reports or company-related announcements;
• issuing false statements regarding securities; and
• falsifying company records or presenting misleading reports to shareholders.

Penalties include imprisonment for up to five years and a fine of no less than EGP50,000 or the unlawful gain/avoided loss (whichever is higher) and up to EGP20 million or twice the unlawful gain/avoided loss (whichever is higher), or both. In parallel, Article 66 of the Consumer Protection Law No 181 of 2018 imposes fines of EGP50,000 to EGP1 million for misleading consumers.

In the coming years, Egyptian companies are expected to make steady progress in meeting ESG reporting obligations, particularly under the FRA’s mandatory disclosure rules for listed entities and large NBFIs. Reporting will likely evolve from simple compliance towards more detailed, metric-driven disclosures aligned with international frameworks such as the TCFD. Larger firms are also expected to integrate ESG more deeply into governance and corporate strategy, viewing it as essential for investor confidence and access to finance.

However, it is expected that companies will struggle with data collection and quality, especially in measuring emissions, resource use or social impact. The absence of a clear national taxonomy and limited third-party verification increases the risk of inconsistent reporting and greenwashing. Compliance also involves significant costs in systems, training and staff capacity, which may burden smaller companies.

In Egypt, there is no specialised procedural track or framework for ESG-related litigation. Cases are generally pursued under existing environmental, labour and corporate laws rather than through ESG-specific provisions.

Environmental claims may be pursued under the Environmental Law, which provides for both civil and criminal liability in instances of pollution or environmental damage. The EEAA plays a central role in reviewing EIAs. Civil courts rely on expert testimony and reports prepared by agencies such as the EEAA to determine damages and liability. Private parties have also successfully challenged companies for harmful emissions in isolated cases.

On the social side, the new labour law expands workers’ protections, aligning the framework more closely with modern ESG-oriented social standards. The new labour law establishes a specialised labour court system, with a labour court within the jurisdiction of each primary court, alongside appellate circuits specialising in labour disputes within the courts of appeal.

As for governance matters, disputes such as breaches of fiduciary duties, shareholder conflicts or mismanagement of assets are pursued under the Companies Law before the civil and commercial courts. These cases typically take the form of liability claims, challenges to shareholder or board resolutions, or compensation actions, and require proof of violation or damage. There are no specialised courts for governance cases.

In addition to the judicial system, the Egyptian Arbitration Law No 27 of 1994 (which is based on the UNCITRAL Model Law) provides a modern framework for both domestic and international arbitration, with the Cairo Regional Centre for International Commercial Arbitration serving as the leading institution. Arbitration provides another forum for ESG-related claims.

NGOs in Egypt play an important role in development, social advocacy and climate activism, though their activities are shaped by a heavily regulated environment.

In Egypt, there have been no publicly reported claims or regulatory actions specific to greenwashing. While investors and regulators have not yet pursued cases on misleading ESG disclosures, the risk exists under general rules against deceptive advertising and misrepresentation – which, theoretically, could apply to exaggerated sustainability claims. The Consumer Protection Authority is empowered to act against misleading marketing and advertising practices, though no precedent has been established in the ESG context.

Egypt has extensive jurisprudence concerning breach of statutory requirements related to ESG matters; however, specific ESG-related proceedings are yet to develop. While international agreements and investor expectations are likely to accelerate ESG compliance, the development of local legal precedents specific to the ESG agenda is expected to be gradual.