Manama, Bahrain – 19th November 2023 – In line with its commitment to transparency, strong corporate governance, and the pursuit of social and climate-related objectives, the Central Bank of Bahrain (CBB) has released the Environmental, Social, and Governance (ESG) requirements module on the 5th of November 2023. This module is directed at all listed companies, banks, financing companies, insurance firms, and category 1 and 2 investment firms, providing them with guidelines on the reporting requirements for the environmental, social, and corporate governance factors.
The CBB recognizes that the ESG landscape is ever evolving, and this module represents a transformative step towards a more sustainable financial market. The issuance of this module underscores the CBB’s dedication to both national and international social and climate-related objectives, while also reinforcing its overarching objective of upholding transparency in disclosures and promoting strong corporate governance standards.
Commenting on the issuance of the new module, Ms. Abeer Al Saad, Executive Director of Financial Institutions Supervision at the CBB, said: “In today’s business landscape, financial metrics are no longer the sole criteria for evaluating companies. Shareholders and investors now expect companies to demonstrate greater transparency regarding their impact on the environment, society, and governance practices. The ESG module aims to serve as a valuable tool for companies starting their reporting journey with the aim of creating reliable, informative, and comparable reports. Moreover, all listed companies, banks, financing companies, insurance firms, and category 1 and 2 investment firms shall start the reporting of these requirements from the financial year 2024”.
The module draws on global standards and frameworks to ensure effective ESG integration. It incorporates findings from the ESG Reporting Survey conducted by the CBB in 2022, which involved various entities such as listed companies, insurance firms, banks, and investment firms. Furthermore, the module’s development considered the industry feedback received during the consultation on the draft guidelines held in mid-2023.
The CBB encourages companies to proactively implement strategies that enhance their environmental and social performance while upholding the highest standards of governance. In addition, it emphasizes the importance of addressing ESG-related risks that align with Bahrain Economic Vision 2030 and the UN Sustainable Development Goals (SDGs).