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Egypt’s Financial Regulatory Authority (FRA) has entered into two agreements with the International Finance Corporation (IFC), a member of the World Bank Group, to strengthen sustainability practices and corporate governance across the country’s non-banking financial industry.

The partnership focuses on developing new tools to evaluate corporate sustainability performance, improving disclosure frameworks and expanding professional training in governance and institutional oversight.

FRA Chairman Dr. Islam Azzam attended the signing ceremony. The agreements were signed by FRA Vice Chairman Dr. Tarek Seif and Dr. Amira El-Saeed Aggag, IFC's Governance Projects Manager in Egypt.

New Tools for Measuring Corporate Sustainability

The first agreement establishes a technical and advisory cooperation framework through which IFC will support the FRA in advancing its environmental, social and governance framework.

A key deliverable is the development of an ESG Scorecard that will provide a structured basis for assessing companies' sustainability performance, supported by defined technical indicators and evaluation criteria.

IFC will also review the FRA's new sustainability reporting framework and provide technical recommendations to help improve the way regulated institutions disclose their sustainability practices.

The cooperation further includes preparing an initial draft of the proposed roles and responsibilities of sustainability officers within institutions, drawing on international standards and established practices.

In addition, FRA employees will receive training through workshops covering IFRS S1, the sustainability disclosure standard, and IFRS S2, which addresses climate-related disclosures.

Corporate Governance Programmes for Three Years

The second agreement brings together IFC and the Egyptian Directors Center, which operates under the FRA, allowing the center to incorporate and develop IFC's specialized educational resources within its accredited training programmes over a three-year period.

The resources include four components: sustainability training for board members, a board directors certification programme, guidance for board secretaries and a guide to the internal control environment.

The programmes are designed to strengthen governance structures and clarify the responsibilities of board secretaries, while improving professional understanding of internal controls, risk management, internal auditing and compliance.

Azzam: Cooperation Combines Regulatory Development with Technical Expertise

Dr. Islam Azzam said the agreements reflect the FRA's approach to developing the activities it regulates through both stronger regulatory frameworks and the technical capabilities required to put them into practice.

He highlighted the ESG Scorecard, the review of sustainability reporting requirements and the proposed responsibilities of sustainability officers as key outputs of the first agreement.

According to Azzam, these measures are expected to support more effective monitoring of institutional sustainability performance and improve the quality of environmental, social and governance disclosures.

He added that the IFC educational resources would help the Egyptian Directors Center broaden its professional training offering, particularly in board-level sustainability governance, internal control systems, risk management and compliance.

Seif: Sustainability Roles Support Better Institutional Oversight

Dr. Tarek Seif said defining the responsibilities of sustainability officers would help institutions organize oversight of sustainability-related matters.

The role is also expected to support coordination in preparing relevant information and reports and integrating sustainability requirements into administrative procedures and decision-making.

Seif noted that training FRA staff on IFRS S1 and IFRS S2 would improve their ability to assess sustainability and climate-related disclosures.

Periodic Indicators to Evaluate Training Effectiveness

Seif also explained that the results of programmes delivered through the Egyptian Directors Center would be reviewed using periodic performance indicators.

The evaluation will consider the number of participants, their satisfaction levels and whether institutions put the programmes' recommendations into practice.

These indicators are intended to measure the practical value of the training and identify opportunities for improvement across corporate governance, sustainability, internal controls, risk management and compliance.