Regulatory Alerts2021-07-18
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Circular dated 18 July 2021 on sustainable finance
The Central Bank of Egypt issues a circular attaching a discussion paper and guiding principles for the application of sustainable finance in the Egyptian banking sector. The document defines sustainable finance through environmental, social, and governance (ESG) elements and outlines associated risks, including physical, reputation, credit, social, and legal risks. It establishes five guiding principles for banks: building capacity and knowledge; enhancing sustainable financing by integrating ESG into lending and investment decisions; avoiding negative impacts and promoting positive ones; managing climate change risks; and applying sustainability to internal bank operations. Additionally, it mandates the establishment of information systems and periodic reporting on sustainable finance activities.
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