~ By Carole Ayugi

In the previous article, we examined the global ESG frameworks that shape how sustainability is measured and disclosed. Those frameworks provide structure. This month, the focus shifts to what is happening in practice.

In Kenya, ESG is no longer confined to reporting — it is increasingly influencing how businesses operate, how risks are assessed, and how capital is allocated. This reflects a broader shift: sustainability issues, particularly climate risk, are no longer peripheral concerns, but core economic factors shaping markets, investment decisions, and long-term growth.

This transition is also being reinforced by regulatory developments. From 2027, sustainability disclosures based on IFRS standards will become mandatory for public interest entities in Kenya — including listed companies, banks, insurers, and pension schemes — with phased implementation expected to extend to other organisations over time. ESG is therefore moving beyond voluntary frameworks into structured, enforceable practice.

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