Navigating the ESG reporting landscape in Oman

Oman is experiencing a rapid transformation in its approach to environmental, social, and governance (ESG) reporting. While still in its early stages, the country’s commitment to integrating ESG principles into its business and investment landscape is undeniable. This article delves into the status of ESG reporting in Oman, its crucial importance, the challenges encountered, and the path forward, considering the influence of the global ESG landscape and the eventual necessity of ESG assurance.

Oman’s journey towards robust ESG reporting began with the launch of its initial ESG framework in September 2021 by the Government of Oman. This marked a significant step, providing a foundational structure for companies to align their practices with sustainable development goals. The Central Bank of Oman’s subsequent circular to the financial sector, aligning with the UN Sustainable Development Goals (SDGs), further solidified the nation’s commitment. The Muscat Stock Exchange (MSX) joined the UN Sustainable Stock Exchange (SSE) initiative in March 2022, demonstrating a willingness to embrace international best practices. This commitment is further strengthened by MSX’s collaboration with the Capital Markets Authority of Oman (CMA), now the Financial Services Authority (FSA), to implement mandatory ESG reporting requirements based on Global Reporting Initiative (GRI) standards.

MSX encourages all publicly listed companies to voluntarily report in 2024, covering their 2023 activities. Starting in 2025, reporting on the 2024 activities will be mandatory. The mandatory reporting requirements, though recently introduced, represent a significant leap forward. While the specific details of these requirements and their implementation timeline may still be evolving, this effort underscores Oman’s ambition to become a leader in ESG within the Middle East. The country’s proactive approach is mirrored by other nations in the region, including Bahrain, the UAE, Qatar, and Kuwait, which have also launched significant ESG initiatives. This regional collaboration fosters knowledge sharing and potentially smoother transitions to mandatory reporting frameworks.