In line with its commitment to proactive sustainability development, Qatar became the first country in the GCC to adopt the International Sustainability Disclosure Standards (ISSB). The country also plans to proceed with wider mandatory application, setting the pace for regional development in the field of sustainability reporting.
Qatar’s consistent focus on ESG promotion in the Gulf region is guaranteed to yield significant positives, but to what extent? This article examines the current sustainability landscape across the GCC and an overview of Qatar’s Sustainability Disclosure Framework.
The Current State of Sustainability Reporting in the GCC
Sustainability reporting has become crucial for businesses in the GCC. Companies are adopting more ESG-aligned practices into their operations in a bid to foster a progressive environment for local regulators and international investors. These ESG disclosures also ensure that companies can establish a structured framework for dealing with sustainability risks and creating opportunities.
In the GCC, early adoption cases involved a focus on state-owned enterprises and companies with a significant international presence. However, the ESG winds are changing with the trend extending to medium-sized enterprises and private owned companies. A key progress point is the introduction of listing requirements by regional stock exchanges. This move, aimed at mandating or encouraging sustainability disclosure, is key to driving the widespread adoption of sustainability reporting across various organizational structures.
What is the Current Gap Between Voluntary and Mandatory ESG Reporting?
However, it is worth recognizing the significant gulf existing between voluntary and mandatory ESG reporting in the region. Some markets have taken reporting to the next level by establishing it as a primary requirement for listed companies. Others maintain a more liberal front with voluntary frameworks and consistent market pressure to steer companies into compliance.
Despite its well-intentioned corporate objectives, these reporting strategies still have some loopholes. Mandatory requirements prioritize specific disclosure areas as opposed to developing a comprehensive sustainability report. This results in a lack of depth in crucial information needed to align with international best practices.
On its part, voluntary reporting allows flexibility but creates inconsistency. This is the undesirable result of companies choosing what frameworks to align with and which metrics to disclose.
Qatar’s Sustainability Disclosure Framework
By adopting the ISSB standards, the Qatar Central Bank (QCB) aims to enhance transparency, accountability and trust in sustainability reporting. Below are some key framework provisions:
Requirements to Prepare and Submit a Sustainability Report
1. Financial institutions must prepare and submit a report to the QCB for each financial year starting from January 2026.
2. Financial institutions must include evidence of compliance with all requirements of IFRS S1 (General Requirements for Sustainability-Related Disclosures) and IFRS S2 (Climate-related Disclosures)
Report Timing
1. First Annual Reporting Period: Sustainability-related financial disclosures can be published after annual financial statements.
2. Second Annual Reporting Period: Sustainability-related financial disclosures must be published with annual financial reports.
Transition Planning
1. Financial institutions should formulate plans for harnessing opportunities within the first year of annual reporting.
2. Climate-related transition plans are expected to cover the targets of the company towards achieving a low-carbon economy in Qatar.
External Assurance
Financial institutions are expected to establish measures that guarantee reliability of sustainability disclosures and to counter the adverse effects of greenwashing.
What’s Next for Sustainability Reporting in Qatar?
Qatar’s sustainability reporting commitments are positioned to revolutionize national ESG standards across the GCC. Currently, companies within Qatar’s business landscape are only required to adopt a voluntary approach to disclosures, creating loopholes and relaxed compliance measures.
However, with Q1 2026 round the corner, sustainability reporting standards are going to get more defined. Companies fond of shying away from their disclosure responsibilities could be exposed to non-disclosure sanctions.
ICELIS Global; Your Sustainability Reporting Partner
Given Qatar’s current stance on sustainability reporting, it’s vital for companies to understand the impact of these disclosure requirements on their business. That’s where ICELIS Global comes in.
Our dedicated team of ESG experts are committed to helping you navigate Qatar’s sustainability reporting landscape and guarantee consistent disclosures that align with international ESG standards.
Contact us today and let’s guide you through sustainability disclosure requirements across Qatar’s financial sector.