Sire District, Ethiopia. Photo: Natalia Cieslik / World Bank

Key Activities

IFC launched its Integrated Environmental, Social, and Governance Ethiopia Project in 2023 to lay the foundation for environmental, social, and governance (ESG) practices in Ethiopia. The project aims at strengthening the ESG enabling environment through development of industry guidelines at the regulatory level, building capacity of market intermediaries at a market level, and improving ESG performance of selected banks for demonstration effect through in-depth advisory services at the firm level.

Regulatory Level

The project supports improvement of the ESG regulatory environment for banks in Ethiopia through development of ESG guidelines in partnership with the Ethiopian Bankers Association, the Chamber of Commerce, and the Accounting and Auditing Board of Ethiopia. The guidelines (are expected to be adopted by the end of post-implementation monitoring) will define E&S risk management and corporate governance standards and incorporate ESG disclosure requirements. The project will also support the real sector by partnering with the Accounting and Auditing Board of Ethiopia and Addis Ababa Chamber of Commerce and Sectoral Association of Ethiopia to develop ESG guidelines for the manufacturing and agribusiness sectors.

Market Level 

The market level ESG support is to be enhanced through increasing the capacity of the Ethiopian Bankers Association, the Chamber of Commerce, the Auditing and Accounting Board, and a selected cohort of Ethiopian consultants active in the market, to provide ESG related services and trainings to banks and real sector companies. It also plans to organize public awareness events on various ESG topics for banks and companies in the agribusiness, affordable housing, and manufacturing sectors, potentially together with the three organizations.

Firm Level

The project aims to improve the ESG performance of IFC clients in the financial, agribusiness, and manufacturing sectors through in-depth advisory support. 

Major Achievements

The project builds on the previous 2018–21 East Africa Corporate Governance Program’s experiences, challenges, successes, lessons learned, networks, and market profile in Ethiopia. It draws on the team’s experience in coordinating the environmental social risk management programs in Africa (Ghana, Nigeria, South Africa, 2013–21). The corporate governance program was focused on raising awareness of the business case for and benefits of sound corporate governance practices, building relationships with market-level intermediaries, training trainers, piloting firm-level corporate governance advisory service support, and engaging with the National Bank of Ethiopia on potential revisions to the regulatory framework. As part of the previous program, the IFC East Africa Corporate Governance Program (2018–21) implemented translation of  a few corporate governance related materials  into the local dialect of Amharic including IFC SME Governance Guidebook and Handbook: IFC Family Business Governance.

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