Insurance Regulatory Authority of Uganda issues ESG guidelines for insurance sector ahead of mandatory IFRS sustainability reporting from 2028

The Insurance Regulatory Authority of Uganda has issued Environmental, Social and Governance guidelines for the insurance sector, setting out a supervisory framework to help firms adopt ESG practices and identify, measure and manage ESG related risks and opportunities. The guidance is positioned as soft guidance and as a preparatory step toward mandatory sustainability reporting, with the Authority stating that it should be used to align business processes and ESG reporting. The guidelines apply on a proportionate basis to insurers, reinsurers, Health Membership Organisations, microinsurance organisations, brokers, reinsurance brokers, and licensed loss assessors, adjusters and risk advisors. They establish a two tier approach, with Tier A covering life insurers, non-life insurers and reinsurers and requiring a more comprehensive ESG framework, and Tier B covering intermediaries, microinsurers and HMOs and requiring a foundational framework. The document covers materiality and double materiality assessments, board and senior management responsibilities, ESG risk identification, underwriting and pricing, environmental due diligence for restricted sectors, investment and stewardship, operations, disclosure requirements, metrics and a phased path to IFRS alignment. For Tier A insurers, scenario analysis outputs are expected to feed into the Own Risk and Solvency Assessment. The Authority said the guidelines will inform its future regulatory framework on mandatory reporting. They are intended to prepare the sector for compliance with the Institute of Certified Public Accountants of Uganda roadmap, under which insurers must apply IFRS S1 and IFRS S2 for financial years beginning on or after 1 January 2028.