FRA, UN discuss sustainable development, women’s empowerment in Egypt

Fatma Salah
6 Min Read

Mohamed Omran, Chairperson of the Financial Regulatory Authority (FRA), met on Wednesday separately with Elena Inova, the United Nations Resident Coordinator, and Mark Napier, the CEO of FSD Africa, at the Smart Village in Cairo.

Both meetings discussed the FRA’s efforts in sustainable development and the empowerment of women within the non-banking financial sector.

During his first meeting with Inova, which was also attended by Sylvian Merlin – Deputy Resident Representative of the United Nations Development Program – Omran reviewed the Authority’s efforts for the empowerment of women.

The FRA issued Resolution No. (25) of 2020 which stipulates that at least one woman be present in the boards of directors of companies, including those listed on the Egyptian Exchange. As a result, the number of women holding board memberships at companies jumped from 566 women in 2019 to about 1,000 women in 2021, with an increase of about 77%. Moreover, the number of companies with women on their boards of directors reached more than 80% in Egypt last year, up from only about 44% in 2019.

During the meeting, the representatives of the United Nations expressed their interest in the legislative amendment proposed by the FRA by making an amendment to the provisions of bonds, securitization bonds and sukuk in the executive regulations of the capital market law and the inclusion of four new financing tools in the capital market, including social bonds, sustainability bonds, green bonds, and gender equality and women’s empowerment bonds. They also suggested providing technical support and assistance to market parties to build capacities and readiness for the first issuance of those bonds.

The United Nations delegation inspected the Knowledge Complex for the financial culture at the FRA, and got acquainted with the activities of the complex.

Afterwards, Omran met Mark Napier, the CEO of the FSD Africa development agency, which is supported by UK Aid, to discuss partnership and cooperation frameworks in facilitating the transformation of the non-bank financial sector towards green and sustainable financing.

The FSD Africa recently expanded its geographical scope to include North Africa which would enable it to strengthen financial markets and stimulate sustainable growth in the African continent by employing more than £1.5bn as long-term investments in companies and infrastructure in Africa.

Omran stressed that there are huge financial burdens borne by global economies at the environmental, social, and institutional level as a result of climate-related risks, and that these burdens are intensifying under the weight of the spread of the Coronavirus pandemic, which called on Egypt to move towards urgently deepening the principles of sustainability, and promoting the integration of green finance in the policies of those working in non-bank financial activities.

He noted that the insurance sector, which is one of the most important non-banking financial services activities, became more sustainable across all companies whose investments reached EGP 132bn in the previous fiscal year.

Omran said that the FSD Africa meeting focused on discussing areas of cooperation and providing technical support to development partners from companies and entities working in non-bank financial activities to develop and implement policies and frameworks related to environmental, social and governance practices for companies related to sustainability. The FSD Africa would also provide assistance to companies listed on the Egyptian Exchange and others operating in non-banking financial activities after the FRA asked them to submit disclosure reports on the environmental, social, and corporate governance (ESG) and the Task Force on Climate-related Financial Disclosures (TCFD) within the company’s annual board of directors’ report.

The dialogue also touched on the establishment of the Regional Center for Sustainable Finance – affiliated with the FRA and its role in spreading awareness of sustainable development and promoting a culture of green economy within the non-banking financial sectors, in addition to providing support and technical advice to ensure the commitment of those receiving green finance to invest this finance in the purpose designated for that.

During the meeting, Omran welcomed the initiative of the FSD Africa to provide support for promoting emerging financial technology that can enhance the resilience of non-bank financial activities to the negative impacts of climate change.

On his part, Napier expressed his interest in cooperating with the FRA in many initiatives that contribute to accelerating the integration of green finance into non-bank financial activities, and supporting financial innovation initiatives that can be employed and scaled up to support the national economy, as well as attract international and local innovators in designing products and services that help the Egyptian financial sector adapt to the post-COVID-19 landscape, as the Africa Development Agency is a digital trade investor and an incubator for startups in the digital economy in Africa.

This meeting comes within the framework of the preparations being taken for the upcoming climate summit COP 27 – to be held in Sharm El Sheikh in November – and directing efforts in non-bank financial activities towards mitigating and adapting to climate change risks, and continuing to build partnerships with all parties interested in sustainable financing, raising awareness of it and building capacity.

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