When does ESG reporting become mandatory in Kenya?
ICPAK's roadmap brings companies in by phase, based on the accounting period that begins on or after each date. Public interest entities come first, from 1 January 2027, followed by large non-PIEs in 2028, SMEs in 2029 and government organisations from 1 July 2028.
- Voluntary
2024
Any organisation
Periods beginning on or after 1 January 2024
- Mandatory
2027
Public interest entities (PIEs)
Periods beginning on or after 1 January 2027
- Mandatory
2028
Large non-PIEs
Periods beginning on or after 1 January 2028
- Mandatory
2029
SMEs that are not PIEs
Periods beginning on or after 1 January 2029
- Public sector
2028
Government organisations reporting under IPSAS, using IPSASB SRS 1
Periods beginning on or after 1 July 2028
Your first mandatory year is the first financial year that begins on or after your date. A PIE with a June year end, for example, starts its first mandatory year on 1 July 2027.
Which companies are public interest entities in Kenya?
In Kenya, public interest entities are organisations whose activities have a significant impact on the public and on financial markets. ICPAK lists seven groups, and if your organisation is in any of them, you report from 2027.
- Companies listed on the Nairobi Securities Exchange
- Commercial banks regulated by the Central Bank of Kenya
- Insurance companies regulated by the Insurance Regulatory Authority
- Retirement benefit schemes and pension funds regulated by the Retirement Benefits Authority
- Fund managers and collective investment schemes regulated by the Capital Markets Authority
- Deposit-taking SACCOs regulated by the Sacco Societies Regulatory Authority
- Large state corporations and government-controlled entities with significant public accountability that report under IFRS Accounting Standards
What counts as a large non-PIE in Kenya?
A large non-PIE is a company that is not a public interest entity but exceeds two of three size thresholds taken from Kenya's MSME Policy, 2025: annual turnover above KES 100 million, total assets above KES 250 million, or more than 250 employees. These companies report from 1 January 2028.
ICPAK also urges companies with turnover above KES 1.3 billion, in line with Kenya's large taxpayer classification, to start preparing earlier because of their scale and visibility. A company below the thresholds falls into the SME phase from 2029.
Exceeds two of three
Source: Kenya's MSME Policy, 2025, as used by ICPAK. Reports from 1 January 2028.
What is the ICPAK readiness assessment, and is it still due?
Every public interest entity had to complete a mandatory Sustainability Reporting Readiness Assessment before its first disclosures. ICPAK set the deadline at six months before the 1 January 2027 start and later extended it to 31 July 2026, so for PIEs the assessment period has now closed.
The assessment was completed through ICPAK's Sustainability Gap Analysis Tool: a pre-assessment screen, a 49-item checklist mapped to the four pillars of IFRS S1 and S2, and a review of disclosure quality. ICPAK has published the list of PIEs that completed it. PIEs that did not are recorded as having outstanding compliance with the requirement and are expected to address it; if that is your organisation, contact ICPAK at technicalservices@icpak.com.
ICPAK is clear that completing the assessment does not in itself mean compliance with IFRS S1 and S2. It is a preparatory step, and the roadmap expects every organisation to go through a readiness assessment before its first disclosures, so confirm the timing for later phases directly with ICPAK.
ICPAK Sustainability Gap Analysis Tool
- 01Pre-assessment screen
- 0249-item checklist
- 03Review of disclosure quality
How ready are Kenyan companies?
Not very, yet. ICPAK's Kenya IFRS S1 and S2 Readiness Report 2026 scored 385 public interest entities across seven regulated sectors and gave Kenya a national readiness score of 1.51 out of 4, which ICPAK calls the "Emerging" band. Three in four of those entities sit in the two lowest bands, and only 23, or 6%, show advanced readiness.
1.51out of 4
National readiness score, "Emerging" band
6%23 entities
Show advanced readiness
444of 512 PIEs
Completed the assessment
Pillar scores, out of 4
Of the 512 PIEs on ICPAK's register, 444 completed the assessment and 385 gave answers that could be scored. Governance was the strongest pillar, at 1.60 out of 4, because boards are naming owners for sustainability. Metrics and targets was the weakest, at 1.22, with internal carbon pricing, climate-linked pay and carbon credit policies almost never disclosed. ICPAK calls this the readiness paradox: companies are more prepared to talk about sustainability than to report it.
Readiness also varies sharply by sector. Other listed companies, state corporations and commercial banks lead, while pension schemes and deposit-taking SACCOs lag, with listed companies scoring 1.9 times the readiness of SACCOs. See ICPAK's announcement of the report.
When does assurance of sustainability reports start in Kenya?
Assurance is phased in after reporting starts. For public interest entities, limited assurance applies from accounting periods beginning on or after 1 January 2028, reasonable assurance excluding Scope 3 emissions from 2029, and full reasonable assurance from 2030.
| Who | Limited assurance | Reasonable, excluding Scope 3 | Full reasonable assurance |
|---|---|---|---|
| Public interest entities | 2028 | 2029 | 2030 |
| Large non-PIEs | 2029 | 2030 | 2031 |
| SMEs | 2030 | 2031 | 2032 |
Accounting periods beginning on or after 1 January of the year shown. Large non-PIEs follow one year after PIEs and SMEs two years after.
Large non-PIEs follow one year later and SMEs two years later. The assurance provider must hold an ICPAK Category A or Category C licence, have the sustainability accreditation ICPAK requires, and be independent of the organisation under the IESBA Code of Ethics. ICPAK advised PIEs to engage their assurance provider early, by 30 June 2026, so that assurance is designed into reporting processes rather than added afterwards.
What reliefs apply in the first year in Kenya?
Kenya's roadmap adopts the ISSB's transition reliefs for the first annual reporting period. A company may report only on climate-related risks and opportunities, leave out Scope 3 emissions, keep an existing emissions method instead of the GHG Protocol, and publish up to nine months after the period ends.
Climate only
Report only on climate-related risks and opportunities
No Scope 3
Leave out Scope 3 emissions
Existing method
Keep an existing emissions method instead of the GHG Protocol
Nine months
Publish up to nine months after the period ends
No comparatives
No comparative figures for the prior period
It also does not need to give comparative figures for the period before it first applies the standards. Reliefs postpone a disclosure rather than remove it, so record which ones you elect and plan for the second year.
Which emission factors and metrics does ICPAK expect?
ICPAK expects Scope 1, Scope 2 and Scope 3 emissions to be calculated with recognised methods and emission factors, such as the IPCC guidelines, the International Energy Agency and the UK DEFRA databases. Where local factors are not available, international factors may be used, with the method disclosed.
For other metrics, ICPAK says companies shall consider the industry-based SASB Standards, include the SASB code for every metric reported, and explain any SASB topic they judge not applicable. It also encourages a sustainability content index showing where each IFRS S1 and S2 requirement is addressed, and it expects board sign-off on first-year disclosures.
Recognised factor sources
What about government organisations and the public sector?
ICPAK's roadmap applies mainly to corporate reporting entities. Government organisations reporting under IPSAS are scheduled to start from 1 July 2028, using IPSASB SRS 1 on climate-related disclosures.
Further guidance for the public sector is being developed by a national committee that includes the National Treasury and the Public Sector Accounting Standards Board. State corporations that report under IFRS Accounting Standards and have significant public accountability are treated as public interest entities and report from 2027.
Government organisations
1 July 2028
Reporting under IPSAS, using IPSASB SRS 1 on climate-related disclosures
Who enforces ESG reporting in Kenya?
ICPAK coordinates oversight with Kenya's sector regulators: the Capital Markets Authority, the Central Bank of Kenya, the Insurance Regulatory Authority, the Sacco Societies Regulatory Authority and the Retirement Benefits Authority. Each oversees the entities in its own sector.
ICPAK coordinatesCapital Markets AuthorityCentral Bank of KenyaInsurance Regulatory AuthoritySacco Societies Regulatory AuthorityRetirement Benefits AuthorityICPAK expects boards and audit committees to take direct responsibility for the quality and timeliness of disclosures, and treats board sign-off on the first report as a key governance indicator.