What is ESG?

ESG stands for Environmental, Social and Governance. It is the framework companies, banks and regulators use to measure and disclose how a business affects the environment and the people around it, and how it is governed. What separates ESG from a corporate values statement is that it is reported: defined metrics, a named standard, a reporting period, and increasingly an external auditor and a regulator.

What each letter in ESG means

ESG, sustainability and CSR are not the same thing

The three are used interchangeably in press coverage and they are not interchangeable. The shortest way to hold them apart: sustainability is the goal, corporate social responsibility is the voluntary initiative, and ESG is the measurement and disclosure framework.

Who sets ESG standards?

No single body owns the field. Four names carry almost all of it, and they now overlap rather than compete.

• ISSB - IFRS S1 and IFRS S2

  The International Sustainability Standards Board sits under the IFRS Foundation and issued IFRS S1 (general sustainability disclosure) and IFRS S2 (climate) in June 2023. These are the standards Qatar’s financial regulators have adopted, and the IFRS Foundation publishes them in Arabic.

• GRI

  The Global Reporting Initiative is the oldest and most widely used sustainability reporting standard, written for a broad stakeholder audience rather than for investors specifically. Most first-time Gulf reporters start here.

• SASB

  Industry-specific metrics for 77 sectors, aimed at investors. The SASB Standards are now maintained by the ISSB and IFRS S1 requires companies to consider them.

• TCFD

  The Task Force on Climate-related Financial Disclosures defined the four-pillar structure below. Its recommendations were absorbed into IFRS S2 and the ISSB took over monitoring progress in 2023, so TCFD is now a lineage rather than a separate filing.

The IFRS Foundation publishes IFRS S1 and IFRS S2 in Arabic on its own site, which is the primary source and the one to read before any commentary about them.ifrs.org

What is now mandatory in Qatar?

Qatar has moved from voluntary sustainability reporting to a regulated one, regulator by regulator rather than through a single national rulebook. Scope, standard and start date differ by who licenses you, so the honest answer to "does this apply to me" begins with which regulator you sit under.

For banks and insurers, Qatar Central Bank launched a Sustainability Reporting Framework in December 2025 that adopts the ISSB standards - IFRS S1 and IFRS S2 - and obliges them to disclose from 1 January 2026. Inside the Qatar Financial Centre the QFCRA runs its own GENE (Corporate Sustainability Reporting) Rules 2025, which converge on the same ISSB standards but differ in scope, in enforcement architecture and in the transitional flexibility each allows. The two articles below set out those differences in full; this page does not summarise them, because a summary of a rule is the thing people act on and get wrong.

What a sustainability report actually contains

Under the ISSB standards a disclosure rests on four pillars, in this order. They are the same four TCFD defined, which is why a company that already reported against TCFD is not starting from nothing.

1. 1

   Governance

   Which board committee oversees sustainability risk, how often it sees the numbers, and how management is held to them.

2. 2

   Strategy

   The sustainability risks and opportunities that actually affect the business model, over what time horizon, and what they do to the financial statements.

3. 3

   Risk management

   The process by which those risks are identified, assessed and prioritised, and how it connects to the enterprise risk framework already in place.

4. 4

   Metrics and targets

   The numbers themselves, the basis on which they were prepared, the comparative period, and the targets the company has set against them.

Scope 1, Scope 2 and Scope 3 emissions

The three scopes come from the Greenhouse Gas Protocol and every climate disclosure standard uses them. The split is about who controls the source of the emission, not about how serious it is.

• Scope 1 - direct

  Emissions from sources the company owns or controls: its own boilers, furnaces, process emissions and vehicle fleet.

• Scope 2 - purchased energy

  Emissions generated elsewhere to produce the electricity, steam, heating or cooling the company buys and consumes.

• Scope 3 - value chain

  Everything else, up and down the value chain: purchased goods and services, business travel, employee commuting, use of sold products, and for a bank the emissions of what it finances. It is usually the largest of the three and the hardest to measure, which is why it is treated separately in most disclosure regimes.

How each Qatari framework treats Scope 3, and what transitional relief it allows, is a question of the specific rulebook rather than of the definition. It is covered in the QFCRA and QCB comparison linked above.

Where the Gulf stands on ESG

Every GCC state has moved in the same direction over the last three years, from encouragement to exchange guidance to binding rules for regulated entities, and each has arrived at a different point on that path. The ISSB standards are the common destination; the timetables and the thresholds are not common at all.

GCC ESG standards: how each Gulf state is progressing in 2026

Common questions