Ministries, state corporations and county governments are set to face tougher reporting requirements on climate-related risks from January 2028 under a new international sustainability reporting standard.
The International Public Sector Accounting Standards Board (IPSASB) has issued Sustainability Reporting Standard (SRS) 1 – Climate-related Disclosures, marking a major shift in how public institutions will be expected to report.
This is not only on how public funds are spent but also on how climate-related risks and opportunities affect the value they create for society, the economy and the environment.
Speaking during the launch of the 2026 Financial Reporting (FiRe) Awards in Nairobi on Thursday, the Public Sector Accounting Standards Board-Kenya, chief executive Georgina Muchai, said the global reporting landscape is evolving rapidly.
This, as governments come under increasing pressure to provide greater transparency beyond traditional financial statements.
“Across the world, citizens are increasingly demanding greater transparency not only on how public money is spent but also on how governments create sustainable economic, social and environmental value. Sustainability reporting is therefore emerging as the next frontier of public sector accountability,” Muchai said.
The new standard, which becomes effective on January 1, 2028, is expected to require public institutions to disclose climate-related risks, governance structures, strategies and actions taken to address the impacts of climate change.
The disclosures are designed to improve transparency and provide stakeholders with better information on how public entities are managing long-term environmental and financial risks.
The development signals that climate reporting is becoming an integral part of public financial management, with ministries, counties and state agencies expected to begin preparing for the new requirements well before the implementation date.
“Organisations that embrace high-quality reporting are better positioned to attract investment, improve access to finance, strengthen stakeholder confidence and create sustainable value,” said FiRe Award Exco chair and the Institute of Certified Public Accountants of Kenya (ICPAK) CEO, Grace Kamau.
The announcement comes as sustainability reporting gains prominence globally, with investors, development partners and citizens increasingly seeking information that extends beyond financial performance to include environmental, social and governance (ESG) considerations.
“Companies that report transparently on their sustainability practices build more trust with investors, attract more capital, and position themselves for long-term resilience,” Capital Markets Authority CEO, Wyckliffe Shamiah, affirmed.
Retirement Benefits Authority CEO, Charles Machira, said elevating reporting standards is not just about regulatory compliance; it is foundational to building long-term stakeholder trust, securing member funds and driving sustainable growth across the entire industry.
Nairobi Securities Exchange (NSE) chief executive Frank Mwiti said the 2026 FiRe Award underscores the exchange’s commitment to promoting transparent financial and sustainability reporting as a key pillar of good corporate governance.
He said recognising organizations that uphold high reporting standards helps boost investor confidence, attract capital and strengthen Kenya’s appeal as an investment destination.
