AMMAN — The Jordan Securities Commission (JSC), with support from the International Finance Corporation (IFC), launched recently an Environmental, Social and Governance (ESG) Code for listed companies, aimed at strengthening corporate governance, sustainability and resilience and enhancing Jordan’s attractiveness to investors.

 

The code is designed to help companies strengthen their structures, strategies, policies and practices to support long-term value creation and align corporate reporting with internationally recognised sustainability standards.

 

Speaking during the launch event, JSC Commissioner Razan Shafei said the Commission is seeking to promote ESG adoption among listed companies and strengthen the quality and transparency of information available to investors.

 

The code is expected to begin applying to targeted companies from January 1, 2027, following a preparation period during the remainder of 2026.

 

During the first panel, “The Strategic Role of ESG in Investment Decision-Making,” IFC Senior Country Officer Marcel Rached, highlighted the growing importance of integrating ESG considerations into investment decisions, as environmental, social and governance factors increasingly form part of assessments of investment risks and opportunities.

 

Veronika Pountcheva, Board Member of the International Sustainability Standards Board (ISSB), who participated virtually, discussed the IFRS Sustainability Disclosure Standards, including IFRS S1 and S2, which provide a global baseline for sustainability-related financial disclosures.

 

The second panel, “Advancing Jordanian Listed Companies’ Practices for Sustainable Growth and Investment,” examined the development and implementation of the JSC ESG Code and challenges facing companies in strengthening their ESG practices.

 

Director of the Issuers and Products Directorate at the JSC, Saleh Raqad, presented the journey of developing the ESG Code, while Director of the Technical and Strategic Affairs Department at the JSC, Deema Tahtamouni, discussed its implementation.

 

Director of the Planning and Institutional Development Department at the Amman Stock Exchange (ASE), Rasha Dayyat, addressed current ESG challenges, while Corporate Governance and ESG Expert, Maali Khader, discussed ways to strengthen ESG practices among listed companies.

 

Speakers stressed that ESG should not become merely a reporting or compliance exercise, but should be embedded in companies' strategies, governance, risk management and decision-making.

 

They also highlighted the need for reliable ESG data, clear internal responsibilities and greater involvement by boards and senior management to ensure sustainability information is used to improve corporate performance.

 

The discussions further highlighted a shift from traditional sustainability and corporate social responsibility reporting towards assessing how sustainability-related risks and opportunities can affect companies’ financial performance, risks and future prospects.

 

The JSC said the code was developed through around two years of consultations, training and engagement with companies and other stakeholders.

 

In an interview with The Jordan Times, JSC Chairman of the Board of Commissioners Emad Abu Haltam said the first phase of implementation would cover the 20 companies listed on the first market, including banks, extractive industries, telecommunications and petroleum companies.

 

The initiative is intended to ensure that investors comparing opportunities across countries see Jordan as having “state-of-the-art and up-to-date standards” that provide transparency, good governance and greater investment attractiveness, Abu Haltam said.

 

He added that the ESG Code comes alongside government efforts to develop strategic and infrastructure partnerships and investments, as well as national efforts to expand green and climate financing.

 

“The capital markets provide the framework and platform for investors and companies seeking financing to have other channels of financing aside from banking,” Abu Haltam said, pointing to instruments such as green and blue bonds as potential channels supporting the objectives of the Economic Modernisation Vision.

 

Meanwhile, Dayyat told The Jordan Times that the main challenge was ensuring companies do not view ESG simply as another reporting requirement.

 

“The biggest misconception is that ESG is simply another reporting or compliance requirement. ESG is not about ticking a box; it is about improving how a company is governed, how it manages risks, and how it creates long-term value,” she said.

 

Companies have different levels of readiness and may face challenges including limited expertise, difficulties in collecting reliable data and the cost of developing the required systems and capabilities, Dayyat said.

 

"Implementation should be gradual, balanced and proportionate, supported by clear guidance, training and capacity building," she added.

 

Ultimately, the success of the ESG Code should not be measured only by the number of reports produced, but by whether ESG becomes part of how companies make decisions, manage risks and create sustainable value, Dayyat concluded.