Inaugural Survey of Reporting on CSR by Constituent Companies of the Egyptian Exchange SRI Index – Emerging Markets ESG – November 25, 2016

Today Emerging Markets ESG publishes its inaugural Survey of Reporting on Corporate Social Responsibility (CSR) by the Constituent Companies of the SRI Index of the Egyptian Exchange (EGX SRI Index).

The survey analyzes environmental, social and governance (ESG) disclosures in the English-language 2015 or 2014 annual reports and on the websites of the 29 constituent companies of the EGX SRI index as of the record date of August 1, 2016.  If a company published its 2015 or 2014 annual report after August 1, 2016 it was not analyzed.

On August 1, 2016 all 29 constituent companies (100%) have an English-language website. 19 companies (65%) have a 2014 or 2015 English-language annual report online on the same record date.

Two companies (7%) have a recent stand-alone English-language environmental, social and governance (ESG) report available online on August 1, 2016.  Two companies have reports dated prior to 2013, but these were considered out of date and therefore not analyzed.

25 of the 29 constituent companies (86%) disclose information about sponsorships on the corporate website, whereas only eight companies (27%) disclose this information in the annual report.  No other ESG data point was disclosed this widely.  19 of 29 companies (65%) disclose audit related information on the corporate website, compared with nine companies (31%) in the annual report.  12 of the 29 companies (41%) disclose environmental considerations in supply chain management on the corporate website, compared with five companies (17%) in the annual report.  Of the three categories – E, S and G – no one category contains significantly more disclosures, with the exception of sponsorships.  In general, a disparity between online and annual report disclosure was observed.  For example, 11 companies (38%) disclose a corporate code of conduct/ethics on the website, whereas only one company (3%) discloses this in its annual report.

The survey analyzes the English-language annual reports and websites of these companies  in order to document the current disclosure practices of this “blue-chip” SRI peer group and identify best practices among the peer group.  By analyzing disclosures in both annual reports and websites, the survey tracks the timing of the publication of the annual report and the related yet separate issue of periodic disclosure, namely, how blue-chip companies keep their websites data-rich and up-to-date.  

This inaugural Egyptian survey echoes surveys of reporting by listed companies in Central and Eastern Europe as well as Brazil, Russia, India and China (BRIC) and Ukraine conducted by the Partners for Financial Stability (PFS) Program from 2003-2009.  The Egyptian survey uses the same reporting template and analyzes the same 15 ESG indicators.  In 2010 Emerging Markets ESG conducted a preliminary analysis of CSR reporting by the 10 largest listed companies in Egypt, but due to the lack of information disclosed, a comprehensive survey was not conducted

This inaugural Egyptian survey will allow constituent companies of the EGX SRI index to benchmark their disclosure practices against peers on a national, industry and global basis.

A number of Egyptian companies and financial institutions demonstrate best practice in CSR reporting; these include:  Arabian Cement Company, CIBC, Egyptian Financial Group – Hermes Holding Company, Oriental Weavers and Raya Holding for Technology and Communications.

Nape Jason Jencka, a final-year undergraduate student of economics and finance at Sierra Nevada College in Incline Village, Nevada conducted the survey, under the supervision of Geoffrey Mazullo, Principal, Emerging Markets ESG, from August 1 through November 15, 2016.

For more information about the survey, please contact Emerging Markets ESG.