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Doing Business in Uganda: ESG Concerns for Your Business – Part I

By Paul Mbuga and Barnabas Tumusingize

ESG” (Environmental, Social, and Governance) has arguably become the most popular acronym in corporate boardrooms around the world: ESG goals; ESG strategies; ESG opportunities. In more advanced jurisdictions, a significant number of companies and organizations already have ESG policies in place and are recruiting ESG compliance and reporting officers to build and manage their ESG profiles. On the other hand, the corporate response to ESG in developing countries is still slow and divided.

In Uganda, many domestic businesses do not view ESG as an immediate or near-future concern. This is partly because ESG presently has no specific binding framework and, from a cursory glance, appears to provide no contribution to their profit margin.
However, with the increasing global pressure on companies to commit to responsible business, there is need to understand ESG and analyze its relevance to the Ugandan market.

The public perception of ESG is characterized by two extremes; those who pitch it as an emerging concept yet to revolutionize business and those who simply view it as a form of ‘disguised colonialism’ – another hypocritical agenda by the developed world to control the growth of young economies. However, rather than idolize ESG or discard it altogether, it is important to understand its merit and strategize on the best opportunities for engagement and action.

In our inaugural publication on ESG and the first of our publication series, we highlight the core ESG considerations for persons doing business in Uganda. We will explain what ESG is, why it matters to your business as well as the risks and opportunities.

 Co- authored by:
Ruth Muhawe - Junior Associate