Oman’s Move Towards Mandatory
Sustainability Disclosures:
What Businesses Need to Know

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As global markets continue to prioritize transparency, sustainability, and climate accountability, Oman is taking a major step toward aligning with international ESG (Environmental, Social, and Governance) reporting standards. The Financial Services Authority (FSA) has announced a phased roadmap to implement mandatory sustainability disclosures for listed companies and regulated financial institutions in Oman.

This development marks a significant shift in the country’s financial reporting landscape and creates new compliance responsibilities for businesses operating in Oman.

What Is Changing in Oman?

The FSA is introducing the adoption of IFRS Sustainability Disclosure Standards — IFRS S1 and IFRS S2 — for companies listed on the Muscat Stock Exchange and other FSA-regulated entities.

Under the proposed roadmap:

Mandatory reporting is expected for annual periods beginning on or after January 1, 2029
Scope 3 greenhouse gas emission disclosures will become mandatory from January 1, 2030
The implementation will follow a phased approach to help businesses prepare their systems and governance frameworks.

This initiative supports Oman Vision 2040 and the country’s long-term sustainability and net-zero objectives.

Understanding IFRS S1 and IFRS S2

IFRS S1 – Sustainability-Related Financial Disclosures

IFRS S1 focuses on how sustainability-related risks and opportunities may impact a company’s financial performance, operations, and long-term value.

It requires businesses to disclose:

Sustainability-related risks
Governance practices
Risk management processes
Strategic impact on financial performance
Sustainability metrics and targets

IFRS S2 – Climate-Related Disclosures

IFRS S2 specifically addresses climate-related reporting requirements.

This includes:

Climate risks and opportunities
Carbon emissions reporting
Climate governance
Transition planning
Scenario analysis
Net-zero commitments

These standards are designed to provide investors and stakeholders with reliable, comparable, and decision-useful sustainability information.

Why This Matters for Businesses in Oman

The transition from voluntary ESG reporting to mandatory sustainability disclosures is more than just a regulatory update. It changes how businesses manage risk, governance, investor relations, and corporate strategy.

Key Business Impacts

1. Increased Regulatory Compliance Requirements

Companies will need structured sustainability reporting systems that align with international standards.

2. Greater Investor Confidence

Transparent ESG reporting improves credibility among investors, banks, and stakeholders.

3. Stronger Corporate Governance

Businesses will need stronger internal controls, improved data collection processes, and enhanced sustainability oversight.

4. Competitive Advantage

Organizations that prepare early can position themselves as responsible and future-ready businesses.

5. Improved Access to Global Markets

International investors increasingly prefer companies with reliable ESG disclosures and sustainability frameworks.

What Is Scope 3 Emissions Reporting?

One of the biggest future requirements under IFRS S2 is the disclosure of Scope 3 emissions.

Scope 3 emissions refer to indirect emissions generated across the company’s value chain, including:

Supplier activities
Transportation
Business travel
Product usage
Waste management

Because collecting this data can be complex, Oman’s FSA has provided additional preparation time until 2030.

How Companies Should Prepare Now

Although implementation deadlines may seem far away, businesses should start preparing early.

Recommended Action Steps

Conduct an ESG Gap Assessment

Evaluate your current sustainability reporting practices and identify missing areas.

Build Internal Reporting Systems

Develop processes for collecting and managing ESG-related data.

Strengthen Governance Structures

Assign sustainability responsibilities to leadership teams and boards.

Train Finance and Compliance, Teams

Ensure teams understand IFRS S1 and IFRS S2 requirements.

Develop a Sustainability Strategy

Create measurable ESG goals aligned with your business objectives.

Prepare for Climate Risk Reporting

Start tracking emissions, climate risks, and environmental performance indicators.

The Growing Importance of ESG Reporting in Oman

Sustainability reporting is no longer limited to environmental responsibility alone. It is becoming a critical part of financial transparency, investment decisions, and long-term business resilience.

Oman’s adoption of international sustainability disclosure standards demonstrates the country’s commitment to:

Enhancing market transparency
Attracting sustainable investment
Strengthening financial governance
Supporting climate accountability
Aligning with global reporting frameworks

Businesses that adapt early will be better positioned for future regulatory requirements and investor expectations.

How Al Nuha International Can Help

At Al Nuha International, we help businesses navigate evolving financial and regulatory requirements with confidence.

Our services can support your organization with:

ESG readiness assessments
IFRS sustainability reporting guidance
Internal control evaluation
Compliance advisory
Financial reporting support
Risk and governance consulting

As sustainability reporting becomes a mandatory business requirement, early preparation can reduce compliance risks and improve long-term business value.

Final Thoughts

Oman’s move toward mandatory sustainability disclosures represents a major transformation in corporate reporting. Companies that begin preparing today will gain a strategic advantage tomorrow.

The introduction of IFRS S1 and IFRS S2 is not just about compliance — it is about building transparent, resilient, and future-focused businesses in an increasingly sustainability-driven economy.

Organizations should use this transition period wisely to strengthen governance, improve reporting systems, and align with international best practices.

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