Analysis of the Environmental Pillar of the Environmental Social And Governance Principles in the Domestic Laws of Zambia

Abstract

Environmental, Social, and Governance (ESG) principles have emerged as a globally recognised framework for evaluating corporate sustainability and long-term accountability. The environmental pillar of ESG imposes obligations on corporate entities relating to environmental impact assessment, pollution control, climate-related risk management, greenhouse gas emissions reduction, and environmental disclosure. This research adopts a doctrinal legal method to examine the extent to which Zambia's environmental legal framework domesticates the environmental pillar of ESG principles, with particular reference to the Environmental Management Act No. 12 of 2011 and the Green Economy and Climate Change Act No. 18 of 2024. The research finds that the Companies Act No. 10 of 2017, as the primary instrument of corporate governance in Zambia, does not provide a legal foundation for corporate ESG environmental obligations, as its governance architecture is oriented exclusively toward shareholder value and financial accountability. The EMA domesticates several foundational ESG-related environmental obligations through its provisions on environmental impact assessment, pollution control, and environmental disclosure, but adopts a traditional command-and-control regulatory model that does not address board-level environmental governance, mandatory sustainability reporting, or climate-related financial disclosure. The GECCA marks a significant legislative advancement, introducing binding statutory obligations for greenhouse gas emissions governance, climate resilience planning, environmental disclosure, and director liability for climate-related non-compliance. However, key implementation mechanisms, the Integrated Measuring Reporting and Verification System, the Climate Change Fund, and the Climate Change Register, remain unoperationalised, directly undermining the Act's accountability and disclosure architecture. The research concludes that Zambia's environmental legal framework partially domesticates the environmental pillar of ESG principles, establishing a regulatory foundation for corporate environmental accountability while falling short of a comprehensive ESG governance framework. The research recommends the amendment of the Companies Act No. 10 of 2017 to impose board-level environmental governance obligations and mandatory environmental disclosures on companies in high-impact sectors, the urgent operationalisation of the GECCA's key institutional mechanisms, and the extension of mandatory ESG reporting obligations to unlisted companies in high-impact sectors beyond those currently listed on the Lusaka Securities Exchange