Zimbabwe’s fragmented ESG laws create compliance burden for companies, legal expert warns

Top lawyer Vengai Madzima has raised concerns over the lack of unified Environmental, Social and Governance (ESG) legislation in Zimbabwe, warning that the fragmented framework could create burdensome compliance requirements for companies. ESG is a framework used by investors and companies to evaluate an organisation’s business practices and performance on sustainability and ethical issues. It assesses compliance in areas including environmental protection, social impact on communities and internal corporate controls.

Speaking during a plenary discussion at the ZimReal 2026 Conference, Madzima, a Senior Partner at MCM Legal, said Zimbabwe’s ESG legislation was drawn from multiple sources, creating a fragmented regulatory framework. “That’s legislation, regulatory provisions and sometimes even in contracts. So broadly speaking, our constitution, I think it’s section 73, guarantees environmental rights.

If we go down with the same E, we have the Environmental Management Act, which broadly deals with environmental issues. “But if it’s a property company per se, we have the Environmental Impact Assessment and Ecosystems Protection Regulations,” he said. Madzima said the regulations provide for environmental considerations to be addressed, particularly at the pre-development stage.

He said certificates issued in some instances could also contain provisions requiring developers to comply with specific environmental requirements at different stages of a project. On the social and governance aspects of ESG, the legal expert said the Companies and Other Business Entities Act mainly addresses governance issues involving directors of private and public companies. He said Section 54 deals with directors in private companies, while Section 195 covers directors of public companies.

Madzima said Section 195(1) to (5) essentially deals with directors’ duties towards shareholders, stakeholders and suppliers, while subsection 5 specifically addresses social and environmental issues. However, he said these provisions were largely focused on compliance and did not necessarily translate into broader requirements for investor readiness. The legal expert said property companies intending to list on the Zimbabwe Stock Exchange would also become subject to ZSE rules governing ESG requirements.

The rules require the chairman to comment on ESG issues in …