Kenya

Kenya implements a national green economy planning framework through the Green Economy Strategy and Implementation Plan (GESIP) 2016–2030, which sets out a cross-sector approach for transitioning to a low-carbon, resource-efficient and socially inclusive development pathway, and is designed to be integrated with national development planning frameworks. In parallel, Kenya’s climate governance framework operationalises economy-wide planning through the Climate Change Act (2016, amended in 2023), which requires the government to prepare and update five-year National Climate Change Action Plans (NCCAPs) and mandates integration of climate actions into public planning and decision-making; the current cycle, NCCAP III 2023–2027, provides a detailed and operational set of priority actions across sectors and levels of government, aligned with Kenya’s NDC.

However, while Kenya has strengthened the long-term policy direction by launching a Long-Term Low Emission Development Strategy (LT-LEDS) for 2022–2050 with a net-zero orientation by 2050, and has continued to update its NDCs (the newest 2025 NDC covering 2031–2035), the overall green economy planning framework remains somewhat fragmented across multiple instruments with uneven legal force and varying levels of detail. In particular, the GESIP is not a single green economy plan with specific intermediate targets and a legally binding implementation framework across the entire economy; instead, legally binding elements are strongest in the climate-planning architecture (NCCAPs) rather than in a dedicated green economy plan for a 2050 net-zero transition. Kenya’s 2031–2035 NDC explicitly flags fragmentation risks and stresses the need for a whole-of-government approach.

While planning is well established and publicly accessible, implementation remains constrained by challenges related to financing and monitoring, reporting and verification capacity. In addition, the development of a fully costed, whole-of-economy net-zero pathway could further strengthen coherence and support more effective implementation of the overall framework.

Kenya has established foundations for inclusive corporate governance through a combination of constitutional mandates, statutory laws and sectoral regulatory codes. The 2010 Constitution and the Companies Act 2015 provide the primary legal framework, while key governance standards are set through the Capital Markets Authority (CMA) Code of Corporate Governance Practices for Issuers of Securities to the Public and Mwongozo (the Code of Governance for State Corporations). These frameworks promote transparency, accountability, risk management and stakeholder considerations, particularly within listed companies and state-owned enterprises.

Kenya is frequently cited among Africa’s leaders in female board representation (often reported around 20% in corporate board datasets, and higher in some audits of listed entities). This progress is supported by “comply or explain” provisions rather than strict mandatory quotas for the private sector. The Nairobi Securities Exchange ESG Disclosures Guidance Manual (2021) further provides a framework for companies to report on social factors including gender diversity and employee engagement.

Despite these accomplishments, the governance landscape remains characterized by a concentration of requirements within issuers and state corporations, with coverage across the wider private sector remaining limited. Inclusion and ESG-related provisions are largely voluntary outside these segments, and there are no consistent mandatory requirements for employee involvement in decision-making processes. While the 2025 Government Owned Enterprises Act has significantly professionalized state-owned enterprises by mandating merit-based, independent board appointments, these stricter standards do not yet extend to the broader private economy. National strategies, such as the National Financial Inclusion Strategy (2025–2028), champion ESG alignment with UN SDGs, but the transition from voluntary reporting to mandatory performance targets for gender and employee representation remains incomplete, keeping the overall framework below the level of a comprehensive national strategy.

Kenya’s Constitution embeds public participation as a national value, with Articles 10 and 118 requiring Parliament and County Assemblies to facilitate public involvement in legislative and policy processes. In practice, public participation guidance and procedures are applied across different levels of government, and courts have played an active role in reinforcing these requirements where processes have been deemed inadequate.

The enactment process of the Public Participation Bill 2024—alongside proposals for further legislation in 2025—aims to standardize participation procedures and institutional arrangements, including the establishment of an Office of the Registrar of Public Participation to oversee and review participation plans from “responsible authorities” at national and county levels. The proposed framework includes requirements for stakeholder analysis, accessibility for people with disabilities, and consideration of socioeconomic and ethnic factors in consultations. In parallel, instruments such as the Persons with Disabilities Act 2025 and Regulatory Impact Statement requirements for new regulations (e.g. the 2025 National Qualifications Framework) signal a growing emphasis on assessing impacts on marginalized groups.

However, as of 2025, the Public Participation Bill remains in the legislative process and is not yet fully operational, meaning that standardization across institutions is still evolving. While the legal mandate for participation is well established, implementation quality remains uneven. Judicial challenges and civil society reports continue to highlight that consultations can be perceived as “pro-forma”, particularly for high-stakes economic legislation such as Finance Bills or constitutional amendments. In addition, barriers persist in reaching hard-to-reach and marginalized groups, including limitations linked to the digital divide, and there is not yet consistent practice in providing feedback on how public inputs are incorporated into final decisions. Overall, while the framework for mandatory consultation is in place and strengthening, it has not yet achieved uniform or fully effective implementation across all contexts.

Via the Kenya National Bureau of Statistics (KNBS), Kenya has been developing accounts aligned with the System of Environmental-Economic Accounting (SEEA), including energy accounts that began as pilots and then moved into regular production, with further work expanding into additional accounts such as water and monetary energy accounts. Kenya has also produced and piloted natural capital accounts (e.g. forest accounts under the WAVES partnership), demonstrating a progressive shift towards integrating environmental data into national statistics. In 2025, this direction was formalized through the National Plan for Advancing Environmental-Economic Accounting (NP-AEEA) 2025–2028, which serves as a roadmap for embedding SEEA within Kenya’s statistical and policy frameworks and for developing accounts across land, water, forests, ecosystems, energy and minerals.

There is also emerging evidence of policy uptake: Kenya’s National Treasury references the NP-AEEA and the prioritization of natural accounts data, and describes collaboration with the World Bank to “green” a macroeconomic model using these datasets, signaling that such non-GDP indicators are beginning to inform macroeconomic analysis. However, the framework remains focused primarily on environmental and natural capital accounts.

Since 2021, the Central Bank of Kenya (CBK) has required banks licensed under the Banking Act to integrate climate-related financial risks into governance and risk management, supported by its Guidance on Climate-Related Risk Management, which also requires institutions to develop board-approved implementation plans and report progress to the regulator. In 2025, CBK further strengthened this framework by issuing the Kenya Green Finance Taxonomy, designed to classify environmentally sustainable activities and guide capital allocation towards climate-aligned investments. In parallel, the development of a Climate Risk Disclosure Framework signals a move towards more standardised and comparable climate-related disclosures, aligned with international approaches such as IFRS S2 and Basel climate-risk principles. These measures are supported by ongoing technical assistance and phased implementation, including testing periods for banks, to embed climate considerations into supervisory practice.

However, while Kenya has made progress in integrating climate risk into banking supervision and in developing enabling tools, comprehensive mandatory disclosure requirements across the sector are still evolving, and climate stress-testing is not systematically implemented at scale. Existing Central Bank financial stability stress tests continue to focus primarily on conventional prudential risks rather than fully incorporating climate scenarios. In addition, Kenya has not yet introduced measures that explicitly penalise or restrict fossil fuel-related financial activities.

In April 2025, the Central Bank of Kenya (CBK) issued the first edition of the Kenya Green Finance Taxonomy and advanced a Climate Risk Disclosure Framework for the banking sector, building on its earlier supervisory guidance on climate-related risk management. The taxonomy provides a standardized classification system for identifying environmentally sustainable economic activities across key sectors such as agriculture, energy and manufacturing, helping to curb greenwashing and guide capital allocation toward low-carbon investments. While elements of the disclosure framework and taxonomy are being introduced through a phased approach, with an initial voluntary/testing period, they signal a clear move towards more formalised and potentially mandatory requirements over time.

On the fiscal side, the government has progressed from the draft stage of the National Green Fiscal Incentives Policy Framework towards implementation, with measures reflected in the Finance Act 2025. These include targeted tax reforms such as reduced import duties for electric vehicle components and VAT exemptions for selected green technologies to stimulate private investment. In parallel, the National Treasury has introduced climate budget tagging approaches and integrated green considerations into key planning instruments such as the 2025 Budget Review and Outlook Paper, aligning public spending with the Bottom-Up Economic Transformation Agenda and the Fourth Medium Term Plan (MTP IV), which prioritise climate-resilient infrastructure.

Overall, these developments indicate a clear policy direction and increasing institutionalisation of green fiscal and monetary tools. However, several measures remain in transition.

As of 2025, the country’s trade policy landscape is carachterized by agreements that explicitly include green priorities. A landmark example is the European Union-Kenya Economic Partnership Agreement, which entered into force in 2024 and features a dedicated, enforceable Trade and Sustainable Development chapter. This chapter commits both parties to the Paris Agreement, labor rights and biodiversity conservation. Furthermore, the 2025-2030 Kenya-UK Strategic Partnership and the ongoing negotiations for the Kenya-US Strategic Trade and Investment Partnership highlight green growth and climate-resilient infrastructure as core pillars. Domestically, Kenya has advanced work in the technical interoperability of green finance. In 2025, the Central Bank of Kenya finalized the Kenya Green Finance Taxonomy and a climate risk disclosure framework, designed to align the financial sector with international standards. Additionally, the Finance Act 2025 introduced targeted fiscal measures to support e-mobility and selected green technologies, including adjustments to VAT and import-related tax treatment. However, the score is tempered by significant implementation challenges. In 2025, the East African Court of Justice issued an interim injunction halting the implementation of the EU-Kenya EPA following legal challenges regarding its compatibility with regional East African Community protocols. Moreover, Kenya is well positioned regarding African carbon markets. Having launched a national REDD+ Registry and established carbon trading regulations, these systems are not yet fully integrated into multilateral trade pacts or wider carbon pricing regimes. However, the integration of enforceable “green trade” instruments remains partial (e.g., limited binding environmental provisions tied to trade incentives and limited economy‑wide standards/adjustment measures for low‑carbon competitiveness).

The Climate Change (Amendment) Act of 2023 introduced a framework for carbon markets and provided the Cabinet Secretary with the authority to set carbon budgets. This progress was further solidified in 2024 and throughout 2025 with the Climate Change (Carbon Markets) Regulations and the National Carbon Registry. These instruments create a regulated environment for both voluntary and compliance carbon markets. The introduction of the "40% Rule" for land-based projects and the "25% Rule" for non-land-based projects ensures that carbon trading includes mandatory benefit-sharing with local communities, highlighting a focus on social equity within the pricing mechanism. Despite these developments in carbon trading and registry, Kenya has not yet implemented a national carbon tax, and its carbon budgeting process remains largely administrative and non-binding in a legal sense. The country’s updated NDC, submitted in 2025, commits to a 35% emission reduction relative to business-as-usual, but there is no link between this target and a 1.5°C aligned carbon budget. The current focus is scaling the carbon credit market and finalizing the digital registry rather than enforcing a domestic carbon price across all industrial sectors.

The 2016 Green Economy Strategy and Implementation Plan provides an economy-wide transition framework spanning infrastructure, natural resources, resilience, resource efficiency and social inclusion, but it functions primarily as a strategic guide rather than as a cross-sector commissioning body with enforcement powers. Kenya’s Climate Change Act (2016, as amended in 2023) establishes a formal governance structure for mainstreaming climate action into sector functions through five-year National Climate Change Action Plans (NCCAPs), overseen by the National Climate Change Council and operationally coordinated by the Climate Change Directorate, including measurement, reporting and verification functions and support to sector ministries and counties.The current NCCAP 2023–2027 is explicitly cross-sector, setting priority actions across mitigation and adaptation and covering major parts of the economy (energy, transport, agriculture/land and waste included). However, the strength of sectoral ambition, policy coherence, resourcing and monitoring remains uneven in practice, with coordination often mediated through climate-planning processes rather than through a single independent green-economy planning commission with strong authority to develop and drive low-carbon sector plans.

Kenya does not have a circular economy roadmap or action plan that sets ambitious standards for reuse, circular public procurement, consumer “repair” rights and a clear target for increasing the circular material use rate (CMUR). Kenyan government communications indicate that a national circular economy strategy is being developed to consolidate currently fragmented circularity policies, which implies the unified framework is still in preparation. At the same time, Kenya has put in place several building blocks that are consistent with circularity, particularly through the waste and materials policy space. The Sustainable Waste Management Act (2022) embeds circular economy concepts, including a waste hierarchy that prioritises avoidance, reduction, reuse, repair, refurbishment, recycling and recovery, and it provides a basis for measures such as take-back schemes and extended producer responsibility (EPR).

The Government has initiated a National Electric Mobility Policy process through a taskforce and published a Draft National E-Mobility Policy (2024) that explicitly commits to setting transition timelines for when all new vehicle registrations must be zero-emission (with differentiated timelines by vehicle category), introduces the intention to establish vehicle emissions standards with periodic inspections, and requires building codes and regulations to accommodate EV charging infrastructure, alongside measures to support electric mass passenger transport systems in urban areas. In parallel, Kenya has begun using fiscal and regulatory levers that can accelerate uptake, including publicised tax treatment and investment positioning around e-mobility. On public transport, Nairobi’s bus rapid transit programme has been explicitly linked to electrification ambitions in externally financed planning for at least one corridor, signalling investment intent in electrified mass transit. Nonetheless, Kenya’s environmental standards for the wider vehicle fleet are quite partial: restrictions like the long-standing age limit on used vehicle imports help constrain the worst-performing imports, but this is not equivalent to a CO2-based vehicle standard regime across the whole market.

Kenya has a strong clean‑energy enabling framework (including the Energy Act 2019) and has advanced energy transition planning (e.g., Energy Transition and Investment Plan). It has emerged as a leader in clean energy among developing countries, with renewable sources (geothermal, hydro, wind and solar) now constituting roughly 85-90% of its electricity generation. The government has set an ambitious target of reaching 100% clean electricity generation by 2030, and plans to expand generation capacity. Kenya is operationalizing a Renewable Energy Auction Policy alongside other measures (such as open access regulations) to attract investment and ensure transparent, cost-effective deployment of renewables. Beyond the power sector, Kenya also aims for universal access to modern clean cooking by 2030 (up from only about 34% of households today), addressing its heavy reliance on traditional biomass fuels. The transport sector remains dominated by fossil fuels, but there are steps toward electrification. For example, the government has introduced incentives for electric vehicles and has set a goal for 5% of new vehicle registrations to be electric by 2025.

Kenya is implementing its National Strategy on Green Skills and Green Jobs (launched in 2024), which was recently refined with support from the International Labour Organization. This strategy provides a multi-sectoral framework that explicitly links climate action with employability, targeting sectors such as renewable energy, sustainable agriculture and e-mobility. The framework is notable for its integration of green competencies into the national education system, specifically through the Competence-Based Education and Training curriculum in Technical and Vocational Education and Training institutions. Furthermore, the National Energy Policy 2025–2034 and the Draft National Green Fiscal Incentives Policy Framework demonstrate a commitment to using fiscal mechanisms to attract private investment into green sectors. Initiatives like the Green Careers Caravan reach university students and the Energy Transition and Investment Plan outlines pathways for decarbonization that consider workforce shifts. However, the transition planning for workers in brown sectors (such as traditional charcoal production or fossil-fuel transport) remains at an early stage.

Kenya increasingly references just transition in national policy documents. It has advanced a national just transition framework/process through a Just Transition Platform launched in 2025, with multi-stakeholder dialogues involving government representatives, trade unions and civil society. It aims to inform the integration of ‘decent work’ and social justice principles into the country's NDCs and sectoral plans. Furthermore, the government has operationalized the Kenya Energy Transition and Investment Plan, which provides a roadmap for reaching Net Zero while estimating the creation of 500.000 green jobs by 2050, with a focus on solar PV and electric vehicle infrastructure. The National Energy Policy 2025-2034 and the National Energy Compact 2025-2030 prioritize "universal access to clean cooking and electricity by 2030" as a social measure to alleviate the burden on the 69% of households currently relying on traditional biomass. While the framework is advanced, disparities in implementation and inequality persist; some communities have also reported that they lack meaningful participation in the design of localized actions.

The Micro and Small Enterprises Act (2012) establishes an enabling framework for promotion, development and regulation of micro and small enterprises, and the State Department/MSEA ecosystem supports broad capacity-building and financing interventions, while the 2025 draft MSME policy positions the sector as “productive, competitive and sustainable”. However, these measures are general MSME enablers rather than dedicated schemes for green business models.The National Financial Inclusion Strategy 2025-2028 supports green finance practices within the financial sector. On social enterprises, Kenya does not have a dedicated social enterprise form.

Kenya has established social protection policies and institutions, including the Kenya Social Protection Policy (2023) and legal frameworks for social assistance. Under the Bottom-Up Economic Transformation Agenda, programmes such as the National Safety Net Programme and the Second Kenya Social and Economic Inclusion Project have expanded “cash-plus” interventions, combining income support with livelihoods promotion, financial inclusion and responses to climate risks, particularly droughts. But Kenya does not use social protection as a vehicle for broad participation in the green economy through instruments such as green job guarantees or community ownership. Some innovations such as GiveDirectly’s universal basic income pilots remain outside the government. Most state programmes are framed primarily around poverty reduction and resilience rather than as tools for green economic transformation.

Kenya is making progress to align with the Kunming-Montreal Global Biodiversity Framework. As of 2025, the country has an updated National Biodiversity Strategy and Action Plan 2019-2030 in line with the post-2015 SDG agenda, and is currently undergoing a process to update and align its NBSAP more closely with the Kunming–Montreal Global Biodiversity Framework. Kenya is also using a global support network (NBSAP Accelerator Partnership) to access technical advice, scientific knowledge and solutions, to put its NBSAP into action.

An estimated 42% of Kenya's GDP and 70% of employment is generated by sectors that depend directly on natural capital and ecosystem services, like tourism and agriculture. Current NBSAP vows to reduce the rate of loss for natural habitats to near zero and increase total forest cover to at least 10%; also to expand conservation to cover at least 17% of terrestrial water areas and 10% of coastal and marine areas, integrated into national protected zones. Government officials have made statements of intent to expand marine protection toward 30% by 2030, and it has continued to advance blue economy planning instruments, including marine spatial planning. However, internationally compiled protected-area statistics suggest current coverage remains well below “30x30” levels, particularly for marine areas.

Kenya is working on a plan to track the value of its natural resources through the System of Environmental-Economic Accounting (SEEA), but the process is still in its early stages. While the government has a roadmap and there is technical work on priority accounts, it has not yet released regularly updated data. Additionally, Kenya lacks an independent expert body to ensure the data is actually used to guide national budgets and planning. Kenya’s 2025-2028 National Plan for Advancing Environmental-Economic Accounting (2025) sets out the strategy to integrate SEEA into Kenya’s statistical and policy frameworks and prioritizes different account types, but progress on compilation is partial. Recent program reporting describes the development of experimental outputs such as water supply, ecosystem extent/condition reporting, energy and minerals tables and work on forest asset accounts.

Kenya has several strategies supporting sustainable agriculture and food systems, including the Kenya Food Systems and Land Use Action Plan (2024–2030), the Climate Smart Agriculture Strategy (2017–2026), the Agricultural Sector Transformation and Growth Strategy (2019–2029) and the National Agroecology Strategy for Food System Transformation (2024–2033). The Kenya Food Systems and Land Use Action Plan 2024–2030 (2023) frames national priorities around healthy diets, productive and regenerative agriculture, reducing food loss and waste, and protecting and restoring nature, and it sets out an implementation and coordination approach across national and county levels. In parallel, the National Agroecology Strategy for Food System Transformation 2024–2033 (2024) reinforces a nature-positive production pathway and provides an additional strategic compass for regenerative agroecology. However, harmful subsidy reform and ecological-footprint targeting is insufficiently referenced. In practice, Kenya has continued to rely heavily on input subsidies (notably fertilizer), with reform efforts focusing more on administration and financing than on phase-out or redirection, and recent public reporting continued to centre on scaling and managing the subsidy programme.

Kenya's Environmental Management and Co-ordination Act explicitly refers to the polluter-pays principle, and it is increasingly using fiscal and regulatory instruments that can price environmental harm and shift behaviour, such as the Eco Levy measures introduced through the Finance Bill 2024 framework and the tightening of producer responsibility rules for waste and packaging through the National Environment Management Authority’s extended producer responsibility regime. Kenya also has some foundations for nature finance through policy and institutional instruments, including the National Environment Policy (2013), which supports fiscal incentives and funding for environmental management, and the Public Finance Management (Wildlife Conservation Trust Fund) Regulations, 2023. The country has some nature-positive finance channels that can benefit local communities, including expanding and professionalising community conservancy finance and revenue flows linked to nature-based value chains, and it has taken steps to operationalise a Wildlife Conservation Trust Fund. However, Kenya’s instruments are fragmented. A comprehensive national nature-finance strategy—covering clear instruments, safeguards, measurable biodiversity outcomes and reform of harmful incentives—is not in place, and environmentally harmful subsidies and incentives persist.

Kenya’s immediate COVID-19 stabilisation response and early recovery planning did incorporate some green recovery intent, primarily through the government’s Post-COVID-19 Economic Recovery Strategy (2020), which explicitly framed part of the recovery as “clean, green and resilient growth” linked to climate adaptation, mitigation and green jobs. But at the level of implemented instruments, the largest stimulus measures were oriented toward short-term employment, basic public works, MSME liquidity support and social protection, with limited, indirect environmental components. International support for a resilient recovery in Kenya has included policy reforms framed around green energy and natural-capital governance, but without strong conditionality. By 2024 and 2025, Kenya’s fiscal constraints have limited large-scale recovery spending.