Businesses That Support Social Development Deserve Tax Relief – Mnangagwa

The Ministry of Finance and Investment Promotion is crafting a new, wide-ranging Financial Sector Policy, and Deputy Minister David Kudakwashe Mnangagwa has called on private sector stakeholders to actively engage in the process—particularly in integrating Environmental, Social, and Governance (ESG) principles.

Speaking at an ESG Reporting Workshop hosted by Enviroedge Consulting and Seall Intelligence at the Management Training Bureau in Msasa, Harare, Mnangagwa emphasized that Zimbabwe must move toward aligning its ESG practices with global standards to boost investment potential and access sustainable finance.

“The Ministry is currently working on a comprehensive financial sector policy, which offers a critical opportunity to embed ESG issues meaningfully,” he said. “It’s the private sector that must champion this integration.”

Mnangagwa noted that Zimbabwe and many African nations already practice sustainable development within communities—but often informally. To benefit from international green finance and investment opportunities, these efforts must be captured in formal policy frameworks and standardized reporting mechanisms that meet global expectations.

“This isn’t about surface-level compliance. We’re already taking action on the ground. The challenge is to structure and present it in a way that aligns with global reporting frameworks so we can access the capital that’s out there,” he said.

He stressed that companies need to go beyond implementing ESG initiatives and begin documenting their efforts through credible, audited reports if they wish to attract international capital. Doing so, he added, would ease the government’s financial burden in key areas like health, education, and environmental protection.

The Deputy Minister also proposed that companies investing in social and environmental outcomes could be rewarded—potentially through tax breaks or other incentives.

“If a company is taking on responsibilities that the government would typically finance, that contribution should be acknowledged—possibly through tax relief. But it must be tied to clearly documented outcomes,” Mnangagwa said.

He urged businesses to put forward real-world models that show how their ESG practices support national development priorities, especially in sectors like public health, ecological restoration, and local infrastructure.

“There’s always tension between government wanting to maximize tax collection and companies carrying out public-interest projects. But if businesses are genuinely helping meet social needs, there must be a mechanism to reflect that contribution,” he said.

Mnangagwa also cautioned against superficial ESG compliance, emphasizing that Zimbabwe must create a solid, transparent ecosystem where ESG practices are monitored, enforced, and trusted by international investors.

“When global assessors look at Zimbabwe, they need to be assured that our policies are not just on paper—and that reports from our companies reflect genuine, verified actions,” he said.

While acknowledging the high costs of ESG adoption—including staffing, systems, and operational changes—Mnangagwa encouraged businesses to see ESG as a strategic opportunity to share in the country’s development burden, especially in areas where the state is under-resourced.

He concluded by stressing that any ESG framework developed without private sector input risks being ineffective.

“If the government drafts regulations in isolation, we might roll out a Statutory Instrument tomorrow—but will it be practical or impactful? That’s why this dialogue matters,” Mnangagwa said.