The UAE witnessed a 32 percent year-on-year (YoY) growth in its 2022 green and sustainable finance issuing, a new report by leading consulting firm Arthur D. Little showed.
Between 2019 and 2022, the UAE recorded increasing environmental, social, and corporate governance (ESG) reporting across major public and private institutions such as Dubai Financial Market, Ministry of Climate Change and Environment and publicly listed companies in Securities and Commodities Authority (SCA).
Published under the title “Middle East Banks drive growth in ESG finance, face calls for ESG strategy,” Arthur D. Little offers a two-part tailored and scalable solution for complex data to enable banks to efficiently manage ESG information in the UAE. The Viewpoint reviews the impacts of recent and expected disruptions, and explores options for banks to strengthen and grow their ESG strategies.
Financial institutions in the Middle East and North Africa (MENA) have adopted ESG as a key strategic element in their commitment to going green. As more reporting requirements become mandatory, and stakeholders determine the need for a comprehensive approach to ESG, these institutions have responded by shifting their focus from defining an ESG strategy to implementing it, with data governance playing a key role.
An impressive US$24.55 billion in green and sustainable finance was generated by the MENA region in 2021, an increase from US$3.8 billion in 2020, achieving an extraordinary 532 percent YoY growth.
Led by First Abu Dhabi Bank, Majid Al Futtaim’s fundraiser gathered US$1.25 billion in 2022 as the credit facility linked to the company’s ESG goals. Further, Dubai Islamic Bank is currently in progress of concluding its own reporting, spanning ethics and integrity, thriving workplace, positive community impact, environmental stewardship, and sustainable finance and investments.
So far, financial institutions in the UAE are continuing to embrace ESG, which is gaining momentum and wide-reaching acceptance. A well-developed, thoughtful approach that considers the framework outlined in ADL’s latest Viewpoint can create the conditions for future success.
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