Environmental, social and governance (ESG) considerations have become a significant part of the investment landscape in the Middle East region. It is a result of collaboration between governments, regulatory bodies, businesses and investors. In the United Arab Emirates, 2023 was named Sustainability Year. The efforts to raise environmental awareness are now more visible than ever. The UAE Net Zero 2050 Strategic Initiative is consistent with the country’s vision to be a significant contributor to global sustainability efforts, while at the same time supporting economic growth and human development. The UAE will bring the world together during the United Nations Climate Change Conference, or COP28, in November 2023 for a common mission against climate change.
In January this year, Abu Dhabi Sustainable Week was held under the patronage of the UAE President, His Highness Sheikh Mohamed bin Zayed Al Nahyan. The conference not only covered a spectrum of topics around net zero, transformative technology and responsible investing but also supported the signing of a series of landmark agreements to foster a climate actions framework. Abu Dhabi Sustainable Week hosted 36,000 participants from 175 countries.
Taking a closer look at the financial industry and the promotion of sustainable investing, environmental awareness is visible across companies’ strategies. It all starts with the hiring and recruitment process. Today, searching for the phrase “sustainability” in one of the leading professional platforms shows more than 650 matching job offers. Teams across the industry are building ESG strategies and frameworks to comply with regulatory requirements on ESG reporting.
ESG is one of the pillars of public policy and strategic planning for governments, and on a global level, is a part of the United Nations Sustainable Development Goals (UNSDG). In Europe, in 2018 the European Commission published the Action Plan for Financing Sustainable Growth. One of the areas of focus is fostering transparency.
The Sustainable Finance Disclosure Regulation (SFDR) is a European regulation aimed at improving transparency in the market for sustainable investment products, addressing greenwashing and enhancing transparency on sustainability claims made by market participants. It introduces sustainability disclosure requirements.
Similarly, the UAE introduced a framework to drive sustainability forward under the framework of UAE Vision 2021 and in alignment with the UNSDG. The Abu Dhabi Vision 2030 also underlines the importance of sustainability. In 2019, the Securities and Commodities Authority (SCA) issued the Master Plan for Sustainable Capital Markets, of which the fifth pillar, ”Transparency and disclosure,” introduces additional reporting obligations on listed companies, including non-financial data and suitability reports. The SCA will also be working with other regulators to implement two sets of requirements on asset managers and institutional investors that exceed a certain value of assets under management. These requirements include requiring the integration of sustainability factors in investment analysis and decision-making processes, and disclosures on how they integrate sustainability factors in their processes. The Abu Dhabi Securities Exchange (ADX) has issued its sustainability report for its listed companies, which must disclose their sustainability reports compulsorily according to the governance rules issued by the SCA.
The Abu Dhabi Global Market (ADGM), the international financial center in Abu Dhabi, announced its Sustainable Finance Agenda Declaration at the inaugural Abu Dhabi Sustainable Finance Forum (ADSFF), acknowledging a commitment to integrating green and sustainable finance. As a founding member of the ”One Planet Sovereign Wealth Fund Working Group” Sovereign Wealth Fund, Abu Dhabi Investment Authority (ADIA) has also demonstrated its commitment to integrating ESG factors into investment decisions.
An increasing number of investors have started to integrate ESG factors into their investment portfolios and investment decisions, and those investors express confidence that analysis of ESG metrics provides valuable insights into a company, and therefore contributes to making better-informed investment decisions.
SS&C can help you realize your vision for ESG report production and engagement. SS&C helps managers meet the ESG reporting demands of investors and regulators by collecting, managing and reporting ESG data for them.
SS&C’s end-to-end ESG reporting platform helps provide insight for managers and transparency for investors into the ESG profile of their portfolios. Through the ability to consume third-party data from leading ESG data providers and institutional investors, SS&C offers investment managers a range of solutions that include ESG monitoring, reporting and regulatory compliance.
Partnering with SS&C enables you to:
- Work with SS&C’s dedicated design team on your preferred reporting layouts.
- Select which ESG factors and portfolio metrics are important to you and your organization.
- Dictate the level of granularity required and engage appropriately.
- Decide on your own required reporting frequency.
- Robustly join additional data sources.
- Schedule report deliveries.
Join our "Are You Capitalizing on LP’s ESG Themes when Fundraising?" webinar to learn more about ESG investing and compliance.
