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 UAE Residents Wants Firms to Act Responsibly on ESG Issues

UAE Residents Wants Firms to Act Responsibly on ESG Issues

The expectations of the majority of the UAE residents are very high for businesses to act responsibly on environmental, social and governance (ESG) issues, the findings of a recent survey by SEC Newgate showed.

The Italy-headquartered SEC Newgate which has regional offices in Dubai and Riyadh, surveyed more than 14,300 people across 14 countries and territories as part of its fourth annual ESG Monitor report.

The survey findings showed that the vast majority of people in the UAE (84%) want companies to more clearly communicate what they are doing to improve their performance on the ESG issues.

SEC Newgate Group CEO Fiorenzo Tagliabue said that their report has found that corporate communication shortcomings were clear to see, with a large majority believing companies need to more clearly communicate what they are doing to improve their performance on ESG issues and address stakeholder needs.

Fiorenzo Tagliabue also said that compliance with ESG reporting standards is just a starting point, it ensures business meets its regulatory requirements, but it does not signify excellence or an ambitious plan to drive impact through corporate operations.

“Clearly, a considered approach is needed to overcome skepticism, with many not trusting what companies claim about ESG. Business is under intense scrutiny on ESG issues, but failing to act ambitiously and failing to be transparent about your plans and achievements on ESG issues poses a significant reputational risk,” Tagliabue added.

Prioritise Stakeholders

Among the UAE residents, 67% believe that companies should act in the best interests of all stakeholders rather than prioritising shareholders ahead of others. An overwhelming 87% of the UAE respondents were also of the view it was important to transition to renewable/clean energy sources and 85% wanted the companies to act decisively on climate change.

Of those interviewed, 90% of the UAE residents gave importance rating of 7 or more out of 10 for large businesses, and a similar rating (88%) for small to medium-sized businesses (SMBs). These expectations were higher than what global consumers are demanding of corporations.

These respondents concerned about broader social and environmental issues, and significantly, 97% said that the UAE was on the right track and they placed the Emirates in first place and much higher than the global average of 47%.

However, the UAE residents were optimistic and 83% strongly believe that performing well on ESG responsibilities doesn’t have to come at the expense of profitability.

SEC Newgate Middle East Founder and CEO Elena Gramatica said that people still see ESG issues as important to address. This is both a communication and operational challenge for businesses, so there is still more work to be done when it comes to ESG.

“However, there is great optimism in the UAE with people having a comprehensive understanding of ESG and the positive role that the government is playing and supporting corporations to be more accountable,” Gramatica added.

According to her, a considered approach is needed to overcome skepticism, with many not trusting what companies claim about ESG. Business is under intense scrutiny on ESG issues, but failing to act ambitiously and failing to be transparent about your plans and achievements on ESG issues poses a significant reputational risk.

Global Business Magazine

Global Business Magazine

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