PwC report showcases GCC's role in global sustainability
In the midst of ongoing global discussions on sustainable finance, PwC Middle East’s latest report, Opportunities for the GCC to strengthen the sustainable finance ecosystem, underscores the GCC’s growing recognition of the pivotal role sustainable finance plays in advancing economic, social, and environmental goals. Saudi Arabia and the UAE are leading the region’s efforts in this field, while other GCC countries are also making strides to adapt quickly.
The PwC report examines progress in nine key areas that signify the status of sustainable finance strategies, sector definitions, standards, and programs—the essential policy tools for cultivating a thriving sustainable finance ecosystem. One significant development highlighted in the report is the substantial increase in green and sustainable bonds issuance, with the total value surpassing $8.5 billion in 2022, compared to just $605 million in 2021.
Philipp Lemmerz, Government and Public Sector Consulting Partner at PwC Middle East, said, “In the case of the GCC and the wider Middle East region, there is an increased vulnerability to climate change. We believe that promoting sustainable finance and fully integrating ESG factors into core (public and private sector) financial strategies are critical to adapt and mitigate the effects of climate change.”
According to Lemmerz, most of the GCC countries have adopted voluntary corporate sustainability reporting standards, and many GCC governments have announced sovereign sustainable bond programs, especially for green bonds and sukuk. Substantial progress is also underway in other areas of disclosure, taxonomy and governance.
Dr. Yahya Anouti, Partner at Strategy& Middle East and Sustainability Leader at PwC Middle East, added that the GCC’s embrace of sustainable finance not only drives local progress but also elevates its global role. Integrating ESG principles and aligning with climate goals fosters economic, social, and environmental growth, attracts international investments, and encourages sustainable business practices, benefiting both the region and the world.
GCC countries can achieve immense strategic benefits from accelerating the adoption of sustainable finance. This would help them to attract international investments by encouraging higher transparency and accountability in reporting financial decisions. Sustainable finance would also drive more sustainable business models by incentivising private companies to implement sustainable methods that reduce their environmental footprint and bolster social inclusion and development by providing access to financing for organisations rolling out socially responsible initiatives.