2024 marks a break through for sustainability in the GCC, PwC report

 PwC Middle East’s recent sustainability report reveals that companies in the Middle East are increasingly making sustainability a priority in their corporate agenda. Four in five executives (79%) stated that they now have a formal sustainability strategy in place, with over half of them (52%) fully embedding it across their organisation. The survey further highlights the growing trend of companies creating top-level positions, such as chief sustainability officer (CSO) or sustainability director roles. Notably, 48% of respondents indicate their companies either have a CSO or plan to appoint one in the next 12 months. 

Commenting on the findings, Dr. Yahya Anouti, PwC Middle East Sustainability leader, said: “Businesses and government leaders in the Middle East are increasingly committed to tackling the climate crisis and adopting circular economy principles. Leveraging our region’s competitive advantage in renewable energy is key. Both governments and the private sector must collectively continue prioritising responsible investments and embrace advanced technologies to drive innovative climate solutions. It’s crucial for business leaders to understand that sustainability actions can not only generate a return on investment but also boost profitability.”

With sustainability rising higher on the C-suite agenda, there is also a wider adoption of net-zero greenhouse gas emission targets, with half of all respondents stating that they have made a net-zero commitment, with an additional 26% working toward making such a commitment.

Emphasising the need for tangible actions, Stephen Anderson, PwC Middle East Strategy Leader, said: “This year’s sustainability report highlights that the region’s business leaders are reacting positively to the growing pressure from regulators and society to show progress on the sustainability front. Yet concerns about the potential costs and the perceived low returns of sustainable investments persist, despite evidence suggesting otherwise. Advancing the sustainability agenda will require focused and strategic improvements to ensure ongoing and intensified efforts, transforming climate discussions into tangible actions.”

Creating a talent pipeline for the future requires raising existing skill levels and employing diverse talent, essential for sustainability strategies - with 79% of executives citing knowledge of sustainability reporting and regulations as a key requirement. More future-focused skills are also crucial for technology adoption, like Generative AI (GenAI), which can enhance sustainability efforts. However, responses to the survey reveal that AI deployment is still in its early stages, with respondents mainly using it to enhance existing capabilities, such as data analysis and insights (48%) or reporting (45%), rather than optimising supply chains or developing circular economy models.

Tapping into new sources of funding has been one of the critical breakthroughs over the past year. Respondents in this year’s survey are looking to access a greater variety of financing opportunities and mechanisms. Self-funding remains the most common green finance source, while 34% reveal that they would opt for green loans, and an equal number (33%) considering capital markets (for example, green or blue bonds) as part of their financing options.

The private sector is a catalyst for action, with sustainability leaders surveyed indicating that there is a clear appetite and opportunity for the private sector to drive the region’s sustainability agenda. The survey shows that nearly 9 out of 10 leaders believe that the private sector can play a role in scaling the region’s sustainability commitment through collaboration, partnerships and alliances.

Anderson concludes: “In order for the momentum on the sustainability agenda to continue, we foresee four key areas of focus for sustainability leaders in the Middle East. These include upskilling the workforce, strengthening infrastructure in areas such as the circular economy, creating standardised sustainability regulations, and enabling funding for sustainable development.”

PwC’s third Middle East Sustainability survey was conducted between 1 April and 6 May 2024, capturing insights from C-suite and director-level executives involved in sustainability activities within their organisation. Most participants were from organisations headquartered in the GCC region, in particular the UAE, Saudi Arabia and Qatar, with 64% having revenues exceeding $100 million in a broad range of sectors.