UAE businesses face growing demand for ESG action, landmark survey reveals
- New survey shows sharp increase in public interest in environmental, social and governance (ESG) issues
- Strong community expectations in the UAE make genuine ESG action by organisations imperative
- ESG performance ratings of the national government remain strong
- Community wants companies to communicate their ESG efforts more clearly
Dubai, Wednesday 11 October 2023 – A landmark survey revealed the continued strength of community expectations for environmental, social and governance (ESG) action among UAE corporations. Globally, business leaders are warned that public expectations for authentic action on ESG issues remain high in the face of cost-of-living pressures, and inaction — combined with silence about their efforts — could cost them customers.
The findings come as part of the third annual ESG Monitor, a 12-nation survey led by SEC Newgate*, the global strategic communications, advocacy and research group, with regional office in Dubai.
Over 90% of UAE respondents agree that corporates must prioritise ESG issues, indicating a shift from a sole focus on economic contributions. The research shows that we may have reached a tipping point, suggesting that the need for genuine action by corporations to address the impacts they have on people and the planet is no longer up for debate.
Some of the main UAE findings include:
- 86% rate their interest in ESG issues as high at 7+ out of 10, up by 3% since last year;
- 61% are aware of NetZero, a significant increase from just 56% in 2022;
- 86% gave the national government a rating of 7+ out of 10 when it came to acting responsibly on ESG issues; however, ratings of small companies have declined significantly this year;
The research shows that community opinions on ESG issues are translating into action and impacting behaviours. Compared to other countries, citizens in the UAE appear to place a higher importance on ESG issues in their day-to-day decision making. In particular, in the types of foods they eat (77% vs. 62% globally), the types of products they buy (76% vs. 62%), and how they choose to travel (74% vs. 55%).
There is a stark difference by generation across all surveyed countries, with Millennials far more likely to factor ESG issues into their decisions. For example, when it comes to the type of investments they make, 57% of Millennials rate ESG issues 7+ out of 10 on importance, compared to 47% of Baby Boomers. When considering a job with a new employer, 58% of Millennials give ESG issues a 7+ importance rating compared to 39% of Baby Boomers.
Speaking on the findings, Elena Gramatica, Managing Partner, SEC Newgate Middle East, said: “The third annual ESG Monitor highlights a shifting corporate landscape in the UAE. Traditionally, businesses were mainly seen as contributors to the economy, but now, our community demands they balance financial success with ESG responsibilities. People expect action on ESG issues and a voice on matters vital to employees and customers. To respond to the community, companies must proactively address their environmental impact and support others throughout their operations, from customers and employees to supply chains.”
Last year’s survey identified a ‘Great Disconnect’ in ESG communications, and the 2023 survey shows that this disconnect still persists, particularly in the UAE. The community wants clearer communication of ESG efforts from companies, but trust in this messaging remains a challenge in the region.
Fiorenzo Tagliabue, Group CEO of SEC Newgate, commented: “Overall, it is clear from our research that consumer expectations have changed and the global community now expects organisations to think about their impacts on the planet and people from the outset.
“Employers will also have to respond to generational and national differences when communicating around the ESG issue. The good news is that community support for ESG agendas is continuing to grow, and there are now a multitude of organisations that companies can partner with to further their ESG credentials and communicate these initiatives in more impactful ways.”
Additional global ESG Monitor research findings:
- 67% rated their interest in ESG issues at 7 or more out of 10, up from 56% in 2022
- 77% agree it is important for companies to take action on ESG issues
- 71% agree that companies should speak out on issues that are important to their employees and customers
- Millennials are more optimistic for their country’s future than Baby Boomers
- The top three ‘most important’ issues across the globe, the research found that respondents were most concerned about:
- Addressing the rising cost of living (37% rated in top 3 issues)
- Ensuring quality, affordable healthcare for everyone (30%)
- Strengthening the economy (25%)
