A Financial Power house: How The UAE Is Emerging As A Sustainable Finance

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Now more than ever, sustainability is gaining utmost importance in all aspects of business operations. As the scientific community continues to issue warnings on  our planet and the need for businesses to act responsibly, governments around the world are taking continuous measures to prioritize sustainability.

This sustainable influence has also influenced the   in recent times. The concept of “Sustainable finance” has evolved past socially accountable investing to incorporate financial management and operations with environmental, social, and corporate governance standards. These changes are directly linked to the UN’s sustainable development goals, driving funding and disinvestments selections.

The Position Of UAE 

The UAE has been investing heavily in promoting sustainable finance across all sectors. This steady investment has now led the UAE  an emerging sustainable finance centre in the Middle East. UAE’s sustainability road map in the financial sector is clearly evident in its national and green development agendas, along with the Dubai Finance Declaration on Sustainable Finance, the National Climate Change plan 2017-50, the UAE Green Agenda 2015-30, and the recently announced Net Zero 2050 Strategic Initiatives.

Digital asset investors also  that UAE’S commitment to sustainability is also a theme at Expo 2020 Dubai. Besides this, even in the UAE’s contribution to the Ipscp World Investor Week, led by the Securities and Commodities Authority, sustainability features are prominent.

In January last year, the DFSA, along with other UAE financial regulators and exchanges, published the “Guiding Principles on Sustainable Finance”. The principles in the publications were comprehensively committed to encouraging and supporting financial services in the DIFC. Some of the published principles involve developing suitable strategies that will incorporate sustainable practices in their range of business activities, specifically within financial investment firms, their decision-making, risk management and other means of exploring new business opportunities.

Future Sustainable Initiatives

UAE’s soon-to-be-launched Sustainable Finance Road Map 2021-24 will also feature a range of new initiatives that are directed towards upholding sustainable finance practices and further fueling the growth of UAE as an emerging sustainable finance Centre.

The road map, according to a renowned investment group in Dubai, will include the adaptation of supervisory practices and proposals for regulatory policy changes. All these new initiatives will be taken while supporting and promoting sustainability reporting and other relevant disclosure frameworks.

The launch of the DFSA ESG hub is also shortly expected in the future of sustainable finance measures within the UAE. The hub will serve as a platform for multilateral engagement, education and dialogue on sustainable fiancé within the DIFC and will also extend partnership with parties like the DIFC Academy and the Toronto Centre.

When analyzing the above insights, it becomes apparent that the competency the UAE has in understanding and managing sustainability-related issues in the fast-paced finance industry, while maintaining an emerging position as a sustainable finance Centre heavily relies on three things: consistent standards, transparency and disclosure of sustainability issues.

If you need professional advice to begin your investment journey or need help to facilitate your growth in the investment market, reach out to us at the AIX Investment Group. We see all our investors as our partners in a better tomorrow and all our services are tailored to help them achieve their investment goals and enjoy a more prosperous future.

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