In The Headlines - March, 2024

1.

Saudi Arabia releases its green finance framework?

The Saudi Ministry of Finance has introduced the Green Financing Framework outlining eight types of projects eligible for funding through green bonds.?

These projects include support for clean transportation, renewable energy, and initiatives to help the kingdom adapt to climate change. Under the framework, the Ministry of Finance?can sell green bonds – sukuk – for projects that meet set standards. ?

This initiative supports KSA’s ambition of achieving net-zero emissions by 2060.?

2.

The US Securities and Exchange Commission mandates climate disclosures

The US Securities and Exchange Commission (SEC) has adopted The Final Rules to enhance and standardise climate-related disclosures and their impact. The Final Rules were scaled back after years of feedback from stakeholders in response to the initial Proposed Rules released in March 2022.?

The climate disclosure rules require public companies to disclose a host of climate-related information in their periodic reports and registration statements. That information includes material climate-related risks; activities to address or adapt to such risks; information on the company's board of directors' oversight of climate-related risks; and information about any climate-related targets or goals material to the company's business, results of operations or financial condition.?

However, the Rules have faced hurdles in court, with some challengers claiming?that?such broad climate-related disclosures will subject companies to?increased enforcement and litigation.?

3.

UAE plants 10 mangrove trees for each COP28 visitor?

Environment Agency, Abu Dhabi has planted 850,000 mangrove trees along Abu Dhabi emirate’s coastal areas as part of the Ghars Al Emarat (UAE Planting) initiative to plant 10 mangroves for each visitor to COP28 at Expo City Dubai.?

The UN Climate Change Conference in Dubai hosted about 85,000 participants last year. Using innovative methods like drone seeding, the mangrove trees were planted in locations that offered the most suitable environments for growth, like Marawah Marine Biosphere Reserve, Al Mirfa City, and Jubail Island. The initiative will help absorb 170 tonnes of carbon from the atmosphere annually.?

4.

Energy executives expect world to reach net zero by 2060 or later ?

Despite energy and natural resource companies’ continued investments in decarbonisation, about 62% of executives now anticipate the world will reach net zero by 2060 or later, up from 54%?last year. This view is consistent across most regions and is most strongly held among oil and gas executives, according to the results of?Bain & Company’s fourth annual?Energy & Natural Resource Executive Survey.?

The survey sought to get 600 industry executives’?views on the energy transition, new technologies, and investment opportunities, and where they see the greatest challenges for decarbonisation. ?

70% of the executives say the greatest obstacle to scaling up their transition-oriented businesses is finding enough customers willing to pay higher for low-carbon alternatives. They noted that the rising interest rates and cost of capital in 2023 and is likely to shape customer willingness to pay. They also cited the struggle to create sufficient return on investment.

Executives in the Middle East (61%), Asia-Pacific (55%), and Latin America (51%) are most optimistic about the financial prospects of their transition-oriented?initiatives?such as renewables, hydrogen, bio-based products, and lithium,?and therefore?are maintaining or increasing green investments. ?

In Europe and America, only 30% and 29% respectively revealed optimism that?low carbon?energy alternatives would grow the bottom-line.

5.

Why the world’s biggest banks continue to fund fossil fuel?

The world’s biggest banks are quietly hanging on to carbon-intensive clients because of what they see as unrealistic demands from regulators and civil society, and the threat to their fees.?

According to Bloomberg, 20 of the world’s biggest banks have allocated a total of $2 trillion in loans to fossil fuels in loans since the signing of the Paris Agreement in 2015. ?

This reflects what BlackRock CEO Larry Fink termed in his 2024 annual chairman’s letter to investors as 'energy pragmatism', where energy transition and energy security are now considered equally important.??

Despite setting lofty decarbonisation goals for the last four years, investment banks and asset managers are finding it hard to lose major lines of huge fossil fuel revenues. Regulation can also be confusing and even?contradicting, especially in the US where anti-ESG legislation is rife. ?

In addition, winding down a carbon intensive portfolio means getting out of ongoing projects and getting rid of existing clients, some in geographies that still rely on fossil fuels. These banks are unwilling to break these long-serving ties.?

As a result, financial players have been backtracking on their commitments. In February, JPMorgan Asset Management, PIMCO, Invesco, among others?left Climate Action 100+, the biggest climate-focused investor network focused on reducing emissions. Launched in 2017, Climate Action 100+ has targeted the world’s largest corporate greenhouse gas (GHG) emitters to promote taking necessary action on climate change, and align their business strategies with net zero in order to help limit average global temperature rise to 1.5 degrees Celsius. The network has grown to include more than 700 investors representing more than $68 trillion in assets.?

6.

Oil & gas producers score poorly in decarbonisation ratings?

While global oil and gas producers are under increasing international pressure to decarbonise and phase out fossil fuels after COP28, Morningstar Sustainalytics indicates that 60% of?oil and gas producers are currently categorised as Severely Misaligned or Highly Misaligned to meet future net zero targets in the company’s Low Carbon Transition Ratings (LCTR).?

Growing geopolitical uncertainty in 2023 forced companies to focus more on energy security and less on climate targets, resulting in very little progress toward decarbonisation objectives. Morningstar Sustainalytics analysed 143 of the largest oil and gas companies globally in three subindustries – Exploration and Production, Coal and Integrated Oil and Gas.?

The trendsetters are in Europe, with its mix of favourable climate-related policies and regulations. Oil and gas companies that have invested in renewable energy production and away from fossil fuel achieve better relative LCTR management scores.

7.

UN Global Compact launches 2024 campaign to recognise business leaders driving sustainable development?

The United Nations Global Compact has announced the launch of the 2024 SDG Pioneers campaign,?designed to honor exceptional individuals within the business community who are leading the way in advancing the Sustainable Development Goals (SDGs).?

The SDG Pioneers aims to recognise business leaders who are demonstrating innovation, impact, and commitment towards achieving the SDGs, thereby inspiring others to follow suit. Nominations for the SDG Pioneers are open to all individuals working within companies participating in the UN Global Compact. Nominees will be assessed based on their contributions to advancing one or more of the SDGs through innovative solutions, partnerships, advocacy efforts, or other impactful initiatives.?

FROM SS DESK

SS NEWS

1.

Sustainable Square & IFRS Foundation to host virtual seminar on IFRS S1 and S2

Unlock the power of reporting with IFRS Foundation 's global reporting standards in our upcoming webinar! Gain insights into IFRS S1 and S2, prepare for seamless reporting in 2025, and engage directly with the expert IFRS team.

The webinar will be conducted by our Senior ESG & Sustainability Analyst Rach ElGolli and IFRS Foundation's Corey Walrod.

Date : Thursday, 18th April, 2024

Time: 11.00 AM- 1.00 PM GST

Confirm your spot by registering here: https://lnkd.in/gYFQnHMA

2.

Sustainable Square & Capital Club to host webinar on Navigating ESG Data & Reporting Challenges Using AI-driven Tech.

Sustainable Square and Capital Club Dubai cordially invite you to our joint webinar on Navigating ESG Data & Reporting Challenges Using AI-driven Tech. The speakers will be?Monaem Ben Lellahom and Fatima Al Attar.

?? Mon, Apr 22

? 10:00 AM - 11:00 AM GST

?? Location: Online event

You will learn to:

?? Elevate your ESG reporting process using AI, saving time and costs, and improving quality

?? Consolidate data collection and management in one user-friendly platform

?? Align your report with global and regional frameworks or standards

Looking forward to seeing you there!

Book your slot by registering here: https://lnkd.in/gw34KNUu

3.

Sustainable Square CEO to speak at AFCM annual conference

?? We are happy to announce that our CEO Monaem Ben Lellahom will be speaking at the Arab Federation of Capital Markets (AFCM) Annual Conference | Qatar 2024, on 30th April.

Monaem will be part of a panel discussing " The New ISSB Standards at a Glance: Is the Region Still Lagging Behind?" 2024 Arab Federation of Capital Markets (AFCM)

4.

Our team conducts sustainability workshop at Daleel Petroleum LLC

Sustainable Square , represented by Dinah Gengmei and Monaem Ben Lellahom hosted a four-day ESG and Sustainability workshop for Daleel Petroleum LLC. Team leaders, senior managers, engineers, and directors from various departments were introduced to Daleel's ESG journey, which aligns with the efforts of their shareholder, Petrogas E&P.

The participation of the Ministry of Energy and Minerals provided valuable insights from an external stakeholder perspective, while the workshop reinforced Daleel's dedication to employee learning and development in ESG.

5.

Our team recycling drive

?The February #employeeengagement activity was a #decluttering drive initiated in line with our #netzerostrategy . At Sustainable Square we believe in creating a positive environmental impact as individuals and as a team.

Regards to Kiswa who supported our recycling initiative!???

SS INSIGHTS

1.

Celebrating International Women's Day

On the occasion of #InternationalWomensDay , our Senior Social Impact Advisor Jalila Hedhli enumerated the ways in which we can all invest in women and embed equality and inclusion in our cultures and education system. She talked about the roles of governments, corporations and communities in ensuring the inclusion and prosperity of women.

2.

Strategies for achieving circularity in oil & gas

The oil & gas industry across GCC nations has started embracing #circularity but these companies need to integrate it extensively in order to attain #emissionsreduction or net zero goals.??

As our Climate Change & Sustainability Advisor Poonam Nagarkoti writes, the oil and gas sector produces a lot of waste, some of which is hazardous enough to cause chemical and heavy metal contamination of surface water, groundwater, and seawater. She highlights best practice in circular approaches within this industry.

3.

Net-zero is the key to sustainable development in GCC countries

Why #NetZero ?

Why should companies in the GCC region align to national net-zero pledges and plans? In this write-up, our Climate Change & Sustainability Analyst Lekshmi Karthikeyan looks at the unique #climatechange factors playing out in the GCC and advises on how to go about creating a net-zero roadmap.

4.

Investing with impact: Navigating the ESG landscape in private equity

Companies with strong #ESG ratings outperform their counterparts in the long run. In this article Monaem Ben Lellahom looks at ESG-centred investing. He guides on how to create a framework that helps monitor the ESG-related risks and opportunities in your #portfolio to ensure resilience and unlock long-term #value .

Thank you for reading The ESG Bulletin. See you soon, with the next edition of our monthly newsletter tackling the latest in global sustainability. If you would like to get in touch with our expert consultants to find out what Sustainable Square can do for your organisation's sustainability goals, reporting and disclosure please write to?us at [email protected] .