Just 12% of Mena businesses have net zero target

Creative Commons/Peter Gronemann

• Survey of 200 companies, nine countries
• Only 6% of businesses have ‘roadmap’
• Government targets increase pressure

Businesses in the Middle East and North Africa (Mena) “lag behind” their global peers in terms of net zero targets, according to a report by the World Economic Forum and US consultancy Bain & Company.

WEF evaluated the disclosure and sustainability measures of around 200 publicly listed and private companies across Mena’s nine biggest economies. 

It found that just 12 percent of businesses have committed to setting net zero targets in line with national and global ambitions. 

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Even fewer – 6 percent – have laid out “clear roadmaps” for achieving such goals, according to the report.  

The companies studied constitute nearly 80 percent of the market cap of their countries’ combined stock exchanges. They include the largest privately owned companies from hard-to-abate (high-emitting) sectors such as energy, chemicals, steel, aluminium, aviation, cement and utilities, as well as financial services, consumer products and telecoms, WEF said. 

The report noted “encouraging signs of progress” in the actions of some of the largest companies in the region. It cited retailer Majid Al Futtaim, the UAE’s Adnoc and Etihad Airways, Kuwaiti logistics firm Agility, Saudi solar company Acwa Power and Saudi industrial and chemicals giant Sabic as examples.

Actions taken include rolling out measures to reduce greenhouse gas emissions, increasing use of renewable energy and scaling up nascent low-carbon technologies, such as green hydrogen and sustainable aviation fuel. 

However, the response from the Mena business community as a whole is “less than required and lags behind action in other comparable regions of the world”, the report warned. 

It said: “In the global drive towards sustainability, governments play a crucial role by creating policies, setting targets and facilitating discussions. However, the responsibility for delivering real change, the actionable transformation, often falls on the shoulders of the business community.”

The scrutiny Mena businesses face is likely to intensify as they come under increased pressure to align their practices with government net zero targets. 

Businesses are already being compelled to “make investments in sustainable technologies, cleaner production methods and stricter environmental standards, and to report this to maintain their market standing”.  

The report found that Mena countries’ – not businesses’ – net zero targets now cover an estimated 60 percent of the region’s emissions, but still fall short of tangible outcomes and the goals of the 2015 Paris Agreement. 

The study examined the nine biggest Mena economies: Saudi Arabia, the UAE, Egypt, Qatar, Kuwait, Morocco, Oman, Tunisia and Bahrain.

But a report covering the entire region by the International Energy Forum last month found that just six out of 17 Mena countries have set a target for reaching net zero carbon emissions.