Accounting for Tomorrow: Integrated Reporting by Gulf Developers
What has driven Gulf sustainability reporting?
There is no doubt that both the quantity and quality of Environmental, Social and Governance (ESG) reporting in the Gulf has risen dramatically over the past decade. What has driven this change?
The first and arguably the most important factor has been the explicit inclusion of ESG in national Government plans such as Saudi Arabia’s Vision 2030. Sustainability has been a pillar of how the Gulf envisages the future, but such emphasis is less common in national plans across most markets, where sustainability is often not explicitly prioritised. Vision 2030 describes ESG disclosure as ‘essential’ for corporate strategy and investor trust. It is explicit that, by 2030, Saudi Arabia expects ‘world-class’ ESG compliance across listed companies.
A second factor has been the emergence of green financing in the Gulf. Stakeholders, especially finance providers, now want to see ample and often very specific sustainability disclosures. In some cases, funding decisions are made on the basis of such disclosures.
A third driver has been initiatives by regional stock exchanges and central banks, aligned with the UN Sustainable Stock Exchanges Initiative. The Saudi Stock Exchange, for example, published ESG disclosure guidelines as early as 20181; the UAE Central Bank’s Principles for Sustainability-Related Disclosures currently date from 2024, although there were earlier guidelines.2 Such guidelines have encouraged companies to align with global standards.
Finally, the increased availability of competing standards played a role. These included the Sustainable Development Goals (SDGs), the Global Reporting Initiative (GRI), the Sustainable Accounting Standards Board (SASB), the Task Force on Climate-Related Financial Disclosures (TCFD) as well as benchmarks provided by international real estate investment organisations such as the Global Real Estate Sustainability Benchmark (GRESB).3
What has been the response from Gulf developers?
Back in 2010, there were few formal ESG reports and only ad hoc Corporate Social Responsibility (CSR) web pages. Early adoption began around 2015 with sporadic sustainability reports and announcements, and initial references to the SDGs and GRI. The pace picked up just before the pandemic, with more companies adopting TCFD standards and including increased board oversight. External assurance began to be a key demand of experienced investors. But it has been since the end of the pandemic that the process has really gathered steam with the publication of internal policies, the adoption of standards, and the publication of standalone ESG reports. This has paralleled a progressive increase in the number of signatories of the GRI, of the SDGs and of GRESB.
In the UAE, the biggest developers have largely led the way – as has been the case in jurisdictions such as the UK and Australia. Emaar’s and Aldar’s integrated reports have been among the most comprehensive. Emaar, for example, now reports according to the GRI and the SDGs, as well as to the Dubai Financial Market’s Guide to ESG Reporting. Especially noteworthy has been the focus on Morgan Stanley Capital International (MSCI) rating performance, which reflects exposure to industry-specific ESG risks and the
ability to manage those risks relative to peers. Emaar was upgraded from BB to BBB in February 2025, its third upgrade in four years4, while Aldar has gone one step better in its MSCI journey, upgraded to A in June 2025.5
There continue to be challenges. For example, ESG reporting for existing assets is easier than for development. This explains why many of the achievements and certifications cited in developer integrated reports relate to existing assets, such as the Platinum Leadership in Energy and Environmental Design (LEED) status for the Burj Khalifa, WELL Building Standard (WELL) certification, energy management programmes through district cooling or other means, water and waste recycling initiatives, or Green Key-certification for hospitality assets. The same logic applies implicitly to materiality assessments.
UAE developers are now turning their attention to reporting on adherence to green building standards and Clean Energy Council requirements worldwide. In some cases, such as Emaar, developers have their own building design standards and guidelines that align with international green building requirements. However, there is still an ESG ‘data gap’ between developers and operators worldwide. In particular, MSCI and other ESG rating agencies are seeking evidence from developers of year-on-year carbon reduction and credible Scope 3 (value chain) emissions accounting, which is always difficult for developers. This includes embodied carbon strategies in materials and verified energy efficiency outcomes in delivered assets.
Developers will now receive a further impulse to improve their performance in this regard, as the UAE has issued a federal law on climate change, effective from May 2025, requiring public and private sector organisations to measure and report their greenhouse gas emissions and publish time-bound plans to achieve reductions. In this respect, Emaar’s decision to establish an emissions inventory baseline that includes Scope 1, 2 and 3 emissions for key markets is both highly welcome and market leading.
In Saudi Arabia, Red Sea Global has been a standout performer in ESG reporting. Its 2024 report, its fourth, details how the group is monitoring and reporting against targets across environmental sustainability, social empowerment and governance.6 Red Sea’s ESG reports have demonstrated a clear sustainability strategy, evidenced measurable environmental baselines, and provided biodiversity and conservation data. Each report was developed in accordance with GRI standards and has been aligned with the UN SDGs, as well as with the Saudi Vision 2030. Red Sea may have been a pioneer, but it is not alone among companies owned by Public Investment Funds (PIFs). Others, such as ROSHN, which took on the role of ‘Sustainability Champion’ in 2024,7 are evolving their whole reporting practice, and currently issue corporate updates, press releases, and CSR/ESG disclosures through its website and Vision 2030 channels.8
How do Saudi listed companies compare to their PIF-owned counterparts? Jabal Omar, for example, has focused on explaining its ESG journey, and reports ESG independently, which explains its SDG transparency rating.9 Other important Saudi developers, such as Al Akaria and Retal, still take a much more restrained approach to ESG reporting. There is no doubt about their commitment, reflected by the awards they have both received, but they have not issued separate ESG reports to date. Their ESG reporting is included in their annual reports, but there is no MSCI ESG rating yet for Saudi developers. The closest parallel is the CSR Hub reporting for the Saudi Real Estate company.10
Evidence suggests that the ESG reporting landscape in the Gulf is still emerging. Australian listed developers such as Mirvac, Stockland and Goodman, for example, typically achieve higher MSCI ESG ratings than UAE developers. This is because they
operate in a regulatory environment with mandatory carbon reporting, audited sustainability disclosures, high conformity with the much-debated system of international controversy scoring,11 and mature governance frameworks, all of which align closely with MSCI’s risk based methodology. By contrast, UAE developers like Emaar and Aldar with larger development portfolios face
For example, all developers can improve by publishing LTIFR (Lost Time Injury Frequency Rate) and TRIFR (Total Recordable Injury Frequency Rate) statistics from their contractors,17 along with incident responses evidencing remediation, which Emaar already does.
From reporting maturity, the next step is to rating maturity. The stakes remain high, as the rewards to the leaders will be access to cheaper capital, higher quality human capital, and control over the future of the global real estate sustainability narrative.
Siraj Ahmed Director, Head of Strategy and Consulting
Conclusions: Leadership within grasp
Until now, Gulf ESG reporting beyond the listed sector has been largely voluntary but strongly encouraged. In this phase, huge strides have been made in the quantity and, above all, the quality of reporting over the past decade both in Saudi Arabia and the UAE. With the introduction of mandatory reporting, the future is even brighter: while the creation of the ISSB and the harmonisation of global standards might at first seem to rule out the possibility of leadership in this area, backsliding in important jurisdictions shows that the reverse is actually true. From reporting maturity, the next step is to rating maturity. The stakes remain high, as the rewards to the leaders will be access to cheaper capital, higher quality human capital, and control over the future of the global real estate sustainability narrative.
Authors
Siraj Ahmed Director, Head of Strategy and Consulting siraj.ahmed@cavendishmaxwell.com
+971 50 382 4409
ksa@cavendishmaxwell.com
Zacky Sajjad Director, Business Development and Client Relations zacky.sajjad@cavendishmaxwell.com
+971 50 644 5089
