Qatar is stepping up its focus on sustainability, and Qatari companies are helping drive the momentum. The country’s National Vision 2030, published in 2008, already put an emphasis on environmental sustainability long before the term ESG became part of the global conversation. More recently, the establishment of the Ministry of Environment and Climate Change and the launch of the National Climate Change Action Plan, both in 2021, accelerated the drive to meet targets, including a 25% reduction in greenhouse-gas emissions by 2030.

These initiatives and achievements are bearing fruit at a time when companies in Qatar and across the Middle East are addressing growing demands for action on climate issues, ahead of the upcoming COP28 in November 2023 in Dubai. Our recently published 2023 PwC survey on environmental, social, and governance (ESG) issues in the Middle East, our second year of conducting this research in the region, highlights how companies in Qatar and other countries are addressing the increased demands for sustainability. Two new approaches stand out.

First,  companies are reporting more consistently on their environmental footprint, as part of an intensifying regulatory push for transparency. Some are also going beyond compliance to provide a new and deeper transparency.

Second, companies are adopting a more systematic approach to sustainability, including making organisational changes. This notably takes the form of adding high-level positions with specific responsibility for climate-related issues: more than one in four companies in the region now has a Chief Sustainability Officer.

The key trend emerging from the survey is the way that Middle East companies of all sizes are taking concrete steps to move from “start-up” mode to a new, richer and deeper “scale-up” mode when it comes to sustainability. More than 60% of all the respondents in the region told us that their companies now have embedded ESG issues in company strategy, for example. Qatari companies were the third largest group of respondents.

There are still some important gaps that need to be filled, including equipping workers with new skills and leveraging the growth of “sustainable finance” including green bonds – debt instruments that raise money for specific environmental projects.  The survey also highlighted demands on both business and government leaders: respondents want boards to spend more time on sustainability issues and, ahead of COP28, they are looking to policy makers in the region to step up and create the sort of policy frameworks that have been introduced in both the United States, with the Inflation Reduction Act, and in Europe, with plans including the Green New Deal.

The overall momentum towards greater sustainability is a welcome trend. Qatar-based companies have long been encouraged to incorporate ESG reporting in their public disclosures; the Qatar Stock Exchange published ESG guidelines already in 2015 and has indicated that a transition to mandatory reporting is likely. Qatar National Bank is one of the leading Qatari companies that publishes detailed ESG reports; it says it aspires to be a sustainability leader among its peers. Overall in the region, our survey found that about 70% of companies report on ESG and one-quarter of those produce a stand-alone ESG report. Moreover, six in ten of those that do report say their reporting is formally audited or assured.

Like other territories in the region, as Qatari companies push ahead to become more sustainable, they will need to focus on several areas. One will be to address the lack of skills: two in five respondents in our survey said the lack of internal skills and expertise to implement ESG initiatives in their companies was a key obstacle. While companies can do more to strengthen training programmes, other stakeholders also have important roles, including educational and vocational institutions.

A second important path forward is to make greater use of the growing possibilities to tap into sustainable finance. One third of the respondents in our survey identified ESG funding constraints as an important barrier. Green bonds and other debt instruments linked to sustainability goals are nonetheless on the horizon in Qatar. And the Qatar Development Bank has launched a “green financing” programme that in particular targets small and medium-sized enterprises looking to introduce or use clean and sustainable projects to support their business operations by reducing their energy costs and carbon footprint. It also supports firms that produce or manufacture green products.

In short, Qatar and its economy is moving ahead rapidly to set and meet sustainability goals. The journey still has a long way to run and some important hurdles will need to be cleared, but momentum is picking up. It’s fitting that the International Horticultural Expo will be taking place in Doha starting in October, under the theme “Green Desert, Better Environment.” That’s a motto Qatari companies are taking to heart as they look to a more sustainable future.

 “Sustainable Finance and Product Framework 2023,” QNB. www.qnb.com/sites/qnb/qnbqatar/document/en/SustainableFinanceandProductFramework2022

“Clean energy and eco-friendly projects financing,” Qatar Development Bank. https:”//www.qdb.qa/en/green-financing

 Expo 2023: Green Desert, Better Environment,” https://www.dohaexpo2023.gov.qa/en/