Achieving climate resilience for businesses in the Middle East
In September 2023, we released the findings from our Middle East sustainability survey, Building a sustainable future in the Middle East. In this report, we identified four recommendations, centred around regulation, project lifecycles, sustainable procurement, and net zero, that aim to guide the construction industry towards a sustainable future.
In this article, the fourth in the series, we explore how businesses can develop an effective pathway to set out and achieve net-zero goals.
The net-zero challenge
Almost 80 percent of our survey respondents stated their business had not yet set a net-zero goal. Forty-four percent noted their business planned to do so within the next two years. This indicates a slow trajectory of climate uptake.
Roughly 40 percent of the world's cumulative annual carbon emissions are caused by the built environment. With the world’s growing population, we need to increase housing and infrastructure to accommodate this. The expansion of the construction sector is therefore inevitable.
Achieving net zero is a challenging goal that requires significant change in the way buildings are designed and operated. There’s a critical need to focus on the development of an integrated roadmap that accounts for different businesses – and their interdependencies across the construction industry supply chain.
The Middle East’s current position on the path to net zero
Several countries within the Middle East have acknowledged the importance of addressing climate change. Their governments are setting ambitious net-zero targets across various guidance documents.
The UAE and KSA have announced plans to achieve net zero by 2050 and 2060, respectively. This includes focusing on adopting more sustainable strategies, targeting green building certifications, developing emissions reduction strategies and investing in renewable energy.
However, challenges remain in the form of data monitoring and emissions accountability across the industry.
The role of businesses in the net-zero transition
Every industry player has a crucial role in driving the transition to net zero. They can influence and implement strategies, policies and initiatives to reduce carbon emissions across supply chains.
Governments have an influence on regulations and financial institutions disclose climate risks. On the other hand, businesses can proactively drive change in the industry’s transition to net zero through four key stages:
- Develop a business case for change and plan of action.
- Integrate net-zero targets into existing business strategies.
- Define, communicate and update net-zero strategies in line with financial and regulatory change.
- Upskill employees to support the net-zero targets.
Driving a net-zero journey
There are several key drivers that are influencing businesses to implement long-term net-zero strategies:
Cost savings
As the cost of energy continues to rise across the Middle East, buildings with efficient performance will help stabilise this impact. The capital cost of introducing efficient systems may be higher. However, the long-term savings from less system use and lower maintenance offset the upfront costs.
Competitive advantage
Businesses across the region are realising the value of capitalising on innovation to maintain their position as market leaders. They do so by measuring and reporting on the impact of their operations.
Through assessing their impact, they can identify areas of improvement and mitigate the risks associated with climate change.
Continuous improvement
By consistently evaluating processes, businesses can identify inefficiencies and implement sustainable practices, ultimately resulting in reduced emissions.
It also enables companies to stay ahead of regulatory changes and evolving market demands. This ensures that their net-zero initiatives remain effective and relevant over time.
Creating a net-zero roadmap
It is essential to set out a clear and practical plan that can be put into action across a business. A roadmap provides a clear direction for a business’ targets. It identifies performance metrics and establishes timelines for implementation.
A clear roadmap will guide decision-making processes and align priorities across different functions. This will support consistent progress towards net zero.
The most effective net-zero roadmap will incorporate the following:
Carbon accounting
To understand the baseline across all scopes and activities, it’s vital to first establish the organisational and operational boundary of a business. To ensure a robust reporting mechanism, carbon measurement and monitoring functions should be embedded into business processes.
Net-zero accounting
Overarching business goals need to be set up in line with the Science Based Targets initiative (SBTi). Companies should establish measurable, science-based targets for reducing emissions across their value chains and regularly monitor progress.
Carbon reduction opportunities
Identify ownership and factors that are driving emissions generation. This will form the base of establishing a stakeholder engagement framework outlining roles and responsibilities.
To help decision-making and long-term planning within the business, it is crucial to develop a materials reduction solutions strategy. It is essential that suppliers are analysed and aligned with the results of the baseline study.
A sustainable future
By integrating the impact of carbon emissions into decision-making processes and supply chains, businesses can go beyond stand-alone commitments. They will make informed choices that minimise environmental impact, reduce greenhouse gas emissions and promote sustainable practices.
It’s essential that businesses regularly review internal strategies. This ensures they remain effective and aligned with global and local guidelines.
Business leaders need to consciously make net-zero practices part of their day-to-day operations. Embedding net-zero considerations into a business's core values can create a more resilient business model. This also supports the acceleration of adoption by others in the industry.
If developed and implemented correctly, a robust net-zero pathway has the potential to drive change and create a more sustainable future in the Middle East.