COP28 will boost Dubai's and DIFC's green drive

His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai has said that COP28 will be the most important event hosted by the nation in 2023. DIFC agrees.

DIFC’s commitment to sustainability began long before the UAE was announced as the host of COP28. As early as 2019, DIFC, along with other partners such as DFM, spearheaded the establishment of the Dubai Sustainable Finance Working Group (DSFWG) – the first group of its kind that has set out a roadmap to achieve the sustainability objectives of the UAE and develop sustainable finance policies for the emirate. Through the DSFWG, we have been integrating Environmental, Social and Governance (ESG) best practice across Dubai’s finance sector with the goal of creating the most sustainable financial hub in the region.

In the pursuit of net zero goals and the transition to a clean energy future, new forms of capital and exchange are emerging to fund climate action, reinforcing the pivotal role of the finance industry in influencing sustainable outcomes.

Purpose-driven investments that integrate sustainability considerations and deliver positive environmental and social impact are shaping the future of finance today and driving the industry forward. We are increasingly seeing how finance sector participants are actively taking the shared responsibility in building a sustainable, inclusive, and resilient global economy to support full-scale transformations of communities and nations.

If the 26th edition of the UN Climate Change Conference (COP26) in Glasgow, Scotland, marked the onset of the finance industry’s plunge in spearheading efforts in the fight against climate change, COP27 in Sharm El Sheikh, Egypt, witnessed a major leap forward as nations agreed to create a breakthrough Loss and Damage Fund to deliver much-needed resources to support vulnerable countries hit hard by climate disasters.

Against this backdrop, climate finance will once again take centre stage at the upcoming COP28 hosted by the United Arab Emirates in November 2023. The economic case for inclusive climate action will take centrestage as financial institutions and their stakeholders share the determined, impactful actions taken to bridge emissions and adaptation gaps.

All eyes will be on the innovative strategies of the UAE and how it will lead the energy transition. The UAE’s push for bold climate action led to it becoming the first in the region¹ to announce a Net Zero by 2050 target and at COP27, it also announced how to achieve the goal, through the National Net Zero by 2050 Pathway².

As a growing hub for energy transition companies, the UAE is attracting increased inward investment to scale up its competitiveness through innovations and technologies of the Fourth Industrial Revolution (4IR) and artificial intelligence (AI) as it enters a new era of sustainable development and economic diversification. The adoption of 4IR strategies have led to the emergence of climate-controlled greenhouses, aquaculture facilities and vertical farms in the UAE, and technology will continue to pave the way for more food security initiatives, innovative agriculture, and smart farming.

The role of financing becomes increasingly critical in the transition to a climate-neutral, resource-efficient and resilient economy. For DIFC, a financial hub driving the future of finance in the UAE and the wider Middle East, Africa and South region, this path to net zero represents both a challenge and opens a world of new opportunities.

Our Path to COP28 has commenced and includes a year-long partnership with the Global Ethical Finance Initiative (GEFI) that aims to drive change across the world’s financial industry. Together, we are bringing the global finance community together to advance thinking and action relating to climate and ESG principles through four core workstreams which are: delivering Net Zero, unlocking Islamic finance, financing nature and biodiversity, and financing sustainable development goals.

It is noteworthy that through DIFC, the financial services sector emerged as the first industry to launch a programme that aligns with the UAE government’s COP28 agenda. DIFC is building momentum and enhancing knowledge and awareness of COP28 and climate finance with a 12-month training programme – the Climate Finance Training Series, offered jointly by DIFC Academy and GEFI. Our goal is to help finance practitioners understand the COP process, global trends in climate finance, and best practice approaches to developing and implementing net-zero strategies.

By raising awareness of the impact of investment decisions on people and planet, we are encouraging our 30,000+ strong community to shift their attention to sustainability impacts and make ESG related decisions when assessing business transactions. Today, sustainability is embedded in the heart of all initiatives we undertake. For several years, DIFC has been awarded LEED certification when developing new buildings. We will continue to achieve LEED accreditation for upcoming projects such as DIFC Living and Innovation Two. DIFC will continue to promote the benefits of a diverse workforce and initiatives that reduce energy and conserve resources.

As we look to usher in the next wave of innovation and drive value creation in the UAE economy, we remain committed to fulfilling sustainability objectives to steer growth, resiliency and generate better outcomes for our people and the planet.

Arif Amiri is CEO of DIFC Authority. Views expressed are his own and do not reflect the newspaper's policy.

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