The UAE’s sustainability journey has reached a decisive inflection point. What began as vision and commitment has now matured into execution, systems, regulation and accountability. By 2026, ESG in the UAE is no longer peripheral. It is becoming embedded within the country’s economic and institutional infrastructure.

Five clear ESG trends stand out. Together, they illustrate how sustainability in the UAE is shifting from intent to impact.

1. Mandatory climate reporting and the emergence of a carbon market

The most transformative shift is regulatory. The UAE’s Federal Decree Law No. 11 has fundamentally altered the ESG landscape by introducing mandatory climate action frameworks, including structured emissions measurement, reporting and oversight.

Crucially, the law also lays the groundwork for a national carbon ecosystem through formal carbon credit registries and market mechanisms. This signals a clear direction of travel, from voluntary disclosure to verifiable data, and from data to market-based instruments.

By 2026, emissions reporting will form the foundation for carbon pricing, trading and accountability. ESG credibility will increasingly be defined by the quality of emissions data and the strength of governance structures.

2. Sustainable finance moves into the mainstream

Sustainable finance is rapidly becoming central to capital strategy in the UAE. Green bonds and sustainability-linked loans are now mainstream tools for capital allocation.

Banks and investors are embedding ESG performance into credit assessment, pricing and long-term risk evaluation. For corporates, this means sustainability metrics increasingly influence access to capital and the cost of funding.

The scale of this shift was reinforced at Abu Dhabi Finance Week 2025, the region’s largest financial gathering, where the UAE Sustainable Finance Working Group announced its latest framework to advance climate transition planning. This marked a decisive move from ambition to capital market execution. Driven by the national pledge made at COP28, the UAE financial sector is targeting the mobilisation of Dh1 trillion ($272 billion) in sustainable finance by 2030, supported by coordinated efforts across banks, regulators and capital markets.

3. Energy transition accelerates through renewables

In 2026, the UAE is accelerating its transition to a clean energy future, driven by large-scale capital investment and the integration of advanced technologies such as artificial intelligence and green hydrogen.

According to industry forecasts and market analysis, renewable energy generation is forecast to grow at an average rate of around 14 per cent annually between 2025 and 2027, reflecting a clear step change in deployment rather than incremental progress.

Solar photovoltaic power remains the dominant growth driver. Industry estimates indicate that by 2027, solar will account for nearly 70 per cent of total renewable electricity generation in the country, supported by continued expansion of large-scale projects. National installed renewable capacity reached approximately 7.29 GW in 2025 and is projected to rise to around 12.42 GW by 2030, according to energy market assessments. Flagship developments such as the Mohammed bin Rashid Al Maktoum Solar Park continue to anchor this trajectory, reinforcing renewables as core economic and energy infrastructure rather than niche climate solutions.

4. Green urban development becomes the ESG frontline

Urban development has emerged as one of the UAE’s most advanced sustainability frontlines. By mid-2023, nearly six in ten buildings in Dubai were already compliant with green building standards, reflecting how sustainability has moved from niche to mainstream across the built environment. Nationally, the UAE has more than 1,500 LEED-registered and certified projects, the highest concentration in the Middle East.

What is more telling than growth rates is market behaviour. Green-certified buildings are rapidly becoming the default, driven by regulation and tenant demand. By 2026, green compliance will be a must-have strategy for assets to remain competitive within the UAE’s urban economy.

5. The plastic ban reaches its most comprehensive phase

Perhaps the most visible sustainability shift for businesses and consumers alike is the expansion of the UAE’s single-use plastic restrictions. The year 2026 marks the most comprehensive phase of nationwide implementation, extending bans across a wider range of consumables.

This policy shift is forcing businesses to rethink packaging, procurement, and customer engagement. It also reflects a broader behavioural transition, as consumers increasingly favour sustainable alternatives.

How Galadari Brothers is positioned for the 2026 ESG landscape

These trends are not theoretical. At Galadari Brothers, we have been proactively aligning our strategy, investments, and operations with the direction of travel.

We have been publishing our comprehensive annual Sustainability Reports including detailed greenhouse gas monitoring across our operations, strengthening transparency and readiness for mandatory reporting. On the financing side, we have accessed sustainability-linked loans and green financing, embedding ESG performance into our capital structure.

Operationally, we are investing in solar energy panels across our facilities to support the renewable energy transition. In urban development, our upcoming sports arena complex is being developed to achieve Al Sa’fat Gold certification, integrating energy efficiency, water stewardship, and community wellbeing by design.

Equally important, our food and beverage restaurants and cafes have phased out single-use plastics from product consumables, aligning early with the most stringent phase of the national plastic ban.

As we step into 2026, ESG in the UAE will be increasingly defined by execution. Regulation, finance, infrastructure, and consumer policy are converging to embed sustainability into how businesses operate.

The organisations that succeed will be those that treat ESG as a strategic operating system, built on data and long-term investment. In the UAE’s next phase of growth, sustainability will emerge as a core driver of ambition and competitiveness.

• Engineering

Written by

Sayali Singhi Contributor

Sayali Singhi is the Group Head of Project Planning at Galadari Brothers, where she helps shape group-wide ESG and CSR initiatives. She is a CFA charter holder and a certified sustainability professional.