If the words “ESG development” make your stomach drop a little, you are in good company. Most sustainability managers, finance heads and founders we meet are not short on commitment. They are short on a clear starting point, and they are worried about getting it wrong in front of the board, the bank or the regulator.
So here is the short answer: no, ESG development is not as complicated as it sounds. It feels that way because the request usually arrives as a report to produce, with a deadline attached, before anyone has agreed what the business is trying to understand. Put the steps in the right order and the work becomes manageable, one decision at a time.
Picture the Monday morning email
An illustrative scenario, not a client story. A sustainability manager opens an email from the company’s bank asking for ESG data. Energy bills sit with facilities, headcount data sits with HR, supplier information sits with procurement. Nobody owns the whole picture, the CFO wants a number by Friday, and the manager suspects the numbers will not survive a second question.
That feeling is not a sign of failure. It is the normal starting point for ESG development in most companies. The way out is not a faster spreadsheet. It is a short list of decisions made in the right order.
What ESG development actually means
ESG stands for environmental, social and governance. Investors, lenders, regulators and large customers use these criteria to judge how a business manages risks that a standard balance sheet does not show: emissions, workforce practices, board oversight and supply chain exposure.
ESG development is the groundwork that lets you answer those questions with confidence. It is the policy, the materiality assessment, the data process, an owner for each metric and board oversight. ESG reporting is what you publish at the end. A report with nothing behind it is hard to defend when someone asks where a figure came from, and a company that cannot answer that question carries real reputational risk.
Why it feels heavy, and what helps
Five pressures cause most of the stress. None of them is unusual, and each has a practical answer.
| What you feel | What is really going on | What helps |
|---|---|---|
| “Our data is everywhere.” | Energy, HR and procurement data sit in separate files with different owners. | Name one owner per metric and agree a single data calendar. |
| “We cannot justify the cost.” | Budgets reward this quarter. ESG returns build over years. | Tie each initiative to a cost, risk or financing outcome the CFO already tracks. |
| “My team is already stretched.” | ESG tasks sit on top of day jobs with no incentive. | Add ESG metrics to role objectives and review them at board level. |
| “There are too many frameworks.” | GRI, SASB, ISSB (IFRS S1 and S2), TCFD and exchange guidance overlap. | Start with the framework your regulator or largest investor requires, then map the others to it. |
| “Customers keep asking us for data.” | Customers and lenders increasingly ask suppliers for ESG information, often at short notice. | List who will ask and prepare answers before they do. |
Data and spreadsheet problems get more room in our guide to common ESG reporting challenges.
Your ESG roadmap in five steps
- Find out what applies to you. Listing status, sector, licence and jurisdiction decide your obligations. This single step removes most of the anxiety, because it turns “everything” into “these specific things”.
- Run a materiality assessment. Ask which environmental, social and governance issues matter most to your business and your stakeholders. Everything you measure should trace back to that list, so you stop chasing metrics nobody needs.
- Set a baseline. Collect a full reporting year of data for the material metrics. Begin with energy use and Scope 1 and 2 emissions. When you are ready for Scope 3, our GHG reporting team can help.
- Approve a policy and give every metric an owner. Accountability is what turns good intent into an ESG strategy a board can stand behind. Here is what an ESG policy is and why it matters.
- Report, review, improve. Choose your sustainability reporting framework, publish, and review each year. Our ESG reporting services UAE team supports corporate ESG reporting from baseline to published report, and the case for doing it is set out in why businesses need ESG reporting.
What UAE and Qatar regulators expect
UAE listed companies. The Securities and Commodities Authority (SCA) requires public joint stock companies listed on ADX and DFM to publish an annual sustainability report under SCA Decision 3/RM/2020. ADX and DFM each publish their own ESG reporting guidelines, so a company listed on both should check both. This is the core of ESG reporting for listed companies in the UAE.
UAE emissions reporting. Federal Decree-Law No. 11 of 2024 on the Reduction of Climate Change Effects took effect on 30 May 2025. It requires in-scope entities to measure emissions, keep an inventory and report in line with standards set by the Ministry of Climate Change and Environment or the competent authority. Implementing rules determine who reports and when.
IFRS S1 and S2. The ISSB standards apply to annual periods beginning on or after 1 January 2024, but each jurisdiction decides whether and when its companies must apply them. For IFRS S1 S2 reporting in the UAE, confirm what your regulator and exchange currently require.
Qatar. The rule that applies depends on who you are. The Qatar Central Bank (QCB) sets ESG supervisory expectations for the banks and insurers it licenses. QFMA and QSE guidance applies to QSE-listed companies. A listed bank can fall under both.
Three mistakes that cost credibility
- Copying a competitor’s report. Their material issues are not yours, and reviewers can tell.
- Claiming more than you can measure. Every sustainability claim should be specific, measurable and backed by data you can trace. Vague claims invite greenwashing scrutiny.
- Waiting for a perfect dataset. A dated, honest baseline with stated gaps is more credible than a polished report built on estimates.
A calm next step
If you are not sure which obligations apply to you, you do not have to work it out alone. Book a free ESG compliance assessment with D1 Percent, an ESG advisory firm working with companies in the UAE, India and Qatar. We map your listing status, sector and regulator to the frameworks you need to follow, and tell you what to do first.
FAQ:
What is ESG development?
ESG development is the work of building the policies, data processes, governance and disclosures that show how a company manages environmental, social and governance risks. It is the groundwork behind an ESG report: a materiality assessment, a baseline of metrics, named owners and board oversight.
Is ESG development as complicated as it sounds?
No. It feels complicated when a company starts with the report instead of the business question. Taken in order (scope, materiality, baseline, policy, reporting), each step is a defined piece of work with an owner and an output.
What is the difference between ESG development and ESG reporting?
ESG reporting is the published output. ESG development is everything that makes that output defensible: the policy, the materiality assessment, the data process and the governance behind each number. A report without that groundwork is hard to defend when a lender, investor or auditor asks where a figure came from.
Where should a company start with ESG development?
Start by confirming which obligations apply to you. Listing status, sector, licence and jurisdiction determine what you must disclose. Then run a materiality assessment, set a baseline for the material metrics, approve an ESG policy and choose the framework you will report against.
We feel behind our peers. Is it too late to start?
No. A credible baseline started now is worth more than a polished report built on estimates. Lenders, investors and auditors look for traceable data and clear ownership, so begin with the metrics that matter most and build from there.
Is ESG reporting mandatory in the UAE?
It depends on who you are. The Securities and Commodities Authority requires public joint stock companies listed on ADX and DFM to publish an annual sustainability report. Federal Decree-Law No. 11 of 2024, in force since 30 May 2025, adds emissions measurement and reporting duties for in-scope entities. Other companies face investor, lender and customer requests rather than a direct mandate.
Which ESG framework should we use: GRI, ISSB (IFRS S1 and S2) or SASB?
Use the framework your regulator or largest capital provider requires first, then map the others to it. GRI covers a company’s impacts on the economy, environment and people. IFRS S1 and S2 focus on information investors need, with S2 covering climate and building on the TCFD recommendations. SASB offers industry-specific metrics.
Which ESG rules apply to companies in Qatar?
The regulator depends on your status. The Qatar Central Bank sets ESG supervisory expectations for the banks and insurers it licenses. QFMA and QSE guidance applies to QSE-listed companies, and a listed bank can fall under both. Check the current text of each rule before you plan, because requirements and dates have been changing.
Do we need ESG software, or can we report from spreadsheets?
Spreadsheets work for a first baseline. They become a risk when several people edit one file, when you need an audit trail, or when you report against more than one framework. At that point a dedicated platform reduces rework and gives reviewers a traceable source for each number. See our ESG software for how this works in practice.