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ALERT MEMORANDUM  
Gulf Exchanges Announce Unified  
ESG Disclosure Guidance for  
GCC-Listed Entities 
 
February 24, 2023 
On January 9, 2023, the Exchanges Committee of the 
Gulf Cooperation Council (“GCC”) published a set of 
unified indicators for voluntary ESG disclosures by local 
listed entities. 
The Committee is chaired by the Saudi Exchange, and includes also 
the Abu Dhabi Securities Exchange, Bahrain Bourse, Boursa 
Kuwait, Qatar Stock Exchange, Muscat Stock Exchange, and the 
Dubai Financial Market. 
Although the indicators are for the time being voluntary and do not 
replace existing ESG disclosure guidelines issued by the GCC’s 
individual stock exchanges, they represent a significant 
development for entities and investors in the region. The ESG 
indicators also show that the six GCC countries, all of which are 
oil-producing nations, are serious and committed in their efforts 
towards fostering and integrating green and sustainable economy, 
and suggest that the direction of travel in the region may be towards 
further harmonization of sustainability-related regulations. 
This alert memorandum briefly summarises the structure and 
purpose of the GCC’s new ESG disclosure guidance, and places 
them in the wider context of global emerging regulations on ESG 
disclosures for listed companies.  
If you have any questions concerning 
this memorandum, please reach out to 
your regular firm contact or the 
following authors 
 
ABU DH ABI  
Chris Macbeth 
+971 2 412 1730 
cmacbeth@cgsh.com 
Lynn Ammar 
+971 2 412 1714 
lammar@cgsh.com  
Misthura Otubu 
+971 2 412 1813 
motubu@cgsh.com 
Hiba Younes 
+971 2 412 1712 
hyounes@cgsh.com  
RO ME  
Clara Cibrario Assereto 
+39 06 6952 2225 
ccibrarioassereto@cgsh.com

ALERT  ME MO RA ND U M  
 
2
I. 
The GCC’s unified ESG disclosure 
guidance 
Unified GCC sustainability disclosure guidance 
On January 9, 2023, the Exchanges Committee of the 
GCC launched a set of unified sustainability disclosure 
indicators, which may be adopted by all listed 
companies across the region.   
The new guidance creates ESG indicators across all 
3 pillars of sustainability: Environment (e.g. GHG 
emissions and climate risk mitigation), Social (e.g. 
child labor and global health), and Governance (e.g. 
board diversity and sustainability reporting). They 
comprise 29 indicators aligned with the World 
Federation of Exchanges (“WFE”) and Sustainable 
Stock Exchanges (“SSE”) Initiative. Please refer to the 
table below for a full list of the ESG indicators and 
their corresponding calculations.  
The WFE operates as the global industry association 
for exchanges and clearing houses worldwide. 
Members of the WFE include the Abu Dhabi 
Securities Exchange (“ADX”), Dubai Financial 
Market (“DFM”), as well as other stock exchanges in 
the GCC region. The SSE on the other hand provides 
an avenue for examining how exchanges and relevant 
stakeholders (such as listed companies, investors, and 
regulators) can boost corporate transparency, enhance 
ESG initiatives, and encourage sustainable investment.  
The GCC indicators are mapped against the Global 
Reporting Initiative (“GRI”)’s sector-agnostic general 
standards. The GRI, an international, not-for-profit 
organization, has developed a set of guidelines that are 
used by thousands of corporate and public sector 
reporting entities in over 90 countries. 
Pre-existing local sustainability disclosure regimes 
Stock exchanges in the Gulf region adopted their own 
individual sustainability disclosure standards prior to 
the implementation of the unified guidance.  
 
1 Our alert memorandum on the proposed ADGM 
sustainable finance regulatory framework is accessible here. 
Once in place, the framework will amend (among others) 
In the United Arab Emirates (“UAE”), each of the 
three stock exchanges (the ADX, DFM, and Nasdaq 
Dubai) has its own voluntary ESG disclosure 
guidance. On the regulatory front, financial free zones 
such as the Abu Dhabi Global Market (the “ADGM”) 
have also proposed their own disclosure guidance. 1  
Although the GCC’s new indicators are neither a 
comprehensive reporting framework nor a replacement 
for the existing disclosure standards, they should 
facilitate uniformity in ESG reporting by listed 
companies all across the region.  
Whilst the Exchanges Committee is not a regulator, the 
new unified ESG guidance are an indicator that the 
GCC is positively responding to regulatory, political, 
and market pressures in the area of ESG. Ahead of 
COP 28 (which will be held in the UAE later this 
year), stock exchanges in the GCC may play a 
significant role in advancing the ESG narrative. In 
2022, 51 IPOs were concluded in the Middle East and 
North Africa region. Of that number, the GCC had 27 
IPOs: the highest number witnessed so far in local 
regulated markets. 
Countries in the Middle East account for more than 
half of global oil reserves, with the GCC countries 
holding together approximately 47% according to data 
from the OPEC Annual Statistical Bulletin. 
Hence, as more companies in the region gear up for 
potential IPOs, and as the region begin to evolve into 
mature markets with respect to sustainability, the 
desire to be fully compliant with sustainability 
regulations, and even voluntary guidance, should begin 
to improve ESG disclosure among the largest 
companies in the region.  
We expect that these developments could 
exponentially increase the rate of the already booming 
foreign direct investment in the region, and expect to 
see such sustainability-related trend continue in 2023 
and beyond. 
the ADGM Companies Regulations, the Financial Services 
and Markets Regulations, the ADGM Conduct of Business, 
Funds, and Markets Rulebooks, and the FSRA Glossary.

ALERT  ME MO RA ND U M  
 
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II. 
Comparative remarks 
National/regional regulations 
The new GCC-wide ESG disclosure regime is, for 
now, entirely voluntary and only applies to listed 
companies. While a welcome step towards clarity and 
harmonisation in this area, some other countries and 
regions have gone further towards mandatory rules 
that apply more broadly. Since the approval of its 2019 
landmark “EU Green Deal”, the EU has notably 
affirmed itself as the global leader in  corporate 
sustainability policy and regulation. The EU 
framework so far has included in particular the 
overarching “green” Taxonomy Regulation2, the 
Sustainable Finance Disclosure Regulation on asset 
managers and fund disclosures (“SFDR”),3 the 
Corporate Sustainability Reporting Directive 
(“CSRD”) on generalised ESG disclosures for large 
and listed companies,4 and in the coming year perhaps 
also the Corporate Sustainability Due Diligence 
Directive that would create a system of accountability 
over companies’ negative ESG impacts.5  
More recently, several other regulators across the 
world have begun to similarly consider the need for a 
mandatory sustainability disclosure regime.  
This has notably included the U.S. and the UK.6 The 
US Securities and Exchange Commission issued draft 
disclosure rules for US-registered issuers in 2022. In 
December 2020, the UK’s Financial Conduct 
Authority (“FCA”) introduced a requirement for UK 
premium listed companies to make disclosures, on a 
comply-or-explain basis, in accordance with the 
recommendations of the Task Force on Climate-
Related Financial Disclosures (“TCFD”). The FCA 
rule has been extended to issuers of standard listed 
 
2 Our alert memorandum on the EU Green Taxonomy is 
accessible here. 
3  For more information on the Sustainable Finance 
Disclosure Regulation, see our January 2021 Alert Memo, 
available here. 
4 Our April 2022 alert memorandum on the CSRD is 
accessible here. The CSRD came into force in January 2023. 
Please see our recently published update here.  
shares and standard listed global depositary receipts 
representing equity shares. In addition, the FCA 
recently released the Sustainability Disclosure 
Requirements Consultation Paper which envisages 
transition plan disclosures for asset managers. Other 
countries, including in Asia, have made moves towards 
mandatory ESG disclosure regulations. These include 
jurisdictions such as Singapore, Malaysia, and Hong 
Kong. China’s first set of voluntary ESG guidance 
came into force in June 2022. 
 
International harmonisation efforts 
Notable initiatives have also developed at the 
international level, with a view to creating a set of 
baseline (albeit voluntary) global standards. The 
International Financial Reporting Standards (“IFRS”) 
Foundation have prepared the draft International 
Sustainability Standards Board (“ISSB”) standards for 
investors in 140 participating countries. The ISSB 
standards is a comprehensive global baseline of 
sustainability disclosure standards which subject 
entities are expected to apply for their 2024 reporting. 
The ISSB standards could potentially replace the 
current ESG disclosure regimes available in the 
relevant countries, including at some point in the GCC 
region (subject to adoption by the government in the 
relevant jurisdiction). Given the lack of uniformity in 
reporting guidelines on a regional and global basis, we 
believe that this initiative would, among other things, 
foster investors’ understanding of the relevant 
disclosure standards and a deeper meaning into what is 
being disclosed by companies. 
Other stock exchange rules  
Country regulators are not the only ones issuing rules 
in this space. Stock exchanges across the world have in 
5 For more information on the EU’s New Corporate 
Sustainability Due Diligence Directive, see our March 2022 
alert memorandum, available here.  
6 Our alert memorandum on Corporate Transition Plans in 
the UK, the EU, and the U.S. is accessible here.

ALERT  ME MO RA ND U M  
 
4
fact also come a long way in providing guidance on 
ESG disclosures for the companies that trade securities 
on their regulated facilities. In Asia-Pacific, stock 
exchanges lead the implementation of mandatory 
disclosures, with most of them having adopted a 
‘comply or explain’ policy for listed entities.  
In 2022, at least a dozen stock exchanges adopted their 
own ESG disclosure guidelines including Euronext 
Brussels (Belgium), Euronext Paris (France), Athens 
exchange Group (Greece), National Stock Exchange of 
India (India), and Johannesburg Stock Exchange 
(South Africa). Although these do not have proper 
regulatory nature and are overridden by national laws, 
they have overtime contributed to the development of 
market practice in the various jurisdictions.  
We have assembled below a colour-coded map which 
shows the current standing of sustainability disclosure 
rules for listed companies across the world. The chart 
focuses on the current wave of detailed, and strongly 
climate-focused, ESG disclosure rules, and does not 
take into account “lite” CSR-like (corporate social 
responsibility) and other similar “first generation” 
ESG disclosure regimes, which are not comparable to 
emerging rules by scope nor detail of the required 
disclosures.
 
 
New Generation Detailed ESG Reporting Rules

ALERT  ME MO RA ND U M  
 
5
Environmental 
Calculation 
Corresponding GRI Standard 
GHG Emissions 
1) Total amount in CO2 equivalents, for Scope 1 
2) Total amount, in CO2 equivalents, for Scope 2 
(if applicable)  
3) Total amount, in CO2 equivalents, for Scope 3 
(if applicable) 
GRI 305: Emissions 2016 
Energy Usage 
1) Total amount of energy directly consumed 
2) Total amount of energy indirectly consumed 
GRI 302: Energy 2016 
Energy Intensity 
Total direct energy usage per output scaling 
factor 
GRI 302: Energy 2016 
Environmental Operations 
1) Does your company follow a formal 
Environmental Policy? Yes/No 
2) Does your company follow specific waste, 
water, energy, and/or recycling polices? Yes/No 
3) Does your company use a recognized energy 
management system? 
GRI 103: Management Approach 
2016 
Climate Risk Mitigation 
Total amount invested, annually, in 
climate-related infrastructure, resilience, and 
product development 
 
Emissions Intensity 
1) Total GHG emissions per output scaling factor 
2) Total non-GHG emissions per output scaling 
factor 
GRI 305: Emissions 2016 
Energy Mix 
Percentage: Energy usage by generation type 
GRI 302: Energy 2016 
Water Usage 
1) Total amount of water consumed 
2) Total amount of water reclaimed 
GRI 303: Water and Effluents 
2018 
Environmental Oversight 
(Management) 
Does your Management Team oversee and/or 
manage sustainability issues? Yes/No 
GRI 102: General Disclosures 
2016 
Environmental Oversight 
(Board) 
Does your Board oversee and/or manage 
sustainability issues? Yes/No 
GRI 102: General Disclosures 
2016 
Social 
Calculation 
Corresponding GRI Standard 
CEO Pay Ratio 
1) Ratio: CEO total compensation to median Full 
Time Equivalent (FTE) total compensation 
2) Does your company report this metric in 
regulatory filings? Yes/No 
GRI 102: General Disclosures 
2016 
Employee Turnover 
1) Percentage: Year-over-year change for full-
time employees 
2) Percentage: Year-over-year change for part-
time employees 
3) Percentage: Year-over-year change for 
contractors/consultants 
GRI 401: Employment 2016

ALERT  ME MO RA ND U M  
 
6
Temporary Worker Ratio 
1) Percentage: Total enterprise headcount held by 
part-time employees 
2) Percentage: Total enterprise headcount held by 
contractors and/or consultants 
GRI 102: General Disclosures 
2016 
Injury Rate 
Percentage: Frequency of injury events relative to 
total workforce time 
GRI 403: Occupational Health and 
Safety 2018 
Child & Forced Labor 
1) Does your company follow a child and/or 
forced labor policy? Yes/No 
2) If yes, does your child and/or forced labor 
policy also cover suppliers and vendors? Yes/No 
GRI 103: Management Approach 
2016 
Gender Pay Ratio 
Ratio: Median male compensation to median 
female compensation 
GRI 405: Diversity and Equal 
Opportunity 2016 
Gender Diversity 
1) Percentage: Total enterprise headcount held by 
men and women 
2) Percentage: Entry-and mid-level positions held 
by men and women 
3) Percentage: Senior- and executive-level 
positions held by men and women 
GRI 102: General Disclosures 
2016 
GRI 405: Diversity and Equal 
Opportunity 2016 
Non-Discrimination 
Does your company follow non-discrimination 
policy? Yes/No 
GRI 103: Management Approach 
2016 
Global Health & Safety 
Does your company follow an occupational 
health and/or global health & safety policy? 
Yes/No 
GRI 103: Management Approach 
2016 
Human Rights 
1) Does your company follow a human rights 
policy? Yes/No 
2) If yes, does your human rights policy also 
cover suppliers and vendors? Yes/No 
GRI 103: Management Approach 
2016 
Governance 
Calculation 
Corresponding GRI Standard 
Board Diversity 
1) Percentage: Total board seats occupied by men 
and women 
2) Percentage: Committee chairs occupied by 
men and women 
GRI 405: Diversity and Equal 
Opportunity 2016 
Incentivized Pay 
Are executives formally incentivized to perform 
on sustainability? 
 
Ethics & Prevention of 
Corruption 
1) Does your company follow an Ethics and/or 
Prevention of Corruption policy? Yes/No 
2) If yes, what percentage of your workforce has 
formally certified its compliance with the policy? 
 
Sustainability Reporting 
Does your company publish a sustainability 
report? Yes/No

ALERT  ME MO RA ND U M  
 
7
External Assurance 
Are your sustainability disclosures assured or 
verified by a third-party audit firm? Yes/No 
GRI 103: Management Approach 
2016 is to be used in combination 
with the topic specific Standards 
Board Independence 
1) Does company prohibit CEO from serving as 
board chair? Yes/No 
2) Percentage: Total board seats occupied by 
independent board members 
 
Supplier Code of Conduct 
1) Are your vendors or suppliers required to 
follow a Code of Conduct? Yes/ No 
2) If yes, what percentage of your suppliers have 
formally certified their compliance with the code? 
 
Data Privacy 
1) Does your company follow a Data Privacy 
policy? Yes/No 
2) Has your company taken steps to comply with 
GDPR rules? Yes/No 
 
Disclosure Practices 
1) Does your company provide sustainability data 
to sustainability reporting frameworks? Yes/No 
2) Does your company focus on specific UN 
Sustainable Development Goals (SDGs)? Yes/No 
3) Does your company set targets and report 
progress on the UN SDGs? Yes/No 
 
 
Unified GCC ESG Disclosure Indicators 
… 
CLEARY GOTTLIEB