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August 16 2022 6:25 AM ˚
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Jordan’s green ocean strategy

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(Photo: Freepik)
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Hamzeh S. Al-Alayani

The writer is a board member of a Jordanian public-sector government investments management company and a regular commentator on regional energy and industrial matters.

Jordan’s primary policy on climate change is the National Climate Change Policy and Sector Strategic Guidance Framework. The country emphasizes adaptation, rather than mitigation, intending to achieve socio-economic development and environmental resilience. Priority sectors include water, agriculture, energy, land use, and desertification. Climate adaptation and mitigation for green growth have proven challenging and remain highly conditional on the availability of financing.اضافة اعلان

 Jordan’s general budget has been in chronic deficit, and the economy remains highly vulnerable to external shocks. Given the gap between Jordan’s climate goals and its public finances, climate action will require a shift in national planning and budgeting to allocate domestic resources for mitigation and adaptation. Therefore, the growing business imperative to address sustainability, despite the Kingdom’s risks, is broadening and becoming more complex. The mounting risks have led to a global sustainability movement driven by capital markets, communities, and various stakeholders. The demand for accountability in environmental, social, and governance (ESG) matters calls for a better understanding of the impact of business and industry on the environment and society.

The structuring of a sustainable financing framework should be a strategic step in line with the Kingdom’s vision aiming at sustainability and ESG commitment.

Bloomberg Intelligence expects ESG investments to reach over $50 trillion by 2025, meaning that ESG investments at the time would account for one-third of global assets under management. Ultimately, government and private sector leaders must increasingly consider ESG as part of their DNA, irrespective of industry and geographic exposure. This macro trend is gaining momentum in overall strategy.

Europe is leading the way, with over 80 percent of global ESG assets concentrated on the continent. ESG, as a concept, is relatively new in the Middle East. Still, it is critical to Jordan’s ambition that needs to embrace it, as it is central to its effort to develop a more sustainable economic landscape that can drive long-term economic growth.
Jordan needs a Green Ocean Strategy to excel in ESG guidelines and act as a catalyst to reach a continuously innovative and sustainable approach by utilizing primarily its human intellectual capital in an unbiased and democratic way.
A strong ESG proposition allows companies to tap into new markets and expand into existing markets. ESG can be part of government incentives for companies that contribute to society, and which should be more easily awarded licenses, access, and approvals to grab opportunities for growth while creating social value.

Improving ESG performance comes with many benefits: reduced costs, better stock performance, and increased customer and employee loyalty. One key stakeholder group is that of employees, especially within the “start-up” ecosystem. Today, the demographic group of millennials makes up the majority of the workforce, followed by Gen Z. Together, they account for almost half of the workforce population. These two groups are amenable to adopting ESG-related corporate visions, missions, and ambitions. A strong ESG proposition can help attract talented employees to the organization.

There are several ways ESG can help lower operating expenses. It often focuses on reducing energy consumption, which can help companies save money on utilities. It emphasizes strategies to reduce water and raw material usage. ESG can help companies save money by eliminating waste and improving resource efficiency as these resources become more expensive.

Companies need a robust set of tools that will help them track, report, and manage resource usage, carbon emissions, safety performance, and other metrics to drive greater efficiency and better financial performance. McKinsey found that ESG strategies can affect operating profits by as much as 60 percent.

Jordan needs a Green Ocean Strategy to excel in ESG guidelines and act as a catalyst to reach a continuously innovative and sustainable approach by utilizing primarily its human intellectual capital in an unbiased and democratic way. This strategy should include a business transformation framework and serve as a powerful vehicle to raise awareness about the importance of ESG among Jordanian companies, and encourage companies to disclose and report their ESG performance. At the same time, the government offers the companies structure and support in their ESG journey, moving forward with renewable energy, water, electricity, and carbon-management projects.


Hamzeh S. Al-Alayani is a board member of a Jordanian public-sector government investments management company and a regular commentator on regional energy and industrial matters.


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