In a keynote address at the recent WBCSD/ICC Global Business Day event at COP18, Doha, Yvo de Boer, KPMG’s special global advisor on climate change and sustainability, said companies in the region should be on red alert.
He pointed to a unique combination of climate change, water scarcity, energy and fuel pressures that pose particular risks to businesses in the Gulf Cooperation Council (GCC), calling on the region’s business leaders to act now.
“Countries in the GCC make up a region that currently has the lowest energy efficiency in the world, and arguably the most to gain from improvements in business strategy and innovation. We are not talking about green wash or PR, we are talking about serious innovation, growth, productivity and risk reduction in order for Gulf countries to remain profitable into the future,” said de Boer.
Referencing a new KPMG International study into the unique business risks facing the GCC region entitled, Future-proofing business in the GCC – Opportunities for Sustainable Growth, de Boer said: “Maintaining business as usual is not an option if GCC goods are to remain competitive and the region’s companies are to represent attractive opportunities for global investors and business partners alike.”
Calling it a “wake-up call” to businesses unaware of or not responding to the significant shifts happening in the region, de Boer said KPMG found that just 11% of the 75 largest companies in the GGC have a sustainability strategy, policy or vision compared to 95% in Europe and 85% in America.
Per capita energy consumption in the region is already high with UAE, Qatar and Kuwait among highest in the world, and predicted to double between 2008 and 2020.
“The extraction of fossil fuels will never be completely environmentally friendly and it is unrealistic to expect a wholesale shift away from these resources in the short term. The challenge, therefore, is to put commodities and goods into the market in a way that minimises damage.”
The report revealed that energy and fuel: domestic consumption is becoming a significant portion of daily production, eg around 30% in Saudi Arabia, affecting oil exports and financial returns for the government.
According to the study, the world is on course for a long term global temperature rise of 3.5˚C – predicted to be 4˚C by 2100 in the GCC region resulting in storms, cyclones and sea level rises which could threaten desalination plants.
