The Global Compact in the Emirates

In just 20 years, the countries of the Gulf Cooperation Council (GCC) have transformed themselves from deeply traditional nations that depended largely on oil revenues to booming metropolises with rapidly growing and diversified economies. The transformation – especially in the United Arab Emirates (UAE) has been staggering; once home to a small and tight knit society, the UAE today boasts over 202 different nationalities, making it one of the most diverse nations in the world. The rapid development of the region is accompanied by a greater call for a more responsible and sustainable way of doing business, in order to solidify the progress that is being made.

The UN Global Compact is gaining momentum all over the world and the Gulf Region is no exception to this trend. One of the world’s fastest-growing regions in terms of economy as well as demographically, the Gulf Region presents the UN Global Compact with a unique opportunity to make a firm and lasting impact on the way that business is conducted in this part of the world. As the UN Global Compact Local Network focal point for the GCC states, the Emirates Environmental Group has been actively engaging local and regional businesses, government, and semi-government organizations since 2007.

Certain aspects of Corporate Social Responsibility (CSR) have a long history in this region (philanthropy is one of the five pillars of Islam), but until recently, CSR as a comprehensive, long-term business model was largely unknown in the GCC. Although national governments have been quick to recognize the environmental implications of the massive growth of their economies, and have taken innovative steps to reverse this trend (Masdar City, the world’s first Carbon Neutral city in the Emirate of Abu Dhabi is one particularly notable example), there are other areas where legislation is lagging behind the fast-paced developments on the ground.

Emirates Environmental Group (EEG) has been playing a central role in convincing businesses and the general public that it is imperative that both local and international companies step up and – voluntarily – take up the responsibility of doing more than is minimally required of them.

Increasingly, companies in the GCC are realizing that there is more to Corporate Social Responsibility than just PR value, and they are starting to incorporate CSR principles into the core values of their businesses. As is to be expected of dynamic and varied economies, the CSR initiatives being undertaken by GCC businesses vary greatly in scale, quality, and sustainability. Nevertheless, the enthusiasm with which the UN Global Compact has been received by companies, government, and semi-government organizations in the GCC proves that there is great potential to achieve truly sustainable growth.

Two years of diligent preparation, raising awareness of the UNGC in the GCC states, and developing a local framework culminated in the official launch of the UNGC Local Network for the GCC states on April 7, 2008. The festive occasion brought high-level representatives from government, semi-government and the private sector together for the official ceremony. The event even received the patronage of the Crown Prince and chairman of the Executive Council of Dubai, HRH Prince Hamdan bin Mohammed bin Rashid al Maktoum, underlining the support that the UNGC enjoys in the highest levels of government.

The UNGC executive director, Mr. Georg Kell, provided the keynote speech, while other speakers included Mrs. Habiba al Marashi, and Steering Committee members Mr. Mohammed Al Sarhan and Mr. Rami Ghandour. In addition to the 17 companies that had already signed up before the official launch, another organization joined the UNGC Local Network at this event. The high-level guests and impressive media turnout gave the launch excellent media coverage and subsequently helped further raise the profile of the UNGC Local Network with the general public.

The Emirates Environmental Group acts as the focal point for the UNGC Local Network. The EEG’s chairperson, Mrs. Habiba Al Marashi, sits on the UN Global Compact board. The diversity of the GCC is perfectly exemplified in the UNGC Local Network for the GCC Secretariat office, where people from 12 different countries work together to advance the principles of the UNGC in the GCC.

Although the secretariat of the Local Network is based in Dubai, UAE, the Network aims to actively involve participants from all GCC states. Reflecting this aim, the steering committee for the Local Network consists of participants from the UAE, Qatar, and Saudi Arabia. The goal is to further expand this Steering Committee, so that its members truly reflect all countries of the GCC. Ideally, each country will be represented by both a member of a government entity and a representative from the corporate world. The current members of the Steering Committee aim to convene at least three times a year, with the location of the meeting rotating between them.

The UNGC Local Network has been off to a flying start. Introducing the UNGC in the region that was largely unfamiliar with the Initiative and its principles, we initially set out to raise awareness among our existing members and the general public. Support has been steadily growing and we consequently rolled out a number of lectures, workshops, and documentation to further familiarize organizations in the region with the UNGC.

We also provide our participants with access to CSR experts and resource speakers to further strengthen their own CSR practices. The Local Network has represented the UNGC at three international forums; the First Alliance of Civilizations Annual Forum (Madrid, January 15–16, 2008), the Second Forum of Ministers for Social Development (Amman, November 12–14, 2008), and the Business for the Environment Global Summit (Singapore April 22–23, 2008).

In addition to officially representing the UNGC at high-level events, we have committed ourselves to lobby for greater UNGC participation whenever the (speaking) opportunity arises. Perfect examples of such opportunities were the International Business Forum
(Doha, November 28, 2008) and the CSR networking event hosted by the Dubai Chamber of Commerce, where the EEG chairperson, in the capacity as guest speaker, encouraged businesses to join the UNGC.

In addition to public speaking engagements, the Local Network Steering Committee convened twice in the past year. The Local Network was also represented at the UNGC board meeting, with Mrs. Al Marashi present in New York (April 30–May 1, 2008).

The UNGC Local Network for the GCC states was launched under the patronage of Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Dubai’s Crown Prince and the chairman of the Executive Council. His involvement with the UNGC Local Network and with its launch has been extremely beneficial to the Network in terms of credibility and publicity. In this region, having the government’s seal of approval is crucial to engaging key players in society, and the Crown Prince’s patronage has proven to be very helpful in this process.

The UNGC Local Network currently has 34 active participants spread out over five GCC states, while the applications for two more memberships are currently being processed. The participants are heterogeneous, with MNC’s, SME’s, and local companies all participating. Reflecting the GCC’s economy, the majority of participants are Construction and Engineering companies, with the Professional and Scientific and Oil&Gas enterprises coming in second and third place, respectively.

As a relatively young Local Network, the UNGC Local Network for the GCC set out with a dual policy: to actively recruit new participants to the UNGC and to engage those businesses that had already signed up globally to become active participants locally. In this it has largely been successful. Businesses across the region are becoming more aware of the benefits of participating in a Local Network, and the Local Network focal point, in turn, has been stepping up its efforts to actively engage its Local Network participants. This too has paid off. UNGC global initiatives such as the CEO Water Mandate, the Caring for Climate statement, the CEO statement on the UN Convention against Corruption, and the CEO statement on Business and Human Rights were all endorsed by businesses from the GCC. In addition to these initiatives, one of the GCC Local Network participants became the first business from the Middle East to donate to the UN Central Emergency Response Fund (CERF) by answering the Secretary General’s call to donate to the Gaza Relief Fund.

Among the participants of the UNGC Local Network for the GCC, there are varying motivations for joining the Network. In a participant survey held in 2008, respondents cited the desire to build knowledge and capacity for CSR as their top reason for joining the UNGC. Improving stakeholder relationships and building trust came in as a close second. The fact that companies cite these objectives as being more important than just networking opportunities and PR value is a clear sign that the long-term value of responsible business is sinking in with companies in the region.

The greatest challenge that we currently face is convincing businesses in the GCC region that the current financial crisis should not be an excuse to downsize their CSR efforts. An unfortunate side effect of the fact that CSR is relatively new in this region is that its position as an integral business component has not yet been completely solidified in many businesses. In the wave of company downsizing that has also affected the GCC, departments dealing with CSR issues have been among the hardest hit. The UNGC Local Network for the GCC is acutely aware of these developments and is actively reaching out to existing and potential participants to try and reverse this trend.

The Network’s first workshop of 2009 was focussed on doing “Sustainable Business in the Current Economic Climate”. Featuring prominent guest speakers from the public and the private sectors, the workshop underlined the importance of sound CSR practices in this economic climate. According to the Director of Sustainability for Deloitte, “Corporate responsibility and Sustainability are an imperative, because those companies that fail to address CSR will find themselves on the path to corporate extinction.” His strong message was echoed by the CSR manager of the Dubai Chamber of Commerce and Industry, who told the audience that “Environmental challenges like global warming will not go away. They will intensify, causing an array of social challenges too.” Both speakers proceeded to present the audience with an outline of practical steps that can be taken to ensure responsible and sustainable business practices in the current climate.

As the UNGC Local Network for the GCC focal point, we consider it to be our responsibility to continue to spread the message of the importance of CSR, especially in this current climate. Issues such as transparency, responsible investment, and managing human capital are now more pressing than ever, and communicating this to government, semi- government, and private organizations across the region is our top priority in these trying times.

The GCC has successfully transformed itself into a global financial hub, with the UAE standing out as a shining example of a modern, open, and progressive Arab nation. Several progressive leaders of the countries in the Gulf have been lavished with praise and admiration for their visionary approaches to the development of their countries. The people of the GCC are rightfully proud of the immense leaps that they have taken in such an incredibly short time. It is, however, too soon to sit back and rest on our laurels. With the privileges of development also come the responsibilities. As His Highness Sheikh Mohammed said: “It would be both unfair and selfish to sit back and let others deal with our shared responsibility towards the environment and the society that we all live in.”

At the EEG, we work towards yet another transformation of the GCC – from capital-driven development to a fully inclusive and sustainable society that honours its rich heritage while leading the way towards an equitable and responsible future for all who call this region home.