Today, the Dubai Financial Market launched the Emirates Index on Social and Environmental Governance and Responsibility, which is the first of its kind among the UAE and Gulf financial markets to measure the adoption of public shareholding companies listed in the local financial markets to the best practices of governance, social and environmental responsibility.
The market stated in a statement that the "S & P / Hawkamah UAE ESG Index" governance, social and environmental responsibility in Emirati companies has been prepared in cooperation with the S&P Dow Jones, which operates in the field of capital market indicators And the Corporate Governance Institute in the Emirates "Hawkamah", the strategic partner of the Dubai Financial Market in the field of spreading best practices of corporate governance and corporate discipline among the companies listed on the market.
The Minister of Economy and Chairman of the Board of Directors of the Securities and Commodities Authority, Eng. Sultan bin Saeed Al Mansoori, said that the launch of the index is in line with the efforts of the Authority and supports its efforts in developing the supervisory and control system to match the best international standards and practices in order to elevate the culture of governance and cement investor confidence in the country's capital markets, especially After adopting the corporate governance guide for public joint-stock companies at the beginning of 2020, which regulates the requirements of corporate governance, social responsibility and environmental responsibility.
For his part, Chairman of the Dubai Financial Market, Issa Kazim, said, "The new index provides customers with a transparent and reliable benchmark tool that monitors the performance of corporate stocks in accordance with its commitment to the rules of governance, social and environmental responsibility."
He added that "there is no doubt, the correct application of governance and institutional discipline and adopting the highest levels of disclosure, transparency and social and environmental responsibility in accordance with the best international standards in the listed companies enhances the competitiveness of the financial markets in the country and contributes to attracting more investments and ensures the sustainability of growth, in light of the presence of large numbers of Investment institutions around the world attach increasing importance to the extent to which listed companies adhere to these practices as one of the main elements of investment decision-making.
In turn, the CEO of the Securities and Commodities Authority, Dr. Obaid Al-Zaabi, affirmed that the new indicator, in addition to being an important measurement tool, would contribute to raising
The level of awareness of the importance of activating the principles of corporate governance that are included in the new Corporate Governance Guide for public joint-stock companies and that it recommends the spirit of competition and the commitment of the boards of directors of listed companies to apply those principles, as well as developing comparative indicators of the performance of those companies, especially with regard to adherence to the principles of social and environmental responsibility
In the same context, the Chairman of the Board of Directors of "Hawkamah", Dr. Ahmed bin Al Sheikh, said that "the launch of the Governance and Social and Environmental Responsibility Index comes at an ideal time in order to encourage responsible institutional behaviors and foster a spirit of competition between listed companies and enhance its eagerness to grant issues related to governance and responsibility Social and environmental interest in the context of managing these companies ’business.”
He explained that the opening sample of the index in companies includes 20 companies, where the index data is available retroactively for five years, allowing customers to monitor its performance since the year 2015, and the index can also be monitored through the DFM website and other data transmission platforms.
For his part, S&P Dow Jones, Global Head of Governance, Social and Environmental Responsibilities, at S&P Dow Jones, said that "S&P Dow Jones" is developing innovative indicators of governance, social and environmental responsibility, as well as providing research and data that enables customers In the global financial markets to achieve their goals related to investment and sustainability alike, we are pleased to launch this new indicator in the Emirates in light of the increasing number of investors to include best practices of governance, social and environmental responsibility in their investment decisions. ”
All companies covered within the scope of the index coverage are subject to an evaluation process according to three measures, the first of which relates to transparency and disclosure based on companies ’disclosures regarding the application of the standards of governance, social and environmental responsibility. The second scale focuses on the environment and social indicators, while the third scale focuses on governance indicators.
The evaluation process monitors all information related to corporate disclosures on indicators of governance and social and environmental responsibility contained within several sources, including the company's annual report, website, press releases and / or disclosures provided to the market.
The ultimate goal of this process is to determine the extent to which the company provides transparent disclosures in these reports on the indicators included in the evaluation system of governance, social and environmental responsibility.