The discourse surrounding environment, social and governance (ESG) has often underscored the need to move from metrics that appear on annual reports to more tangible, year-round impact. While businesses across the globe have begun to rise to this challenge, the UAE in particular has emerged with some promising statistics: during the 2026 edition of the Abu Dhabi Sustainability Week, a Global Sustainability Pulse Survey by HSBC showed that UAE businesses are embracing sustainability faster than companies in most other markets. Indeed, the report showed that 94% view the climate transition as a commercial opportunity and not just a compliance requirement, while 90% plan to accelerate related investments over the next three years — significantly above the global average. Moreover, the report highlighted that UAE firms are moving ahead of the global average in adopting green technologies and resilient infrastructure.

That final finding aligns neatly with a rising sentiment amongst investors across the board: awareness of ESG factors has grown rapidly as investors look beyond profit to long-term risk and resilience. A study by Statista reveals that ESG-focused investment vehicles have expanded sharply, with ESG exchange traded funds (ETFs) reaching over US$640 billion in assets by late 2024 – a move that signals that sustainability is no longer niche. A 2025 study by KEY ESG, on the other hand, shows that “ESG is considered by 89% of investors when making investment decisions.” But the same study also highlights a jarring situation: 30% of investors currently have difficulty finding suitable and appealing ESG investing options.

Serving as the missing link between businesses and the right ESG-focused infrastructure are economic zones designed around sustainability. The Ras Al Khaimah Economic Zone (RAKEZ) has emerged as one such example in the UAE. Through its ability to demonstrate how infrastructure can translate ESG ambition into operational reality, RAKEZ has allowed businesses to inherit systems already aligned with global ESG expectations.

Location as an ESG Multiplier

Perhaps the biggest catalyst in this overall shift has been the quiet realizations that ESG performance is no longer shaped solely inside boardrooms, but also by the environments in which companies operate. Investors are increasingly assessing where a business is located as much as how it is run.

As such, operating environments can either support or hinder a company’s ESG commitments. Factors such as energy efficiency, emissions exposure, waste handling systems, environmental compliance, workplace health and safety standards, and governance frameworks now feed directly into investment risk assessments. 

For many startup founders and small business owners, however, attempting to build these capabilities independently and from scratch can burn a significant hole in their pockets. As an ESG-aligned zone, RAKEZ reduces that burden by embedding energy efficiency, safety, and environmental compliance into its infrastructure, allowing companies to meet investor expectations from day one rather than retrofitting sustainability later.

A recent partnership underscores this approach in practice. During the Ras Al Khaimah Investment Summit, RAKEZ signed a strategic MoU with Emerge — the joint venture between Masdar and EDF — to accelerate renewable energy adoption across its ecosystem. The collaboration will deploy solar, energy storage, and hybrid clean energy solutions, supporting companies in lowering emissions and operational costs while aligning with the UAE’s Net Zero 2050 goals and Ras Al Khaimah’s Energy Efficiency and Renewable Energy Strategy 2040.

ESG-Aligned Infrastructure as Risk Management

For investors, ESG-ready infrastructure functions as a form of risk insurance. Operating within environments governed by recognised environmental, health, safety, and energy management standards lowers regulatory and compliance exposure, reduces the likelihood of environmental or workplace incidents, and strengthens business continuity. 

Standardised systems also minimise operational inconsistencies, an issue that often undermines ESG performance across multi-site operations.

At RAKEZ, businesses benefit from zones aligned with internationally recognised frameworks such as ISO 14001 for environmental management, ISO 45001 for occupational health and safety, and ISO 50001 for energy management. 

For new entrants in particular, this means ESG alignment is embedded from the outset rather than added later as a costly corrective exercise.

Sustainability Without the Cost Premium

A persistent misconception is that ESG-aligned operations inevitably raise costs. In practice, shared infrastructure often delivers the opposite. 

Centralised energy-efficient buildings, integrated waste management systems, and common environmental controls can improve resource efficiency while avoiding duplication of investment. For businesses operating within RAKEZ, access to these systems allows environmental objectives to be met alongside operational efficiency and cost control. The result is a model where sustainability supports competitiveness rather than constrains it — an outcome increasingly attractive to investors focused on predictable, long-term returns.

Beyond the “E”: How RAKEZ Focuses on Social and Governance Policies 

Investor scrutiny, however, can sometimes be misconstrued as being limited only to the sustainability results that businesses can show. That couldn’t be further from the truth. The social and governance elements of ESG such as workplace safety, labour accommodation standards, employee wellbeing, data privacy, and operational security now carry significant weight in funding decisions.

Recognition received by RAKEZ for its workplace safety practices and labour accommodation standards reflects these evolving expectations around the “S” in ESG. The most recent validation of this approach came in November 2025, when RAKEZ was awarded first place in the “Small to Medium Labour Accommodations” category at the Emirates Labour Market Award, presented by the Ministry of Human Resources and Emiratisation and honoured by HH Sheikh Theyab bin Mohamed bin Zayed Al Nahyan. The recognition highlighted RAKEZ’s investment in high-quality accommodation infrastructure, welfare services, and sustainability measures designed to enhance workforce stability and quality of life — factors increasingly scrutinised by international investors and supply-chain partners.

Similarly, governance frameworks that prioritise data protection and operational transparency align with the requirements of international partners and lenders assessing long-term risk.

The Value of Independent Recognition

In an era where greenwashing concerns remain high, third-party validation has become essential. Independent awards and certifications offer investors assurance that ESG commitments are embedded into systems rather than confined to marketing narratives.

RAKEZ’s repeated regional and international recognition for waste reduction, corporate social responsibility, and workplace standards signals sustained performance rather than one-off initiatives. For institutional investors in particular, such consistency provides confidence that ESG claims are supported by measurable outcomes.

From Paper to Infrastructure

The evolution of ESG is therefore changing the very geography of investment. Where sustainability was once assessed through policies and disclosures, it is now being judged by the quality of the infrastructure that surrounds businesses, i.e. the energy they use, the standards they operate under, and the ecosystems that support their growth. 

For investors, these factors increasingly determine resilience as much as revenue.

This shift has elevated the role of economic zones from passive hosts to active enablers of ESG performance. By embedding internationally recognised standards into the foundations of its ecosystem, RAKEZ enables companies -especially startups and SMEs- to participate in global value chains without bearing the full cost of building ESG capabilities alone. What has thus emerged is a model where sustainability, efficiency, and competitiveness advance together.