Ecoryx Experts Take on What’s Ahead

As the Kingdom and MENA region accelerate toward Vision 2030 and net zero commitments, sustainability is becoming the new business baseline. Companies now face mounting ESG reporting requirements, investor scrutiny, and regulatory pressure that will reshape competitive landscapes in 2026.

Whether you’re a Saudi SME navigating new disclosure demands, a MENA exporter preparing for CBAM compliance, or a regional enterprise aligning with ISSB standards, understanding these seven priorities is critical to staying ahead.

In this article, our Ecoryx experts share 7 main priorities and trends that will play a key role in reshaping how businesses operate in 2026 and beyond. While these directions are global, sooner or later our region will be impacted.

Decarbonizing Industries with Transition Finance

Sitting under the umbrella of sustainable finance, transition finance helps high-emission or “hard-to-abate” sectors move toward lower emissions. Unlike green finance, which funds already sustainable projects, it finances the transformation of existing carbon-intensive industries in line with climate goals.

According to the IEA, over the next decade, transition finance could support USD 4–5 trillion in cumulative investment (USD 400–500 billion per year), with over half flowing to emerging markets and developing economies (EMDEs)². Key areas include energy efficiency, low-emissions technologies, and strategic infrastructure such as gas power and critical minerals.

As green finance evolves, transition finance is becoming a critical tool to decarbonize industries while driving inclusive, climate-aligned growth

Supply Chain Transparency Is Non-Negotiable 

Your company’s sustainability performance is no longer measured by your operations alone. The entire value chain is now on the table, and stakeholders are asking hard questions about every link 

Transparency was once optional, limited to sustainability reports. Today, it dictates customs clearance, financing approvals, and contract renewals. Every link in the supply chain faces scrutiny: regulators demand verified data, investors seek visibility on labor and environmental practices, and customers expect ethical sourcing. 

At the global level, this shift is being formalized through regulation. The EU Corporate Sustainability Due Diligence Directive (CSDDD) entered into force in 2024, with EU member states required to transpose it into national law by 26 July 2026 and obligations phasing in on a staggered timeline. The directive establishes enforceable human rights and environmental due diligence requirements across entire value chains. 

Companies in the MENA region are not immune. With CBAM’s full implementation starting on 1 January 2026, carbon transparency becomes mandatory for MENA exporters to the EU, particularly in aluminum, steel, cement, and fertilizer sectors. 

AI and Digital Tools Become ESG Necessity 

A single performance system will emerge in 2026 as AI and sustainability converge. AI and sustainability won’t live in separate strategies, they’ll power the same engine together 

Today, AI and digital ESG platforms are shifting from “nice-to-have” tools to operational necessities. Manual processes can no longer keep pace with modern ESG requirements. Market estimates indicate adoption will grow at 28.2% annually between 2025 and 2034, reflecting more than technology hype, companies recognize that ESG data is complex, regulations are detailed, and investor demands are immediate. 

The applications are transformative. AI automates data collection across operations, improves accuracy while reducing human error, predicts climate and supply-chain risks, streamlines compliance reporting, and converts vast datasets into strategic insights 

By moving ESG from lagging indicators to forward-looking, real-time intelligence, AI enables companies to anticipate climate risks, regulatory changes, and social controversies before they impact enterprise value and investor confidence 

Greenwashing Backlash Intensifies 

In 2023, one in every four climate-related ESG risk incidents was tied to greenwashing, up from one in five the year prior. The financial consequences are real: firms accused of greenwashing experience an average 1.34% decline in consumer trust. 

Regulatory crackdowns are accelerating globally. The EU’s Green Claims Directive becomes applicable by 2026, while the U.S. SEC tightens reporting standards. For MENA exporters, the EU’s Carbon Border Adjustment Mechanism (CBAM) enters full implementation on January 1, 2026, requiring verified emissions declarations. Any greenwashing in carbon reporting now carries trade restrictions, particularly for high-risk sectors. 

Investors now demand externally verified sustainability data, driving explosive growth in external sustainability assurance services as companies scramble to validate their claims 

Nature-Related Reporting Takes Center Stage 

Nature and biodiversity are no longer environmental afterthoughts. They’re now recognized as essential economic infrastructure by governments, investors, and global institutions 

Regulatory frameworks are developing rapidly. The International Sustainability Standards Board (ISSB) is creating nature-related disclosure requirements based on the TNFD framework, with an Exposure Draft expected by COP17 in October 2026. At the same time, the GRI Biodiversity Standard takes effect in January 2026, requiring companies to report biodiversity impacts across their entire value chains.  

Sectors with direct ecosystem dependencies,  such as agriculture, mining, and manufacturing, will face increasing pressure to demonstrate robust nature-related risk management. 

Investors are already shifting capital toward biodiversity bonds, nature-based solutions, and debt-for-nature swaps. Nature is transitioning from niche topic to a mainstream sustainable finance pillar 

Climate Adaptation Strategies Rise to Priority 

As climate-related disruptions grow more frequent and severe, businesses worldwide are moving toward near-term adaptation action alongside long-term mitigation efforts 

As climate-related disruptions grow more frequent and severe, businesses worldwide are shifting focus from long-term mitigation alone to urgent near-term adaptation. 

Mitigation which aims at reducing carbon emissions, will remain essential. But it addresses the cause, not the immediate consequence. Adaptation tackles what’s already happening: floods, droughts, heatwaves, and extreme weather threatening operations today. 

Climate adaptation means proactively adjusting systems, processes, and infrastructure to reduce exposure to physical climate risks before they become crises. 

For businesses, adaptation means:  

• Mapping climate vulnerabilities 
• Retrofitting facilities for extreme weather resilience 
• Redesigning supply chains by diversifying suppliers across climate zones, building redundancy before disruptions become crises 

Companies integrating adaptation into their core strategy now will ensure operational continuity as climate volatility intensifies 

SMEs Under the Sustainability Spotlight 

By 2026 and beyond, SMEs worldwide will face a global push toward ESG reporting. What was once a differentiator is becoming a baseline requirement 

ESG reporting has traditionally targeted large corporations, while SMEs operated outside regulatory requirements with no formal sustainability obligations. 

But that’s changing. SMEs worldwide now face mounting pressure from banks, investors, and major customers demanding ESG disclosures. The gap is alarming: according to EcoVadis (2025), 72% of SMEs worldwide still operate without a carbon-reduction plan, a weakness rapidly becoming a competitive liability affecting access to capital and partnerships. 

To bridge this gap, simplified frameworks are emerging. A leading example is the Voluntary Sustainability Reporting Standard for SMEs (VSME), officially recommended by the European Commission. VSME is expected to gain significant traction throughout 2026 as financial institutions and corporations begin requesting VSME-aligned data. While directly impacting Europe first, MENA is following close behind. As the region’s major corporations and financial institutions align with global standards, SMEs across Saudi Arabia, the UAE, and other markets will soon face similar ESG disclosure demands.  

At Ecoryx, we remain committed to supporting the Kingdom’s sustainability and net zero journey. Our mission is to empower organizations to excel and stay ahead in today’s competitive landscape. As these priorities reshape business in 2026, we’re here to guide MENA companies through every step of their ESG transformation. Learn more about how we can help you.