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Corporate Sustainability in Saudi Arabia

There is a pressing need to create the culture of sustainability in the Kingdom

With the growing challenges facing countries around the world, a bigger and more structured role for the private sector in development is becoming more and more evident. Governments alone find themselves unable to solve some of these pressing and increasingly complex issues and require the support of the private sector. In this context Corporate Social Responsibility started picking momentum around the world. And as it spread, it started facing challenges and evolved to corporate sustainability where these efforts become part of corporate strategy thus transforming socio-economic and environmental threats to business opportunities. Whether we call it corporate social responsibility or corporate sustainability it all zooms down to a bigger role for the private sector in development and its capacity for implementation and making higher impact.
In Saudi Arabia, the corporate sector has invested more than 125 billion Saudi Riyals in 2011 on philanthropy and community service (as per McKinsey study Feb 2012), yet unemployment rate is still increasing, water scarcity remains among the top development challenges, 3 million Saudi live under poverty lines, obesity and diabetes are spreading among children, as well as many other challenges..
As much as this reflects a gap that is leading to a limited impact of such investment, it also reflects the willingness of the private sector to give and cooperate and play a role in solving development challenges. In this context, we ask ourselves the question “how can we maximize the impact of such investments?”
To answer this question, we have led 2 studies on the status of CSR in Saudi Arabia and its challenges and opportunities, one in 2007 and the other 2009-2010. Both studies findings pointed that in spite of the spread of CSR , there is a need for a more proactive role from the public sector where it helps in setting informed directions and a set of
incentives that create a climate that encourages companies to engage in sustainable practices. That said, we have always called for an independent entity to set a national CSR vision and help create awareness, develop skills in this field, and support and guide companies willing to play a leading role in development. Furthermore, and as a part
time consultant to Al Shura council, since 2009, I have submitted twice a request to Al Shura council to launch an engagement plan joining both public and private sectors representatives in preparation for developing a national CSR strategy that in its turn will lead to new development policies and incentives for the corporate sector. All this gives
us accumulated knowledge now it is time for action. We are at a crossroad.
Today, reflecting on 7 years working with leading Saudi companies, what we need in order to engage the private sector in effective and impactful partnership for sustainability, is to create the culture of sustainability: this means the knowledge, the language to open a constructive debate on sustainability and that will allow companies to come up with relevant solutions built on relevant partnerships. My experience shows that it is not enough to come up with a vision and impose it on the private sector. It is not enough to convince companies to engage in corporate sustainability if their stakeholders do not understand it. It is not right to talk sustainability for our children and future generations if we do not know what our children and future generations want, we have to give them the opportunity to learn more about sustainability and to be ready to take a lead at it.
I have worked with SAGIA on the Saudi Responsible Competitiveness Index (SARCI) that was meant to set criteria for companies to engage in CSR, whereby best practices would be awarded the KKF award for RC. From the 2nd round we have gotten out of it, and that is for 1 reason that there was no engagement of companies to collect feedback and
make revisions on the index. The Index has been running for more than 4 years, does this make companies’ investment impactful? No, but we learnt enough to make the next step. And we have no excuse not to act.
From here, we need a collective effort led by a proactive role from the government and engaging the corporate sector as well as other segments in the society to start a serious and engaging dialogue on sustainability leading to a clear vision, identifying priority needs, setting guidelines per sector, and incentivizing and facilitating a proactive role for companies in sustainability.


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