Sustainability strategy
There is growing recognition in the investor community that ESG issues have a direct correlation with the economic value of an investment. Most investors are now taking meaningful steps to integrate ESG considerations into their investing criteria when evaluating the environmental and social impact of their portfolios.
This became even more relevant in 2021 when ACWA Power shares debuted on the Saudi Exchange’s main market. The Saudi Exchange is a partner exchange which supports the UN Sustainable Stock Exchanges Initiative. It has an ESG reporting framework and encourages sustainable investment, in collaboration with market participants such as issuers and investors.
The Saudi Exchange points out that companies focusing on ESG successfully can unlock new capital, improve profitability and growth, enhance corporate reputation and branding, advance disclosure and risk management, deepen investor relations and engagement, and measure the impacts.
ACWA Power aligns with the Saudi Exchange and recognises that our ESG strategy is integral to our business strategy — we see it as a source of long-term value creation.
Central role in the Kingdom of Saudi Arabia’s energy transition
ACWA Power will continue to lead the Kingdom of Saudi Arabia’s energy transition as a national and global champion.
The Kingdom’s energy transition goals require not only development of over 60 GW of new renewable plants but also conversion of the existing HFO (heavy fuel oil-fired) power and water plants.
ACWA Power and the PIF entered into a strategic agreement for ACWA Power to, in addition to being a shareholder, lead the development of a large part of the KSA’s renewables target, especially the 40+ GW PIF renewable pipeline.
We have 5.6 GW of PV projects currently in operation, under construction or in advanced development in the Kingdom plus a large pipeline of projects under both the PIF renewables programme and the Ministry of Energy programmes (previously known as REPDO programme).
The cornerstone of our ESG approach and strategy is centred on energy transition, low-carbon product leadership, water management, health and safety, and corporate governance. As such, we are responding to a changing societal context, as well as supporting the shift to a low-carbon economy, while capturing growing business opportunities in energy transition. This strategy also enables the investment community to assess our performance against ESG-related indicators, and it demonstrates transparency and the effective management of our priorities. It is shaped by our stakeholders’ priorities and, as such, we engage with a variety of key stakeholders, including employees, off-takers, partners, shareholders and suppliers.
In 2021, while we continued to work towards our ESG goals, we also refined our approach and systems for improved data monitoring, including for our water use indicators. In 2022, ACWA Power’s digital team began building a comprehensive ESG platform which will source all the required ESG data points, and help us better monitor and report our ESG-related KPIs.