Starting 30 May 2025, there will be a significant change in how companies in the UAE are expected to engage with, and report on, climate related data.
Federal Decree-Law No. 11 of 2024 is the UAE’s landmark legislation aimed at reducing the effects of climate change and sets out specific and enforceable obligations that go well beyond voluntary sustainability frameworks.
The law was issued in August 2024 and will come into force on May 30, 2025.
While the law applies to all entities in the UAE, mandatory emissions reporting and verification will initially apply to large emitters: defined as entities releasing 500,000 metric tons or more of CO₂e (Carbon Dioxide equivalent) annually.
For most other companies, compliance remains voluntary for now, though the Ministry may widen coverage in future updates.
This is a major shift from communication to compliance, but not entirely unexpected, given UAE’s commitment to Net-Zero.
The Carbon Clock
The consequences of delay will be financial, not just reputational, with fines ranging from AED 50,000 to AED 2,000,000, depending on the severity of the violation.
This means that for businesses that continue to see climate action ONLY as an annual CSR activity, a radical re-adjustment needs to be made.
The work must start now.
From 30 May 2025, high emitters in the UAE will be required to:
- Report Scope 1 and Scope 2 emissions. Scope 3 may apply depending on sector classification.
- Maintain emissions records for a minimum of five years, with data suitable for third party audit.
- Submit verified disclosures through the Ministry of Climate Change and Environment’s digital platform, expected to go live later this year.
A Boardroom Priority
What’s unfolding is not just another ESG reporting cycle. It’s the hardwiring of environmental risk into the regulatory backbone of the UAE economy.
Until now, most companies treated sustainability as a reputational issue; a feel good, glossy section for stakeholders, clients, or annual reports.
But this law reframes it entirely:
- From voluntary reporting to statutory obligation.
- From marketing collateral to legal exposure.
- From comms teams to compliance and operations.
Boards and senior management must now treat GHG reporting the same way they approach VAT, audit, or health and safety: with governance, process, and accountability.
Preparing Now: Three Key Steps
Preparation cannot begin in Q2 next year. The real work, i.e., the systems, data, training etc must begin now. The businesses that treat this as an operational transformation (not just a documentation exercise) will be the ones that avoid penalties.
- Build your emissions baseline
Begin by calculating your Scope 1 & 2 emissions using a recognised methodology like the GHG Protocol. Engage your facilities, fleet, procurement, and finance teams early.
Don’t underestimate the time it takes to validate and clean data.
- Select a fit-for-purpose reporting framework
Choose a framework that suits your sector and aligns with global standards. The GHG Protocol, ISO 14064, or GRI 305 are all good starting points. What matters is that it can withstand review, which is expected to be done by independent third-party auditors.
- Begin exploring mitigation strategies
The future isn’t just about reporting but about reducing. From retrofitting facilities to sourcing renewables or electrifying your fleet, action now will cost less than reactive measures later.
And, importantly, it signals intent to regulators and investors alike.
Think of this like financial auditing: You wouldn’t wait until December to reconcile your books. Climate reporting now demands the same rigour and the same lead time.
This isn’t a future risk. It’s a present compliance requirement.
And for business leaders, it’s a clear message:
Climate readiness is no longer optional.
At MCA Gulf, we support companies in the UAE in meeting new climate reporting obligations through focused, compliance-led support. To explore how we can assist your business in meeting these requirements, schedule a consultation with our team.
We go beyond every day to deliver excellence to our Clients.
Muhammad Wasif Ijlal
Partner – ESG Advisory
Connect with us by email.
Disclaimer: This article is based on current publicly available information as of May 2025, including Federal Decree-Law No. 11 of 2024 and Cabinet Resolution No. 67 of 2024. The regulatory landscape is evolving, and specific implementation details may be subject to change pending further guidance from the Ministry of Climate Change and Environment (MOCCAE).