Understanding the UAE’s Climate Change Reduction Law

Governments worldwide are taking increasing responsibility for implementing legislation and policy frameworks to mitigate the impacts of climate change. This underscores the crucial role of nations in managing greenhouse gas (GHG) emissions in line with the Paris Agreement.

These regulatory measures are often extended to industries and sectors, mandating both public and private companies, particularly in critical sectors, to track and reduce their emissions. The recently concluded COP29 in Baku, Azerbaijan, reinforced this global commitment, urging nations and stakeholders to take decisive action in reducing GHG emissions and safeguarding communities from the escalating effects of climate change.

Building on international momentum, the UAE has positioned itself as a regional and global leader in sustainability and climate action. A prime example is the Federal Decree-Law No. (11) of 2024 On the Reduction of Climate Change Effects, which mandates all entities, including those in Freezones, to measure, track, and manage their carbon emissions. This law aligns with the UAE’s Net Zero 2050 strategy, Nationally Determined Contributions (NDCs), and the Paris Agreement, demonstrating the nation’s steadfast commitment to climate action.

By proactively aligning with the law, companies can unlock multiple benefits. Implementing robust emissions tracking and reduction strategies can lead to cost savings through energy efficiency, access to green financing and sustainability-linked investments, and strengthened brand reputation.

Furthermore, organizations that integrate climate considerations into their business models will be better positioned to navigate future regulatory shifts, reduce transition risks, and drive innovation in sustainable practices.