Decarbonization for value-creation

At the current global emission rate of 42.2 gigatonnes of CO₂ per year, the world is rapidly approaching critical climate thresholds. The IPCC warns that, at this pace, the remaining carbon budget to limit warming to 1.5°C (400 Gt) will be depleted in under two years if emissions remain unchanged, while the 2°C budget (1,150 Gt) allows for only about two more decades of emissions before being exhausted. In line with this unabated increase, the National Oceanic and Atmospheric Administration (NOAA) reported that atmospheric CO₂ concentrations reached 422.8 ppm in 2024, the highest in modern history; underscoring the urgency of global decarbonization efforts.

Across MENAP, national policies have begun to emerge. Take the UAE: with the passage of Federal Decree-Law No. 11 of 2024 on the Reduction of Climate Change Effects, the country has shifted from voluntary sustainability efforts to mandatory obligations for both public and private entities.

At the corporate level, ESG adoption is accelerating across the region. According to PwC’s 2024 survey, ~80% of Middle East organizations now have a formal ESG strategy — a sharp increase from 64% in 2023. These policy shifts and corporate commitments are anchored in long-term national visions: UAE Net Zero by 2050 and Saudi Arabia’s Net Zero by 2060.

Challenges & opportunities

• Value chain data: Upstream and downstream value chain (Scope 3) emission data is key for decarbonisation efforts. SBTi estimates that supply chain emissions are on average 11.4x higher than direct operation emissions. Engaging with suppliers on common net-zero ambitions, as well as collecting accurate data, poses challenges for enterprises in identifying hotspots that require intervention. Digitally analysing and aggregating data for flagging pain points remains a challenge due to limited supplier transparency and data fragmentation, hindering formation of cost-effective decarbonisation strategy.

A 2025 Argos-BCG survey found that for mid-sized companies, financial constraints (ROI and capex) remain the key barrier to decarbonisation in today’s uncertain political and economic climate

Barriers to decarbonisation (in % of respondents citing the answer within their top 3 of barriers)

• Capex & energy transition: Technologies such as battery storage (for solar & wind), clean hydrogen, and carbon capture, utilization, and storage (CCUS) are at the core of energy transition, all of which require significant capital investment for large scale physical asset development. McKinsey (2023) analysis estimates a requirement of USD 9.2 trillion spending in order to meet net-zero by 2050. Current capital expenditure trajectories will be insufficient to meet this ambitious goal; rising labor costs and surging demand for raw materials are placing additional strain on already stressed supply chains. Green capital expenditures are high and unavoidable; prioritising cost-effective projects is key.

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McKinsey (2023): Capital required to build physical assets to support energy transition

Required spending to meet net-zero targets by 2050, compared to current spending

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• Embedding carbon offset strategy: As per SBTI Corporate Net zero standard, companies can only claim to have reached net zero across the value chain once they have neutralised unabated emissions by utilizing high quality carbon removal offsets. Companies should set targets to reduce at least 90% of absolute emissions by 2050, with the remaining <= 10% of residual emissions neutralised using CO2 removal offsets. In line with this, enterprises need to invest in high-quality carbon removal to help scale new technologies including afforestation, bioenergy with carbon capture and storage (BECCS), enhanced weathering, and direct air capture and storage (DACS). In MENAP, carbon offset projects can be a source of climate finance, especially in vulnerable areas of the region.
• Consumer behaviors: Consumers across MENAP show rising awareness of sustainable choices. According to a BCG survey, awareness of climate change is quite high, with 71% of respondents recognizing its harmful effects. While many express willingness to adopt sustainable lifestyles (80-95% say they are already taking or considering action). Pakistan is now among the world’s fastest-growing solar markets, having imported 13 GW of solar modules in the first half of 2024, with forecasts projecting 22 GW by year-end. This represents a major opportunity: demand for greener products and services already exists. The challenge is in execution. Cost barriers, limited product availability, and infrastructure constraints continue to slow behavior change.

Ahya’s “Google” for net-zero emissions

AhyaOS Analyze:

‍AhyaOS addresses the challenge of fragmented value chain data by consolidating emissions into a clear view of total trends across the reporting year. It provides actionable insights to identify major contributors and hotspots, benchmark emissions across suppliers, enabling enterprises to turn scattered data into focused, cost-effective decarbonization strategies.

AhyaOS Reduce:

SBTi sets a clear mandate for corporate climate action, requiring companies to reduce 50% emissions by 2030 and achieve a minimum 90% reduction by 2050 along with neutralizing any residual emissions. AhyaOS enables organizations to stay on track by visualizing business-as-usual trajectories, comparing them against reduction initiatives, and highlighting gaps to near- and long-term SBTi targets transforming commitments into actionable, science-based decarbonization strategies.

Tawazun:

Tawazun bridges the persistent demand–supply gap in carbon markets by offering enterprises transparent access to over 24M+ tCO2 from 200+ projects, 70% of which are CO2 removal (CDR). Partnering with Verra, Gold Standard, and Puro.earth, every offset is traceable from issuance to retirement, backed by verifiable certificates and a full audit trail that links directly to corporate sustainability goals.

By addressing buyer concerns over quality, transparency, and compliance, while also ensuring sellers benefit from fair terms, faster payment cycles, and real-time FX visibility, Tawazun establishes a trusted, scalable marketplace that transforms offsets into credible climate finance and corporate value creation.

Ahya’s ecosystem supports transparency, accuracy, and economic growth by promoting decarbonisation efforts at lowest possible costs through step reduction and streamlined processing, enabling faster decision making and minimizing avoidable costs.