Bring ESG into investment and transaction decisions

Environmental, social and governance factors can affect investment value, transaction risk, financing decisions and long-term business performance.

Potential issues may include environmental liabilities, workforce practices, governance weaknesses, regulatory exposure, supply-chain risks, climate considerations and the credibility of sustainability commitments.

In Saudi Arabia, these considerations are increasingly relevant to investors, large corporates, government and semi-government entities and organisations participating in major transformation and investment programmes linked to Vision 2030.

BDO Saudi Arabia helps investors, companies and public-sector organisations assess relevant ESG factors and incorporate them into transactions, investment decisions, capital allocation and sustainable finance programmes.

ESG due diligence for deals and investments

ESG due diligence helps buyers, sellers and investors identify environmental, social and governance matters that could affect transaction risk, valuation, integration planning or future business performance.

BDO can support clients with:

ESG due diligence for transactions and investments
assessment of environmental, social and governance risks
review of sustainability policies, commitments and performance
climate-related risks and opportunities
governance and compliance assessments
supply-chain and value-chain ESG risk
assessment of ESG-related liabilities and opportunities
review of ESG data, targets and supporting evidence
identification of post-deal ESG improvement priorities

The objective is to provide decision-makers with clearer information about ESG factors that could influence value, risk, transaction terms or post-deal priorities.

Sustainable finance frameworks

Organisations seeking to finance sustainability-related activities need clear eligibility criteria, governance arrangements, performance indicators and monitoring and reporting processes.

BDO Saudi Arabia can assist organisations in assessing potentially eligible projects or expenditures, developing sustainable finance frameworks, defining relevant KPIs and establishing the governance, controls and reporting processes needed to support credible sustainability-related financing.

Depending on the financing objective, this may involve defining how projects are selected and evaluated, how proceeds or performance indicators are monitored and how sustainability commitments are documented and reported to relevant stakeholders.

Sustainable value chains

ESG exposure does not stop at the boundaries of the organisation.

BDO helps clients identify and assess supplier and value-chain ESG risks, incorporate sustainability considerations into procurement and supplier evaluation and strengthen processes for collecting relevant environmental, social and governance information.

This can include defining supplier ESG requirements, establishing assessment criteria and improving access to information needed for Scope 3 emissions, responsible sourcing, human-rights considerations and other material value-chain risks.

Stronger value-chain processes can also help organisations respond more effectively to sustainability expectations from customers, investors, lenders and strategic business partners.

Government and multilateral programmes

Government entities, development institutions and organisations involved in major transformation programmes may need to demonstrate sustainability outcomes alongside financial and operational performance.

BDO Saudi Arabia can bring together ESG, governance, risk, controls and performance capabilities to support the design, implementation and evaluation of sustainability-related programmes.

This can include defining objectives and performance indicators, establishing governance and accountability structures, developing monitoring frameworks and strengthening the information used to assess programme outcomes and stakeholder impact.

For organisations supporting Vision 2030 programmes, this approach can help connect sustainability objectives with measurable implementation, governance and performance management.

Meet BDO Saudi Arabia ESG advisors

Multidisciplinary experience across ESG, climate, risk advisory, internal controls, governance, reporting and assurance.

Abdur Sharjeel

Business Advisory

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Moin Zaidi

Senior Manager, Risk Advisory Services & ESG

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Common ESG questions Saudi businesses face

What is ESG due diligence?

ESG due diligence is the assessment of environmental, social and governance factors that could affect the risk profile, valuation or future performance of a company, asset or investment. It can identify issues such as environmental liabilities, workforce risks, governance weaknesses, climate exposure, supply-chain concerns and gaps in sustainability performance before a transaction or investment decision is made.

When should ESG due diligence be performed?

ESG due diligence may be relevant before acquisitions, investments, divestments, financing transactions and major supplier or strategic-partner decisions. Performing it early can help decision-makers identify material ESG risks and opportunities before valuation, transaction terms, integration plans or capital commitments are finalised.

What is a sustainable finance framework?

A sustainable finance framework defines how an organisation identifies and evaluates eligible sustainable projects, activities or expenditures and establishes the governance, KPIs, monitoring and reporting arrangements that support the financing. It helps provide a consistent basis for demonstrating how sustainability objectives are linked to the use of funds or agreed performance outcomes.

Bring ESG insight into investment and financing decisions

Speak with BDO Saudi Arabia about ESG due diligence, sustainable finance and value-chain sustainability.

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