< PreviousSUS TAINABILIT Y 40 Vol. 25/03, March 2024 The power of transparency and clear commitments in securing a more sustainable future Research has consistently shown that today's consumers prefer companies that genuinely commit to sustainable actions I n today’s world, there’s an increased sense of urgency in both the public and private sectors, with a pressing need to commit to sustaina- ble practices. It’s becoming a corner- stone of business operations, driven in part by the fact that consumers, and investors, increasingly favour brands that prioritise sustainability. But we need to set the record straight: Real sustainability isn’t just a buzzword for the annual report. It must be at the core of any business and impactful. Setting clear objectives is paramount; it has to be measurable, monitored, and integrated into the fabric of the business. The importance of reporting and transparency cannot be overstated; we owe it to the public to authentically uphold our claims, foster- ing trust, and actively participating in the construction of a foundation built on transparency and accountability. The BY FLORENCE BULTE, CHIEF SUSTAINABILITY OFFICER AT CHALHOUB GROUP AND SECRETARY OF THE GLOBAL COMPACT LOCAL NETWORK UAE (GCLN UAE) SUS TAINABILIT Y Middle Eastern consumers are three times more likely than their global counterparts to back a brand with a solid environmental recordarabianbusiness.com 41 SUS TA INABILIT Y Real sustainability isn’t just a buzzword for the annual report. It must be at the core of any business and must be impactful public is tired of overclaim, and increas- ingly capable of knowing greenwashing when they see it. Research has consistently shown that today’s consumers prefer compa- nies that genuinely commit to sustain- able actions . A recent Global Consumer Insights Survey by PWC is a wakeup call. Over half of the respondents from the Middle East stated that a company’s environmen- tal, social, and governance (ESG) eff orts infl uence their brand loyalties. Indeed, Middle Eastern consumers are three times more likely than their global counterparts to back a brand with a solid environmental record. And it’s not only consumer prefer- ences. Stakeholders, too, are seeking more from businesses than mere profi t margins. They’re watching for genuine initiatives, transparency, and actiona- ble measures concerning climate and sustainability. A separate PWC report disclosed that 64 percent of Middle East companies surveyed have now established a formal ESG strategy. At Chalhoub Group, we’re proud of being an early adopter, to sustainable practices and we want to lead by exam- ple. Our most recent 2022 Sustainabil- ity Report was independently assured by third party verifier and our carbon reduction targets were validated by the Science Based Target Initiative (SBTi), ensuring that we not only demonstrate but quantify our commitment. Our stated aim is to reach carbon net-zero by 2040 and we have made our green- house gas (GHG) emissions public. This will now become standard practice for the group, echoing our dedication to transparency and accountability. In alignment with the Intergov- ernmental Panel on Climate Change (IPCC) standards, our goals are clear. We’re not just setting targets; we’re laying out a roadmap to ensure we remain on the right trajectory. Our three-pillar approach – People, Planet, and Partners – outlines our commitments. From aiming to bring more women into leadership roles to cutting our GHG emissions by signif- icant margins by 2032, we're in it for the long term. our own ESG credentials are closely monitored by the world leading luxury brands who chose to work with us. So, what’s the endgame here? When b usinesses outline clear sustainability goals, continually eval- uate their strategies, and set a clear roadmap and objectives, it leads to a ripple eff ect. A network of companies, all driven by a shared goal, can be a potent force for change. This belief in collaboration is why I’ve taken up the mantle as Secretary of the Global Compact Local Network UAE (GCLN UAE). My vision? To steer companies towards building iron- clad commitments for a brighter, more sustainable future. GCLN plays a pivotal role in supporting the private sector on their sustainability journey, off ering invaluable access to knowledge through accelerator programmes and dynamic networking platforms. Every challenge is an opportunity, and with the conclusion of COP28 in Dubai it is equally important to use our newly formed connections and conver- sations as a booster for future develop- ment and improvement to deliver on our targets. This is the beginning of an even more impactful journey, leveraging collaboration and sharing knowledge to achieve wider sustainability goals that I truly believe will benefi t people, planet, and partners, all working together towards one common goal. A network of companies, all driven by a shared goal, can be a potent force for change, says Bulte ESG targets are becoming deciding factors in procurement processes But we can’t do this alone. Partner- ing with organisations that share our vision is vital. Today, ESG targets are becoming deciding factors in procure- ment processes. Organisations with robust sustainability strategies are our preferred business partners, and indeed FINANCE 42 Vol. 25/03, March 2024 The future of payments is global, open and interoperable With sweeping changes in consumer behaviour and organisational ambitions, the payment trends for 2024 will enhance the scope and size of opportunities for all players in the nancial ecosystem The year 2024 looks promising for the payments industry in the GCC, riding on the bene- ts of digital transformation, a focus on increasing financial inclusion, impact of sustainable finance, and surge of ecommerce. As the industry continues to evolve, open infrastruc- ture, interoperability, and global digi- tal economy will be among the forces shaping payment trends in 2024. 1. Creators and SMBs embrace global growth From the creator and sharing econo- mies to ecommerce and traditional brick-and-mortar businesses, this is the year small and micro businesses (SMBs) go global. A shift in mindset, from going beyond the local neigh- bourhood into new geographies, reflects the aspiration for upward growth among businesses of all sizes. Increased digitisation has also trans- formed opportunities, both quickening and protecting payments, and enabling growth beyond national borders. For SMBs, this means reaching new audiences, easily accepting secure payments, tracking and moni- toring spending, increasing security and safety, improving e ciencies, and continuing to grow. Payment innovations grant access to earnings in real-time, making it convenient to receive consumer and business-to-business payments while solutions like virtual cards are enabling SMBs with cashflow, purchasing power and expense management capabilities needed to thrive in today’s digital- rst world. 2. Seamless global money movement through Interoperability With payments players prioritising interoperability, we will soon see global money movement across networks and payment methods, with seamless movements breaking down barriers and bringing myriad bene ts to end-users. In 2024, we will continue to see collaboration across the payments ecosystem – amongst banks, nancial institutions (FIs), merchants, technol- BY DR SAEEDA JAFFAR, SVP AND GCM, VISA, GCC FINANCE Payment innovations grant access to earnings in real-time, making it convenient to receive consumer and business paymentsarabianbusiness.com 43 FINANCE ogy providers/enablers and issuers – bringing us greater global nancial inclusion, accessibility, cross-system compatibility, and interoperability. We expect to see more technologies developed to help both consumers and businesses navigate the intrica- cies and complexities of cross-border money movement. 3. Generative AI – A new tool to combat fraud By analysing and gleaning insights from vast amounts of data, generative arti cial intelligence (AI) plays a lead- ing role in addressing fraud. When integrated into the buyer journey, the data-led approach lowers checkout friction, enhances real-time deci- sion-making, and provides a better and safer customer experience. In the UAE, “overcon dence” has often been cited as key to increased vulnerability of consumers to fraud. Despite claims of being alert to online and phone scams, the fact is that indi- viduals tend to overlook warning signs of online criminal activity. Turning to generative AI can not only detect fraud but also educate consumers about potential threats and help distinguish between fraud- ulent and genuine transactions. To harness the full power of data and protect businesses and consumers, insights gained must be shared with businesses and individuals to identify phishing scams, spot errors, and moni- tor the evolving threat landscape. 4. Conscious travel The momentum for travel that picked up well in 2023, is set to rise further in 2024. As travellers add exibility in planning, accommodation, safe, digi- tal, contactless payment preferences and more, many also actively seek out sustainable travel choices. Climate banking platforms launched by Mashreq in the UAE and Qatar Islamic Bank in Qatar in partnership with Visa and Ecolytiq, for example, will address this growing need and enable users to calculate the carbon footprint of their purchases and receive tips on o set- ting carbon impact. ment payments or (BNPL) solutions for larger purchases, especially in the UAE where 20 percent of consumer credit card purchase volume is now converted to instalments. 6. Sustainable commerce As sustainable practices and greater environmental consciousness become mainstream, consumers are also look- ing for sustainable nancial options and are keen to understand their envi- ronmental impact in spending. Stud- ies in the UAE show that 64 percent of consumers tend to choose banks with strong green credentials while more than half of the surveyed consumers (51 percent), expect their banks to guide them in making sustainable nancial choices. The leaning towards sustainability was higher among young consumers. Moving forward, the implementa- tion of regulatory policies and frame- works will foster an ecosystem condu- cive to sustainable practices. Medium-sized businesses equipped with technical knowledge are expected to adopt sustainability standards, propelling the adoption of environmentally conscious nancial decisions. Financial institutions will respond by introducing solutions that cater to consumers’ growing demand for sustainable commerce. Change can be good With sweeping changes in consumer behaviour and organisational ambi- tions, the payment trends for 2024 will enhance the scope and size of oppor- tunities for all players in the nancial ecosystem. Despite the many changes, the one constant that remains intact is the continued appetite for exibil- ity, safety and convenience, contrib- uting to a stronger digital payments infrastructure that meets consumers’ expectations for frictionless and secure payments. With card-based payments on the rise, we anticipate the emergence of new products tailored for everyday spending and peer-to-peer transactions, further diminishing the reliance on cash in the payments sector. 130M The number of Visa merchant locations in more than 200 countries and territories around the world Visa anticipates the emergence of new products tailored for everyday spending, says Jaffar 5. More tailored solutions for consumers Consumers increasingly expect an experience that is tailored to them, from merchants and banks, as well as financial institutions that service them. The technological innovation to address this demand requires ample resources and can be a complex a air for several organisations. This is where the next trend – collaboration – comes in. Partner-based solutions are a cornerstone of development for many businesses, to lend exibility and agil- ity in digital payments, and build trust with the customer. This will impact businesses by introducing the next level of accessibility and adoption, especially to cater to segments such as GenZ and millennials. Tailored solutions are also being sought to meet the growing demand for instalment payments to enhance the shopping experience. Under this solution, all the players involved in payments – the issuing bank, payment processor, merchant, and payment facilitator are integrated into a single, interoperable ecosystem. Consumers are therefore increasingly using instal-SUS TAINABILIT Y 44 Vol. 25/03, March 2024 Building cyber resilience will be necessary to realise Saudi Arabia’s Vision 2030 The enablement of human capital lies at the heart of the efforts towards cyber resilience; it is vital that we empower individuals with the knowledge, tools and support they need to stay ahead of the curve Amidst the ever-evolving land- scape of digital threats, the imperative to safeguard cyber- space has become paramount for nations. With cyberattacks growing increasingly sophisticated, their targets expanding to encompass sensitive information and critical infrastructures, the need for enhanced cyber resilience has risen to prominence. This height- ened focus was underscored at the 2023 World Economic For um in Davos, where cyber resilience emerged as a top priority for organisations. Notably, the Global Risks Percep- tion Survey respondents have identi- fi ed cyberattacks on critical infrastruc- ture as one of the top five risks for 2023. Both regionally and globally, Saudi Arabia has been at the forefront when it comes to building cyber resil- ience. In fact, the countr y ranked second in the Global Cybersecurity Index in the World Competitiveness Yearbook for 2023. BY FAHAD AL SUHAIMI, COUNTRY MANAGER FOR SAUDI ARABIA AT HELP AG TECHNOL OGY The Saudi Federation for Cybersecurity, Programming, and Drones has set an ambitious goal to produce a programmer among every 100 Saudis by 2030arabianbusiness.com 45 TECHNOL OGY Saudi Arbia is well- positioned to reap the benefi ts of digital transformation while bolstering cyber resilience to secure critical systems and infrastructures What is cyber resilience? We use this term to refer to the ability to anticipate, withstand, and rapidly recover from cyber incidents, ensuring the continuity of operations and safe- guarding valuable assets. The key components that form the foundation of cyber resilience are robust risk assessment, continuous monitoring, and threat intelligence. Moreover, education and awareness play a vital role in building a national culture of cyber resilience. Saudi government leads cybersecurity drive Recognising that cyber resilience is crucial to achieving the ambitious goals, Saudi Arabia has deployed a National Cyber secur ity Strategy aligned with Vision 2030. Carefully crafted to realise the concept of a “safe and reliable Saudi cyberspace that enables growth and prosperity,” the strategy successfully balances the elements of security, trust, and growth. This secure cyber space will be the foundation on which the kingdom will realise its various ambitions across fields ranging from government to education to space missions. Saudi Arabia has made a multi-faceted push towards this goal, enacting legislation, creating bodies and implementing educational and training initiatives to build the required infrastructure and cultivate local cybersecurity talents. For example, the kingdom is deci- sively moving toward a progressive data protection regime, having originally introduced the Personal Data Protection Law in 2021 in line with global best practices. More recently, KSA has announced amendments to the law that introduce more nuance to the stipula- tions in line with the country’s eff orts to becoming a business-friendly economy. Saudi Arabia has also formed a number of national organisations in the interest of building cyber resilience across diff erent areas. One such organ- isation – the new institute for the Global Cybersecurity Forum in Riyadh – is set to encourage international cooperation, contribute to building local capabilities, edge, tools and support they need to stay ahead of the curve. This requires a continued investment in training and development, as well as a focus on culti- vating a positive and proactive national cybersecurity culture. The Saudi National Cybersecurity Authority has made this a priority, while broader efforts pertaining to Saudisation and the empowerment of women within the cybersecurity fi eld are also contributing to filling vital cybersecurity roles. The role of service providers Along the kingdom’s journey to secure its cyber space, we have observed a trend among Saudi organisations who are choosing to partner with skilled experts to build cyber resilience. After all, as the threat landscape continues to evolve at exponential rates, it is extremely diffi cult for organisations to maintain cyber resilience by depend- ing only on in-house security teams. This, coupled with the global short- age of skilled resources in cybersecu- rity, has led to the need for partnering with expert Managed Security Service Providers (MSSPs), to ensure 24/7 monitoring and incident response. Moreover, specifi c organisations within Saudi Arabia, notably in the financial sector, have fortified their defences with dedicated security oper- ations centres. These entities also choose to collaborate with Managed Security Service Providers (MSSPs) to augment their security posture, creat- ing a multi-tiered shield against poten- tial threats that might elude their inter- nal security apparatus. Looking ahead Saudi Arabia has fi rmly established its global leadership when it comes to cyber resilience. As the kingdom progresses towards the future, security and success will be inextricable from one another, and the empowerment of human capital will be crucial to bring- ing these ideals to life. The kingdom is well-positioned to reap the benefi ts of digital transformation while bolstering cyber resilience to secure critical systems and infrastructures. Saudi Arabia has firmly established its global leadership when it comes to cyber resilience, Al Suhaimi says promote research and development, and help to establish policies that boost cyber resilience. In response to the global cyberse- curity workforce shortage of over 2.5 million jobs, the kingdom is gearing up. A PwC survey indicates that 58 percent of respondents in Saudi Arabia believe there’s a shortage of specialised skills. Recognising the urgency, the Saudi Federation for Cybersecurity, Program- ming, and Drones has set an ambitious goal: To have a programmer among every 100 Saudis by 2030. The enablement of human capital lies at the heart of the eff orts towards cyber resilience; it is vital that we empower individuals with the knowl-46 Vol. 25/03, March 2024 TECHNOL OGY Biometrics have changed digital security but privacy, ethical challenges need to be addressed The use of biometric authentication and identification offers unrivalled convenience and security in a modern connected city but the technology needs to be built responsibly T he use of biometrics as a tool for identification and security purposes is not new. Since the late 19th century fingerprinting has been a standard police practice, with voice, iris and facial recognition developed in the latter half of the 20th century. What is new is its rapid inclusion in every aspect of our lives. Once the reserve of the police and security forces, biometric authentication has fl ooded into the mainstream; with facial recog- nition on smartphones, fingerprint access to online apps, and biometric payment cards becoming the norm. The required technology, using advanced algorithms, machine learn- ing, and artificial intelligence, has become cheaper and widely available. The key to social acceptance of biometrics lies in mobile phones. Apple’s introduction of Siri paved the BY EMMANUEL DE ROQUEFEUIL, VICE-PRESIDENT, MIDDLE EAST OF THALES TECHNOL OGY Most new passports contain biometric identifiers, which allow their use at smart gates across the Middle East and around the worldarabianbusiness.com 47 TECHNOL OGY There is potential for misuse of biometric applications, including invasion of privacy, disclosure of sensitive information and restriction of individual freedoms way for voice recognition and digital personal assistants on smartphones. Shortly afterwards fingerprint and facial recognition became common- place across digital phone platforms. In the modern connected countries of the Middle East, the acceptance and use of biometrics has boomed, acceler- ated by the pandemic as it offers contactless convenience and security. Biometric solutions for identifi ca- tion have been used in Middle Eastern countries for decades, such as national eID cards and modules for citizen and resident digital identity and security. In Qatar, for instance, dual interface cards combine a built-in biometrics feature and an Identity & Authentica- tion Services software applet, which can perform both contact and contact- less communication to verify and authenticate the card holder either in person or online. This technology can be used to securely access any online public ser vices from your laptop, mobile phone, with over 50 public service providers using the platform to deliver over 1,400 Hukoomi services, out of which 650+ are transactional based and use electronic identifi cation, authenti- cation and eSignature technologies. The technology is leveraged daily in high-volume areas such as healthcare provision, hospitality and financial services to improve processes and secu- rity, However, travel is perhaps the sector that has most benefi tted, both in speed and security. Most new passports contain biometric identifi ers, which allow their use at smart gates. Contactless identifi - cation and authentication systems use facial biometrics and digital IDs to help streamline, and ultimately improve, passenger experience at other areas of the airport – removing the need for passen- gers to show a ticket or ID at every check- point, saving up to 30 percent in board- ing times, and cutting the security risks of forged documentation. Future tech raises questions The next stage will be the rise of silent authentication, also known as continu- ous authentication, which will mean that people can be identifi ed and veri- authenticate you silently, thanks to a powerful and continuous machine learning analysing data. The continuous nature of this authentication is what has caused ethical objections to be raised, and the industry has already seen legislation imple- mented in Europe, restricting its use. To be clear, there are two uses of biometric data, authentication and identifi cation. Authentication is about providing a secure way for an individual to prove their identity, and there are few concerns about its use. Biometric identifi cation is about identifying a person in a crowd, for example, without any action on their part, and in some cases, without their consent. This has been extensively used by public authorities for criminal justice, border management and terrorism prevention. There is potential for misuse of these applications, including invasion of privacy, disclosure of sensitive infor- mation and restriction of individual freedoms. And while off ering increased security, as these systems are far more diffi cult to hack, biometric data, such as fi ngerprints or iris scans, are also almost impossible for the user to change if they are compromised, unlike a password. But tighter regula- tion and corporate responsibility can provide adequate safeguards to limit the risks of misuse. Biometric technol- ogy development companies can be held to account, and should be able to openly explain the rules by which the technology is deployed and designed and explain and justify the its use and the results, in such a way that users can understand the data used to arrive at a conclusion. The potential and growing benefi ts for increased secur ity, improved process and accessibility for those using air por ts, hospitals and financial services, as well as for the businesses that operate them, significantly outweigh these concerns. Like other transformational technology before it, biometric technology off ers great busi- ness and public potential, and I believe that its integration into our lives off ers us all a more secure future. $104.22BN The expected value of the worldwide biometrics market by 2029, according to a report by Mordor Intelligence Biometric technology offers great business and public potential, de Roquefeuil believes fi ed based on passive behavioural biom- etrics. User behaviour analytics solu- tions include geo-location tools that use machine learning to build a picture from the stores they regularly visit, as well as how a person walks or how they hold and swipe their device. This typi- cally relies on an app running on your smartphone while dealing with your daily activities: It will identify and SUS TAINABILIT Y 48 Vol. 25/03, March 2024 How AI, big data and cloud will drive the future of fi nance From organisational restructures, operational efficiencies, informed decision making and product planning, the advantages of AI, data and cloud technology are numerous T he world of fi nance is undergo- ing signifi cant transformation as innovation continues to revolutionise the industry. During 2024, we expect AI, Big Data and Cloud to play a signifi cant role in driv- ing the future of fi nance. The beginning of digitisation and the enfolding of a concept of digital economies began in the 1990s, picking up speed during the dotcom boom. The accelerated momentum was followed by a lull around 2001. At that stage, more established financial companies were early adopters – developing inter net banking and mobile banking services. Today, the principles remain the same – digital economies are created using technology to facilitate the BY ARIF AMIRI, CEO OF DIFC AUTHORITY TECHNOL OGY Dubai International Financial Centre (DIFC) is the region’s most comprehensive ecosystem for fintech and innovation and is now currently home to over 800 companies ranging from startups to global unicornsarabianbusiness.com 49 TECHNOL OGY exchange of information, goods and services, transactions, all of which needs to be enabled by finance and payment solutions. So, how are digital economies created? They are enabled by govern- ments, central banks, regulators and international financial centres that create frameworks, laws and regula- tions to stimulate, and in some cases, incentivise fi nancial innovation in digi- tal economies. Stimulation begins when fi nancial organisations, fi ntechs, start- ups and other companies are provi- sioned with a safe environment to test new ideas and solutions. This is where the concept of sandboxes, quite preva- lent in the Middle East and North Africa region, come of use. Another catalyst for digital transi- tion is changing client and customer behaviours. We have seen digital tech- nology gaining further impetus during the pandemic. Closer to home, Dubai – and the wider UAE – have been among the fi rst in the developing world to embrace a digital strategy that fosters a culture of innovation. Furthermore, a culture of innova- tion has been the foundation propelling the Dubai International Financial Centre (DIFC) to build the region’s most comprehensive ecosystem for fintech and innovation and is now currently home to over 800 companies ranging from startups to global unicorns. At DIFC, innovation is a corner- stone to progress. Having consulted with over 4,900 companies that use the centre as a catalyst for growth, the consensus remains over three trends that will drive the future of fi nance: Artifi cial Intelligence (AI), data, and cloud. Implementing AI In the finance industry, AI is more than an idea. Today, AI is extensively used to tackle financial crime. The Mastercard Global Cyber Forward programme that was launched with DIFC improves readiness to deal with c yber threats. Elements of the programme consider the potential of AI and builds on the introduction of a Threat Intelligence platform launched with the DFSA in 2020. ance. Given DIFC’s vision to drive the future of finance, the centre recognised this early on and enacted the fi rst data privacy regulations in the Middle East, Africa and South Asia region that consider AI and machine lear ning. As a financial centre of 20 years’ standing, DIFC’s data pr ivac y laws are the most advanced in the region and refl ect the highest international standards. In addition, the centre has strong IP laws that allows the protection of ideas when firms want to develop innovative solutions. Looking to the future, the ethical processing of data must consider AI and machine learning. DIFC is now creating use cases for testing through consulta- tion, inspection, and supervision. Cloud migration gathers momentum As an application that facilitates access of remote storage and data assets, cloud technology should have been a catching trend for the finance and banking sector. However, cloud adoption in the fi nancial industry is still relatively slow, purely because of the complexities involved. Mostly, early embracers of cloud technology have been new banks with a digital fi rst approach or legacy banks that are undergoing a signifi cant digital transformation. Migrating to a cloud platform requires education and cross-team inte- gration to bring together product devel- opment teams, marketing, risk, compli- ance and IT. While many financial services players are still opting for data centres for data storage, several compa- nies have chosen cloud technologies for their data storage needs. From organisational restructures, operational effi ciencies, informed deci- sion making and product planning, the advantages of AI, data and cloud tech- nology are numerous. Finance leaders and fi nancial services providers have much to learn before they embark on this journey to drive strategic opportu- nities using innovation. What is clear is that innovation ultimately drives progress, and subsequently, the future of fi nance. 36,000+ The number of professionals who work in the DIFC business ecosystem DIFC’s data privacy laws are the most advanced in the region and reflect the highest international standards, Amiri says AI is a great enabler when stream- lining business processes to make them more agile. For example, DIFC’s Dubai AI and Web3 Campus recently launched an Artificial Intelligence Transformation Programme, a highly customisable corporate accelerator, to future-proof businesses in the region by enhancing their AI capabilities. The initiative will further elevate Dubai’s abilities to compete at a global scale to harness talent, innovation, and grow its economy. Data is king The full extent of digitisation of fi nancial services refl ects the strength and quality of data possessed by an organisation to assess risk, for propensity modelling for product sales, pricing and creating marketing campaigns, building relation- ships and to aid decision making. However, while data needs to be extensive, the process of using this data has important considerations that include data privacy and govern-Next >