The UAE has taken a decisive step toward climate leadership with the introduction of Federal Decree-Law No. 11 of 2024, the Reduction of Climate Change Effects. The new UAE climate law took effect on May 30, 2025, marking a defining shift in how environmental responsibility is embedded into national development. It is not just a legal reform; it is a turning point for business, investment, and employment strategy across the country. For companies operating in the UAE, this law introduces both obligations and opportunities. For job seekers and sustainability professionals, it signals a significant increase in demand for ESG-focused roles. As the regulatory environment tightens, businesses are preparing for a new era of compliance, climate disclosure, and green innovation—one that requires a workforce with the right blend of skills, vision, and commitment.
Understanding the new UAE climate law of 2024
What is the Federal Decree-Law No. 11 of 2024?
Federal Decree-Law No. 11 of 2024 represents the UAE’s first legally binding framework to reduce climate change effects and accelerate the country’s journey toward net-zero emissions by 2050. It sets out a national climate accountability structure, requiring businesses across carbon-intensive sectors such as energy, real estate, transport, construction, and manufacturing to actively assess, manage, and report their greenhouse gas emissions. The law is supported by Cabinet Resolution No. 67 of 2024, which sets out compliance obligations for entities identified as large emitters. Organisations producing over 0.5 million metric tons of CO₂ equivalent annually are obligated to register for the National Register for Carbon Credits.
This combined legal framework marks a critical shift in the UAE’s climate governance. By embedding emissions reporting and verification into law, the government is aligning national climate action with international best practices, paving the way for a transparent, regulated, and market-driven decarbonisation process. Full details of the legislation are available via the UAE Legislation.
Implementation timeline and compliance transition
Although Federal Decree-Law No. 11 of 2024 is now in force, the UAE government has introduced a phased compliance framework. This gives organisations—particularly in high-emission sectors—time to realign operations, strengthen ESG protocols, and invest in sustainable systems. Under Article 18, all regulated entities must regularise their status within one year of the law’s effective date. An extension may be granted through ministerial proposal and Cabinet approval, but this grace period is not a reprieve. It is a strategic window for companies to conduct emissions audits, address operational gaps, and embed climate resilience. Those that fail to act risk regulatory penalties and reduced access to sustainability-linked incentives.
Enforcement and penalty framework
Enforcement is led by the Ministry of Climate Change and Environment (MOCCAE), in coordination with other relevant regulatory authorities. Together, these bodies will implement a structured regime of audits, reporting requirements, and data verification protocols to ensure compliance, transparency, and accountability. Organisations identified by MOCCAE and competent authorities are required to measure and report their greenhouse gas emissions regularly. This includes submitting data on current emissions, as well as outlining planned reduction strategies. Entities must retain these records for a minimum of five years, making them available for inspection during routine audits or spot compliance checks. Failure to meet these obligations can result in substantial penalties, with fines ranging from AED 50,000 to AED 2,000,000, depending on the severity and nature of the violation. Additional repercussions may include restrictions on operational permits, exclusion from public procurement, or even public disclosure of non-compliance, which could severely impact brand trust and investor confidence.
How does this fit into the UAE’s sustainability vision?
The Decree-Law is a crucial element of the UAE’s broader sustainability strategy, aligning directly with the national Net Zero by 2050 initiative. It reflects the commitments made at COP28 and reinforces the UAE’s ambition to lead on climate action both regionally and globally. The legislation complements existing frameworks such as the UAE Energy Strategy 2050 and the Green Agenda 2030. Together, these policies represent an integrated approach to climate responsibility, economic resilience, and environmental innovation.
Recent data from the International Renewable Energy Agency (IRENA) and the United Nations Framework Convention on Climate Change (UNFCCC) highlights the importance of national legislation in meeting global climate targets. The UAE’s long-awaited approach positions it ahead of many countries in regulatory readiness and signals long-term confidence to international investors and partners.
What does this mean for businesses in the UAE?
Strategic and regulatory implications
Businesses must now shift from voluntary sustainability efforts to a legally mandated ESG approach. Compliance is no longer optional—it is essential. The law introduces new ESG disclosure requirements that will demand robust internal systems for data collection, emissions monitoring, and climate reporting. Companies will need to implement or upgrade governance frameworks to ensure oversight at the executive level. Legal, operations, HR, and finance teams must collaborate to ensure that sustainability is embedded across every part of the business.. Businesses that integrate sustainability into their operations and culture are also better positioned to secure government tenders, attract investors, and retain top talent.
Opportunities for innovation and leadership
While the law introduces new obligations, it also creates substantial opportunities for forward-thinking companies. Organisations aligning their operations with the new framework may gain access to green financing mechanisms, including sustainability-linked loans, ESG-compliant bonds, and climate-aligned investment incentives. The UAE’s financial hubs, including ADGM and DIFC, have already established platforms to facilitate sustainable finance, giving compliant businesses a head start in capital markets.
In the green energy space, leading firms in the region are already demonstrating how climate policy can fuel innovation. Masdar is accelerating its renewable energy investments both domestically and internationally. ADNOC has unveiled a decarbonisation roadmap that includes significant investment in low-carbon technologies. DEWA is piloting one of the region’s first green hydrogen projects to support the clean energy transition. These examples show that regulatory compliance can be a launchpad for long-term value creation.
The UAE’s Climate Law of 2024 is a strategic inflection point for businesses and the country as a whole. It demands urgent action from companies, not only to meet compliance standards but to rethink how sustainability is embedded across operations. Those who respond proactively will gain more than regulatory alignment—they will position themselves as credible, competitive, and future-ready in a fast-evolving market. For investors, leaders, and talent alike, the message is clear: the UAE is serious about climate action, and the time to act is now.
To learn how the new UAE climate law is reshaping the sustainability and ESG job market, read: The UAE Climate Law ripple effect on ESG recruitment
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