Impact Of ESG Standards On The Operations Of Higher Education Institutions In The UAE Sample

Introduction Of Impact Of Esg Standards On The Operations Of Higher Education Institutions In The Uae

Background

The research study is about the discussion on the “impact of ESG standards primarily on operations of higher education institutions in UAE”. According to Li et al. (2021), previously it is found that principle of ESG significantly developed mainly for 17 years in a financial institution, construction industry for maintaining coordination between society, governance as well as environment. All countries around the world significantly continue towards promoting the coordinated establishment of “environment, society as well as governance” concerning ESG principles. In addition to this, previous study puts more emphasis on construction industry and financial institutions regarding the ESG principle instead of implementing it in educational sector of the UAE. This is the main literature gap, which is identified as ultimate purpose for adopting this research study. ESG mainly stands for “Environmental, Social as well as Governance” and these practices are quite imperative to every stakeholder of financial institutions.

Therefore, placing ESG is one of the sole objectives of this research paper as placing this in education investment can effectively produce a highly definitive approach mainly for measuring social progress. Moreover, it provides in-depth for those who are mainly looking towards evaluating corporate ESG efforts. In this research study, ESG reporting consists of an analysis of the education sector in UAE concerning three pillars of “environment, governance as well as social”. Moreover, there remain multiple frameworks, which significantly develop starting points for education sector in UAE. This comparative study examines UAE’s ESG policies primarily for education sector (binti Adnan et al. 2023). It is reported that in recent periods, “environment, social as well as governance” has been voluntary mainly for education sector, and companies in UAE. this research study is going to show that education system in UAE is mainly a relative one. On other hand, between 1960s as well as 1970’s a “school building program” significantly expanded overall education system in UAE.

It is reported that in UAE education sector is facing major issues such as employment issues, lower levels of wages, safety issues and many more. To mitigate such issues educational sector in UAE is required to adopt the ESG principle, which is the main highlighting part of this research study. To mitigate educational issues, this research study discusses ways higher colleges of UAE adopt technology and effectively become one of the first universities “to be granted a five-star ESG rating”. The discussion of this research study is based on certain challenges primarily in educational system of UAE. issues concerning teacher competency, quality of education as well as Teacher Turnover rate. “Higher Colleges Technology (HCT)”, has significantly become very first university that has effectively achieved a “5-star environment, sustainability, governance (ESG) rating.

Aim

This study aims to analyse the impact of ESG standards on the operations of higher education institutions in the UAE

Objectives

• To evaluate the significance of the adoption of ESG standards

• To analyse the adverse effects of not adopting ESG standards

• To examine the effect of the adoption of ESG on operations of educational institutions

Research Questions

1. What is the significance of adoption of ESG standards?

2. What are adverse effects of not adopting ESG standards?

3. What is the effect of adoption of ESG on operations of educational institutions?

Literature Review

Significance of adoption of ESG standards

ESG reporting framework along with its measurement standard primarily related towards assurance and level of support for disclosing social and environmental metrics mainly in ESG reports. As opined by Cort and Esty (2020), Moreover, a firm’s decisions towards obtaining ESG assurance are significantly driven by its adoption of an “ESG reporting framework” such as GRI. Most importantly ESG principle significantly helps in improving aggregate financial performance of industrial and educational sectors. For instance, small efforts towards sustainability such as recycling, going paperless, and using renewable sources of energy can effectively improve bottom line of business and ROI. ESG report significantly delivers way primarily for organizations and education sector towards making proper disclosure along with assisting in ensuring regulatory compliance. Therefore, ESG programs significantly assist businesses towards attracting investors, improving financial performance making sustainability and gaining a competitive advantage. As opined by Zumente and Bistrova (2021), most importantly, ESG significantly adds value towards “long-term shareholder value” regarding creation along with discovering whether businesses of different sectors are highly aware of ESG-conscious.

Analyse the adverse effects of not adopting ESG standards

It is reported that in present years, interest in economic, and social sustainability, as well as environmental, has significantly increased. According to Baratta et al. (2023), companies and other sectors are adopting effective behaviours, which are aimed towards adopting “Sustainable Development Goals”, which are significantly presented in the 2030 Agenda. UAE community backed by European community is effectively pushing towards complying with adopting ESG practices via new regulations. For instance, link primarily between industrial operations along with carbon emissions cannot get neglected mainly within “factory of future”. It is reported that competent efforts are required to be adopted by industrial sector and education sector in UAE and by oyster countries towards standardizing regarding KPIs and variables backed with adoption of “ESG-centric strategies”.

The issue with ESG concerning investment approach is mainly a lack of standardized form of criteria that invests a quite sustainable one. For instance, the ESG approach “yields guilt-free returns” and it is done by exclusions of defence investment along with excluding fossil fuel. Lots of critics mainly emphasize departure of ESG primarily from standard form of investment goal regarding prioritising financial returns along with blaming it mainly for driving towards energy prices via “disinvestment in fossil fuels” (Plantinga and Scholtens, 2021). It is reported that if an organization fails towards adopting ESG principles then such organizations and sectors might pave towards ample risk. Therefore, risk consists of a lack of interest level mainly from future investors, significantly losing the loyalty of customers who have developed more environmental and social issues. This potentially ignores requirement towards complying with present environmental regulations. Despite that “sustainability engagement” might implicitly cause some “agency cost”, which is perceived as an unfavourable way of spending, which goes against “stockholder’s desires” (Chams et al. 2021). Ultimately risks concerning ESG are social, and environmental along with governance factors that have created an impact primarily on financial success as well as management of an organization. Failing with adopting ESG standards, there might be certain consequences, which lead sectors towards expensive fines along with depletion in organization’s financial reserves. For instance, this serves as a significant guideline for way different sectors must treat the environment.

Organizations are highly determined towards managing their social risk while cultivating ESG-related risk strategies. It is for ensuring that all suppliers of the different sectors remain up-to-date concerning ESG standards. As opined by Cohen (2023), social risks are quite pivotal regarding the mitigation of another form of ESG risk. Organizations and other sector seeking towards improving their governance component regarding ESG management strategy should remain highly aware of new environmental regulations along with motivation of boards towards managing and monitoring ESG risk.

Effect of the Adoption of ESG on Operations of educational institutions

Placing ESG primarily in education can effectively produce a higher definitive approach concerning measurement of social progress. It is reported that in UAE education sector is facing major issues such as employment issues, lower levels of wages, safety issues and many more. To mitigate such issues educational sector in UAE is required to adopt the ESG principle, which is the main highlighting part of this research study. It is reported that educational sector in UAE significantly implements sustainability practices. As opined by Schmuck (2021), they also create awareness programs regarding sustainability practices mainly among students, staff and faculty. Furthermore, in European Union, they are presently in a mode of introducing "Standards and Guidelines for Quality Assurance in European Higher Education Area (ESG) standard". It is due to "accreditation requirements" along with effective management systems concerning higher education that are becoming highly essential. For instance, this will lead towards quality improvement both in the European and UAE educational sectors. Furthermore, this research paper is going to discuss HCT’s commitment towards environmental sustainability, which is mainly demonstrated by its competent sustainable policies, climate action plan as well as carbon-neutral plan backed with outreach and education programs”.

Research Process

This research proposal will significantly make utilisation of primary data collection approach. Additionally, a survey will be conducted where questions will be asked to 25 respondents of the age group between 25-40 years. Therefore, questions that will be conducted in the survey are going to be quite relevant to the topic of this research proposal (Hennink and Kaiser, 2022). On another hand, a systematic sampling method will also be utilised for conducting this research proposal. Moreover, practical form of recommendations are going to be offered on the utilisation of systematic sampling data analysis, that is for “achieving theoretical integration” (Ligita et al. 2020). Therefore, for identifying issues and another aspect of this research proposal, this sampling will consist of questionnaires, surveys, and interviews of at least 25 respondents of different age groups.

Research plan

Table 1: Time line

(Source: Self-created)

Figure 1: Gantt Chart for Proposal

(Source: Self-created)

The research plan of this research proposal will be conducted with the help of a Timeline. This will consist of several stages such as selection of research methodology, proposal formation backed with proposal submission, literature review and primary data collection approach. At last, results will be identified followed by submission. This research study will start on 12th June 2023 and will finish on 14th July 2023.

References

Baratta, A., Cimino, A., Longo, F., Solina, V. and Verteramo, S., 2023. The Impact of ESG Practices in Industry with a Focus on Carbon Emissions: Insights and Future Perspectives. Sustainability, 15(8), p.6685.

binti Adnan, I.H., binti Misman, S.N., binti Mohd Yusof, S.S., binti Hassan, R. and binti Che Basir, N.A., 2023. ESG Policies for Financial Institutions: Comparative Studies Between Malaysia, United Arab Emirates and United Kingdom. In Digitalisation: Opportunities and Challenges for Business: Volume 2 (pp. 375-388). Cham: Springer International Publishing.

Chams, N., García-Blandón, J. and Hassan, K., 2021. Role reversal! financial performance as an antecedent of ESG: The moderating effect of total quality management. Sustainability, 13(13), p.7026.

Cohen, G., 2023. ESG risks and corporate survival. Environment Systems and Decisions, 43(1), pp.16-21.

Cort, T. and Esty, D., 2020. ESG standards: Looming challenges and pathways forward. Organization & Environment, 33(4), pp.491-510.

Hennink, M. and Kaiser, B.N., 2022. Sample sizes for saturation in qualitative research: A systematic review of empirical tests. Social science & medicine, 292, p.114523.

Li, T.T., Wang, K., Sueyoshi, T. and Wang, D.D., 2021. ESG: Research progress and future prospects. Sustainability, 13(21), p.11663.

Ligita, T., Harvey, N., Wicking, K., Nurjannah, I. and Francis, K., 2020. A practical example of using theoretical sampling throughout a grounded theory study: a methodological paper. Qualitative Research Journal, 20(1), pp.116-126.

Plantinga, A. and Scholtens, B., 2021. The financial impact of fossil fuel divestment. Climate Policy, 21(1), pp.107-119.

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Schmuck, R., 2021. Comparison of the ESG Guidelines Used in the European Higher Education Sector with the Principles of the ISO 9001: 2015 Quality Management Standard. Quality-access to success, 22(181).

Zumente, I. and Bistrova, J., 2021. ESG importance for long-term shareholder value creation: Literature vs. practice. Journal of Open Innovation: Technology, Market, and Complexity, 7(2), p.127.