As economies around the world become increasingly digital and interconnected, sustainable business practices are more influenced by how organizations manage information, technology, risk, capital and stakeholder relationships.
As global investors continue to prioritize markets that combine growth with resilience, responsible business practices will remain central to sustainable value creation. In response, many companies are taking concrete steps to improve corporate sustainability.
As economies become increasingly digital and interconnected, sustainable business practices are influenced by how organizations manage information, technology, risk, capital and stakeholder relationships. Data protection, cybersecurity, ethical decision-making and effective governance are becoming essential elements of long-term resilience.
This evolution reflects a broader shift in how markets assess sustainability. Ratings agencies increasingly incorporate environmental, social and governance (ESG) factors into credit assessments, recognizing their relevance to risk management and long-term value creation.
The evolution of sustainability is therefore not only about what companies produce, increasingly it’s also about how they govern, manage risk and build resilience.
In 2022, stc Group published its fourth sustainability report, which set a clear strategic objective to advance its sustainability leadership position – not just nationally, but regionally and globally. The aim was not to achieve this overnight, but to improve its rating by one level each year to create a structured, measurable sustainability journey.
Each step has required stc Group to strengthen its ESG initiatives, improve accountability and embed sustainability more deeply across the organization. The company has now held an AA MSCI ESG rating since 2025. And, although its data governance was strong from the outset, broader corporate governance improvements were a key contributor to the journey from A to AA — particularly ethics, independent oversight and board-level accountability.
Achieving the AA rating has required contributions from sustainability, governance, risk, compliance, cybersecurity, procurement, human resources and other functions. For example, when formalizing a new policy, an additional sustainability lens was applied across all sectors. This involved assessing whether the policy is sustainable, and can be implemented across the group.
The group also considered whether there are existing risks or upcoming legislation relating to the new policy to take into account. The goal was to ensure that future policies and decisions made at the group level are robust, forward-looking and aligned with sustainability principles.
As such, the rating rise has been a company-wide endeavour. Ultimately, the journey has been less about a single initiative and more about how the company has worked together to make sustainability a competitive advantage.
Improving corporate sustainability in the GCC
In July 2026, stc Group's analysis of MSCI ESG Ratings data showed that only 11 of 207 publicly traded Gulf Cooperation Council (GCC) companies had an AA rating – the second-highest level on MSCI’s scale. No companies in the region currently hold the highest AAA rating, showing that corporate sustainability remains an ongoing journey across the region.
Governance and corporate behaviour are closely linked to long-term value creation because of their influence on the quality of decision-making. The World Bank has consistently emphasized that strong institutions and effective governance are fundamental drivers of economic development, private sector growth and resilience.
Further, for companies operating in highly regulated and interconnected sectors like telecoms, these principles translate into stronger operational resilience, improved stakeholder confidence and better preparedness for emerging risks.
This is particularly important in the GCC because telecommunications companies are helping build the infrastructure of economic diversification. They enable the connectivity and digital services on which other sectors increasingly depend.
The practices adopted by companies in the region that have already started to improve governance, therefore, provide a useful starting point for considering how governance standards could continue to develop across all GCC industries.
Improving corporate sustainability
Telecom operators manage critical digital infrastructure, sensitive customer information, extensive supplier ecosystems and increasingly complex cybersecurity risks. Ethical failures, weak controls or poor third-party practices can quickly become business, reputational and stakeholder risks.
That's why, when stc Group set out to improve its governance strategy and consequently increase its rating, one of the most important changes it made was to strengthen ethics and governance disclosures. Its focus was on sustainable board oversight of ethics and external audit of ethical practice.
The company introduced an independent third-party ethics audit and committed to repeat the assessment every three years. This created an external mechanism to challenge the organization in a healthy way, to identify gaps and also to provide greater confidence that ethical standards are being applied in practice, beyond documented policies.
Crucially, the board has maintained oversight of this process, elevating ethics from an operational or compliance matter to a board-level responsibility. This ensures ethical performance remains connected to the company’s broader risk and resilience agenda.
As a result, stc Group has progressed from asking “Do we have the right policies?” to “Are our policies working effectively, what can be improved and can we demonstrate it?”
Lessons from a corporate sustainability journey
1. A rating rise comes from company-wide transformation
Moving from A to AA required different functions to work toward the same objective. Sustainability provided direction, but progress depended on other teams translating that ambition into everyday practices, such as embedding sustainability criteria into decision-making frameworks, assessing ESG risks and protecting data accuracy.
2. Independent challenge creates accountability
The third-party ethics audit, repeated every three years and overseen by the Board, helped create a stronger feedback loop to assess, identify gaps, improve and reassess. For a telecommunications company, this approach is particularly relevant because trust, data protection, cybersecurity and third-party risks are increasingly interconnected.
3. Long-term resilience is crucial
The most important lesson is perhaps that an ESG rating is not simply a score to achieve, it’s a framework for asking a more valuable question: How can we enhance the way we govern, manage risk and operate the business to become more resilient over the long term?
An improved rating is not the end of the corporate sustainability journey. It shows what can be achieved through clear ambition, continuous improvement, cross-functional collaboration and stronger governance.
Corporate sustainability across the GCC region
Saudi Arabia has ambitious goals in terms of responsible business practices and sustainable value creation, including increasing annual foreign direct investment inflows by over 20 times by 2030 to SAR 388 billion.
The GCC’s higher-rated companies can therefore serve as useful examples – not because they represent a finished model, but because the practices they have adopted show which questions to ask and demonstrate potential solutions that others in the region can examine.
Overall, the GCC’s sustainable governance journey depends less on identifying a small group of leaders and more on understanding what successful companies are doing differently when it comes to sustainability, why it works and how those lessons can be adapted by companies across the region.
