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Management Discussion and Analysis



The ethos which guide us

For Tadawul, performance is not market statistics and the bottom line alone. The impact made on the economy, the environment, and the society in general is equally important.

Tadawul does not take a narrowly focused, purely bottom-line oriented or market-centric approach in its activities. It is very much aware of the importance of environmental, social and governance (ESG) aspects in the present global context. Issues such as climate change are increasingly in the forefront. Frequency and magnitude of natural disasters are on the rise. Dialogues that occur at global economic and business forums constantly remind us of the need for action.

The Vision 2030 is the blueprint that guides all aspects of the developmental plans of the Kingdom. The core of the Vision is its three themes; a vibrant society, a thriving economy, and an ambitious nation. They intrinsically mesh with the sustainability concept. In today’s context, safeguarding the environment is indispensable when building a vibrant society. Likewise, nurturing the skills of the population is essential for economic development. A socially conscious business sector is a vital facet for an ambitious nation. Tadawul contributes to all the aforementioned activities under the respective themes in its sustainability programmes.

Thirteen delivery programmes have been launched under the overarching framework of Vision 2030, the most prominent of which is the Financial Sector Development Program (FSDP). The first objective of the Program is the formation of an advanced capital market. The FSDP has also identified the major challenges facing the financial services sector; among them are gaps in financial inclusion and a relatively low rate of financial literacy.

In 2018, Tadawul became a member of the Sustainable Stock Exchanges (SSE) which is a United Nations (UN) partnership programme including 96 stock exchanges globally. SSE seeks to provide a framework where stock exchanges, together with market participants, can drive enhanced performance on ESG issues.

To fulfil its commitments under the membership of SSE, Tadawul has identified five of the UN Sustainable Development Goals (SDGs) towards which its advocacy activities and assistance to market participants on sustainability issues will be primarily targeted. The five goals are:

Board room diversity and
gender equality

Climate action and
green finance

SME growth and
sustainable development

Partnerships for sustainable and
transparent capital markets

Reporting on environmental,
social and governance

Today, there is a global trend for corporate and fund managers to incorporate ESG factors into their decision-making. The focus of corporate governance discussions has also accordingly broadened.

Stock exchanges are playing an increasingly important role in promoting the cause of sustainable development. They are well placed to build capacity by promoting understanding of new ESG standards, products, services, and practices. This can be done through training activities such as seminars, workshops, large conferences and online courses. Such activities can be supplemented by printed educational materials and mentorship programmes. Other promotional activities such as bell-ringing ceremonies and communication campaigns can also contribute to the cause.

Details of our efforts are given under the respective sections below.

Our contribution

Tadawul fervently believes that it has a role to play in the sustainable development of the Kingdom, and the realization of the goals of Vision 2030, the FSDP and the UN SSE initiative. It also works towards the sustainability of local communities.

Tadawul endeavours to improve financial literacy and investor savviness among members of the society to augment its contribution to the economy.