UAE Climate Decree 2025: What Businesses Must Know and How StepChange Ensures Compliance

The United Arab Emirates (UAE) has taken a decisive step in climate governance with the enactment of Federal Decree-Law No. 11 of 2024 on the Reduction of Climate Change Effects, which came into force on May 30, 2025. This landmark legislation marks a paradigm shift in the region’s approach to sustainability, positioning the UAE as the first country in the Middle East and North Africa to establish a binding legal framework for climate action. 

The introduction of this Federal Decree-Law marks a watershed moment for the UAE business landscape, and for the first time, climate responsibility is not just a matter of corporate social responsibility but a legally binding obligation. Here’s what you need to know about the decree and how StepChange’s ESG Accelerator platform can help your organization meet these requirements efficiently and confidently.

The Key Objectives of the UAE Climate Decree

• Mitigate GHG Emissions: All sectors must take action to reduce both direct and indirect greenhouse gas emissions.

• Enhance Climate Resilience: Strengthen the capacity of businesses and communities to adapt to climate risks like extreme weather and water scarcity.

• Promote Innovation: Encourage the adoption of new technologies and sustainable business practices.

• Ensure Transparency: Mandate accurate data collection and public reporting to boost accountability.

• Align with Global Standards: Integrate climate action into national strategies such as Vision 2030 and Net Zero by 2050.

Key Provisions and Governance Structure of the UAE Climate Decree

• National Climate Strategy: MOCCAE develops and updates national and sectoral mitigation and adaptation plans with clear targets and timelines.

• Defined Roles and Responsibilities:

  • MOCCAE leads implementation and coordination.

  • Federal and local authorities must integrate climate objectives into their policies and projects.

  • The private sector and individuals are required to comply, report emissions, and implement mitigation and adaptation measures.

• Mandatory Mitigation and Adaptation Programs: All sectors must participate in programs to reduce emissions and address climate risks such as extreme weather and water scarcity.

• National Greenhouse Gas Inventory: MOCCAE will maintain a comprehensive GHG emissions database; all relevant entities must submit accurate data as per official standards.

• Establishment of a National Carbon Registry: A centralized registry will track emissions, carbon credits, and offset projects, supporting both mandatory and voluntary participation.

• Enforcement and Compliance: The law includes mechanisms for inspections, audits, and penalties, with a strong emphasis on transparency, accountability, and regular reporting.

The Scope of the UAE Climate Decree: Who Must Comply?

The law applies to all entities in the UAE, including:

• Large corporations and SMEs

• Factories, offices, shops, and service providers

• Companies in free zones

• International companies with UAE operations

If your business uses energy, operates vehicles, manufactures products, or has any activities that generate emissions, you must comply, regardless of size or sector.

The Scope of the UAE Climate Decree: Compliance Requirements 

1. Measurement, Reporting, and Verification (MRV): 

   1. Measure Emissions: Identify and quantify all GHG emissions

   2. Report Emissions: Submit annual emissions data to the Ministry of Climate Change and Environment (MOCCAE) using approved methods. Reports may require third-party verification, especially for major emitters (entities emitting 500,000 tCO2e or more per year.)

   3. Maintain Records: Keep all emissions data for at least five years for transparency and accountability.

2. Requirements for major emitters vs other companies: 

   1. Companies with annual emissions equal to or exceeding 0.5 million metric tons of CO₂ equivalent (Scope 1 & 2) must:

      1. Register under the UAE National Carbon Registry.

      2. Prepare detailed GHG inventories aligned with the ISO 14064 standard.

      3. Obtain third-party verification of their emissions data from an MOCCAE-approved verifier

   2. Voluntary Registration for Other Companies:

      1. These are companies with annual emissions below 0.5 million metric tons

      2. CO₂e may voluntarily register to participate in the UAE National Carbon Registry and access carbon credit trading opportunities

3. Emissions Reduction Strategies: 

   1. Set Targets: Companies must develop decarbonization targets that align with national sector-specific goals. 

   2. Implement reduction measures: Adopt strategies such as improving energy efficiency, using clean energy, enhancing and protecting Natural Carbon Sinks, carbon capture, use, & storage (CCUS) technologies, alternatives to saturated fluorocarbons, carbon offsetting, etc. 

4. Climate Adaptation Plans

   1. Assess climate risks: Identify how climate change could impact your operations.

   2. Develop adaptation strategies: Prepare plans to address risks like heatwaves, water shortages, or supply chain disruptions.

5. Penalties for Non-Compliance

   1. Fines range from AED 50,000 to AED 2 million for violations, with repeat offenses incurring higher penalties. 

How StepChange Can Help UAE Businesses Meet Climate Decree Compliance: 

The UAE’s Federal Decree-Law No. 11 of 2024 sets a new benchmark for mandatory climate action, requiring businesses to measure, report, and reduce greenhouse gas emissions. For organizations navigating these requirements, StepChange ESG Accelerator platform is designed to be your all-in-one digital solution for climate compliance and sustainability leadership. 

End-to-End Carbon Accounting and MRV

The StepChange platform enables businesses to seamlessly measure, monitor, and report their carbon footprint across Scope 1, 2, and 3 emissions. Our platform automates data collection from multiple sources—energy use, supply chain, transportation, and more—ensuring accuracy and audit-readiness for annual submissions to the Ministry of Climate Change and Environment (MOCCAE)

• Seamless Measurement: Automatically track Scope 1, 2, and 3 emissions across all business activities 

• Automated Data Integration: Connects with all your existing systems to pull real-time emissions data, reducing manual work and errors.

• Centralized Record-Keeping: Securely stores your emissions records for at least five years, meeting all regulatory requirements.

Streamlined Compliance Reporting

With StepChange, preparing your annual compliance reports becomes a straightforward process. The platform generates compliance-ready reports, aligned with UAE law and global standards (such as IFRS S1, S2, ESRS, GRI, BRSR, TCFD, and CDP) and supports third-party verification for major emitters. This reduces the burden on your sustainability teams and ensures you’re always ready for audits.

• Annual Reports Made Easy: Instantly generate compliance-ready reports aligned with UAE law and global standards.

• Audit-Ready Outputs: Instantly generate reports that meet MOCCAE and international standards.

• Third-Party Verification Support: Facilitate independent reviews for high-volume emitters, as mandated by law.

Decarbonization Roadmaps and Target Setting

The platform doesn’t stop at measurement. StepChange provides customized decarbonization pathways based on your sector, business size, and national targets. Built-in analytics recommend actionable steps - like energy efficiency upgrades, renewable energy adoption, waste management improvements, and carbon offsetting - so you can confidently meet or exceed mandated reduction goals. 

• Customized Pathways: Get tailored decarbonization strategies based on your sector, business size, and national targets.

• Science-Based Target Setting: Set and track progress against decarbonization targets aligned with UAE and global best practices.

• Actionable Insights: Receive recommendations for emissions reduction, supported by industry benchmarks.

Climate Risk and Adaptation Planning

StepChange helps you identify and assess climate risks to your operations, supply chain, and assets. The platform guides you through creating robust adaptation plans, ensuring your business is resilient to climate shocks such as heatwaves, water scarcity, and supply chain disruptions.

• Risk Assessment Tools: Visualize and quantify climate risks specific to your business.

• Adaptation Strategy Builder: Develop and monitor adaptation plans in line with regulatory expectations.

Continuous Monitoring and Real-Time Dashboards

With real-time dashboards, StepChange gives you a clear view of your emissions performance, compliance status, and progress toward targets. Automated alerts keep you informed of lags and deadlines, new regulatory updates, and opportunities for improvement.

• Live Compliance Tracking: Instantly see where you stand on all regulatory requirements.

• Intuitive Interface: Customizable modules make sustainability management accessible for teams of any size or expertise level.

Scalable, Sector-Agnostic, and User-Friendly

Whether you’re a large industrial emitter, a financial institution, or an SME, the StepChange platform is built to scale with your needs. Its intuitive interface and customizable modules make sustainability management accessible for teams of any size or expertise level

Why Choose StepChange: 

• Insight-Driven Climate Management: The platform is engineered to meet compliance requirements like the UAE Federal Decree-Law No. 11 of 2024, and is designed to put climate intelligence at the heart of your business, to enable proactive, data-backed decisions for sustainability and value creation.

• Globally Accredited and Licensed: StepChange is accredited by leading frameworks including PCAF (Partnership for Carbon Accounting Financials), GRI (Global Reporting Initiative), and is IFRS licensed (2024) for sustainability disclosures - giving you confidence in your data and reporting.

• Developed by Climate Scientists and Industry Experts: The platform is built and continuously updated by a team of climate scientists, ESG professionals, and regulatory experts, ensuring scientific rigor and practical relevance.

• Science-Based and Enterprise-Grade: StepChange is purpose-built for enterprises, financial institutions, regulators, and complex organizations that require robust, science-based climate management tools. 

• User-Friendly and Scalable: Designed for organizations of all sizes, the intuitive interface and customizable modules make it easy to onboard teams and scale your sustainability program as you grow.

• Trusted by Industry Leaders: StepChange is relied on by major enterprises and leading financial institutions globally for its reliability, scalability, and depth of climate expertise.

The StepChange platform offers UAE businesses a single, powerful tool to meet every aspect of the new climate law - from emissions measurement and reporting to reduction strategy, risk management, and compliance documentation. By digitizing and automating the entire compliance journey, StepChange turns regulatory obligations into strategic opportunities for efficiency, resilience, and market leadership.

Ready to make climate compliance simple and strategic? Book a demo with StepChange and see how our platform can future-proof your business under the UAE Climate Decree.