By Dr. Sunita Mathur, Assistant Professor at Heriot-Watt University Dubai

Entrepreneurship is a challenging yet rewarding endeavor, and financial planning plays a crucial role in determining the success and longevity of any business. The UAE is one of the most attractive destinations for entrepreneurs due to its business-friendly environment, strategic location, and tax advantages. As the Middle East’s startup ecosystem thrives, the UAE continues to cement its status as the region’s leading destination for entrepreneurs. In Q2 2024 alone, the country registered 5,600 new businesses, reflecting its investor-friendly policies, robust infrastructure, and access to capital. However, financial planning is crucial to ensure sustainability and long-term success. Entrepreneurs must navigate various factors, including startup costs, taxation, funding options, and regulatory framework.

The first step in financial planning is choosing the right business structure. Entrepreneurs in the UAE can opt for mainland companies, which allow businesses to operate anywhere in the UAE but require local sponsorship for certain activities. UAE is home to several prominent free zones that attract startups, such as Dubai International Financial Centre (DIFC), which has a total number of 5,523 active companies and Jebel Ali Free Zone (JAFZA), just to name a few. According to Dubai Chamber of Commerce, in the first nine months of 2024, 51,561 new companies joined as members. By the end of the third quarter, ADGM had issued 759 new business licenses. Free zone companies offer 100 per cent foreign ownership, tax benefits, and simplified setup procedures but often have geographical restrictions on trade. Offshore companies are primarily used for international trade, asset protection, and tax optimisation but cannot conduct business within the UAE. Setting up a business involves costs such as trade license fees, visa expenses, and office rentals. Entrepreneurs should budget for these upfront costs and factor in annual renewal fees to avoid disruptions.

Securing adequate funding is another major consideration for entrepreneurs. While self-financing is an option for some, many businesses require external capital to scale. Entrepreneurs in the UAE have several funding options, including bank loans, but these require strong credit history and collateral. Angel investors and venture capital firms provide funding and mentorship through hubs like DIFC FinTech Hive, Hub71, and Sheraa alone, has supported 180 startups with 52% of women startups generating revenue of USD 248M since its inception in 2016. Government grants and programs such as Dubai SME, Khalifa Fund, and Ghadan 21 offer financial support for startups and innovative businesses. Islamic financing options like Murabaha and Ijara provide Sharia-compliant alternatives. Selecting the right funding source depends on the business model, growth stage, and financial goals.

Managing cash flow efficiently is critical for businesses in the UAE, as payment cycles can be lengthy, especially in industries reliant on government contracts or large corporate clients. Entrepreneurs need to maintain a liquidity buffer to cover at least six to twelve months of operational expenses, plan for delayed payments, which are common in some sectors, and open a corporate bank account early, as the process can take several weeks due to compliance checks. By closely monitoring cash flow, businesses can ensure they have enough working capital to sustain operations and invest in growth opportunities.

While the UAE is known for its tax-friendly environment, entrepreneurs must comply with VAT and corporate tax regulations. Businesses with annual revenues exceeding AED 375,000 must register for VAT and file returns quarterly. A corporate tax of 9 per cent introduced in 2023 applies to businesses earning over AED 375,000 in taxable income, with exemptions for Free Zone businesses meeting specific criteria. Entrepreneurs involved in international trade should also consider customs duties and withholding tax obligations. Proper tax planning ensures compliance and avoids penalties.

The UAE is a highly competitive market, and pricing strategies must be carefully developed to ensure profitability. Entrepreneurs should conduct market research to determine competitive pricing, account for currency fluctuations, especially if dealing with international suppliers, and consider operating costs such as rent, salaries, and logistics when setting prices. Regularly reviewing pricing structures can help maintain profit margins while remaining competitive.

Entrepreneurs must also be prepared for potential risks, including economic downturns, regulatory changes, and industry-specific challenges. Key risk management strategies include business insurance, which is mandatory for employees and can safeguard assets; diversification to avoid over-reliance on a single revenue source or market; legal compliance to prevent financial and operational complications; and establishing an emergency fund to cover unforeseen expenses and prevent financial strain during challenging times. As per Dubai SME and other reports, 80 per cent of startups in the UAE fail within the first 2 years, and the key reasons for failure include lack of funding, regulatory challenges and market saturation in certain industries such as e-commerce.

Expanding a business in the UAE requires careful financial planning. Entrepreneurs should leverage the UAE’s strategic location to expand into GCC and MENA markets, explore dual licensing options to operate in both Free Zones and the Mainland, seek government incentives for innovation-driven businesses, and consider forming strategic partnerships to gain market access and reduce costs. Expansion should be backed by financial feasibility studies to ensure sustainable growth.

A well-planned exit strategy is essential for long-term financial success and ensures that entrepreneurs can maximise the value of their business when transitioning out.

Financial planning is a fundamental aspect of entrepreneurial success in the UAE. By carefully considering business setup costs, managing cash flow, securing appropriate funding, staying compliant with tax regulations, and planning for risks and growth, entrepreneurs can build sustainable businesses. With the right financial strategies in place, they can take full advantage of the UAE’s dynamic business environment and achieve long-term success.

• Contributors: Kush Ahuja, Head of Eurasia and Middle East at ACCA; and Sam Achampong, Regional Director of CIPS

As global challenges – from climate change to resource scarcity – intensify, regional businesses are increasingly recognising the strategic imperative of embedding Environmental, Social, and Governance (ESG) principles into their operations. In this context, finance and procurement teams are playing a crucial role in aligning corporate strategies with sustainability goals. Here, Kush Ahuja, Head of Eurasia and Middle East at ACCA, and Sam Achampong, Regional Director of CIPS, provide valuable insights into how these functions can collaborate to advance ESG priorities.

Collaboration between finance and procurement: A new imperative

As sustainability becomes a top priority for businesses globally, the integration of ESG criteria into corporate strategies is essential. In this transition, both finance and procurement teams are emerging as critical partners, leveraging their distinct yet complementary expertise. Finance teams bring their proficiency in quantifying the value of sustainable investments and aligning them with long-term profitability, while procurement professionals ensure these investments are underpinned by ethical and sustainable sourcing practices. This collaborative dynamic is instrumental in embedding ESG principles across entire value chains and achieving meaningful sustainability outcomes.

Ahuja highlights: “Finance professionals are critical in quantifying the value of sustainable investments, enabling businesses to make informed decisions that balance profitability with long-term impact. Through transparent ESG reporting and risk management, accountants can guide organisations toward greener pathways.”

Achampong adds: “Procurement professionals are in a position of responsibility to ensure ethical and sustainable sourcing. By working closely with finance teams, they can align procurement policies with broader ESG goals, ensuring the entire value chain contributes to a company’s sustainability agenda.”

This collaboration is particularly significant in the Middle East, where mega-projects and transformative initiatives such as NEOM and Masdar City are setting global benchmarks for sustainable development. Finance teams can identify and allocate capital for green projects, while procurement ensures these investments are executed responsibly through sustainable supply chains.

The evolving ESG compliance landscape

The regulatory environment surrounding ESG is rapidly evolving, with governments across the Middle East introducing stricter compliance requirements. From the UAE’s Net Zero by 2050 initiative to Saudi Arabia’s Vision 2030, organisations are under increasing pressure to demonstrate their commitment to sustainability.

“The demand for consistent ESG reporting standards is growing,” explains Ahuja. “At ACCA, we encourage finance professionals to adopt frameworks such as those developed by the International Sustainability Standards Board (ISSB) to ensure transparency and comparability in ESG disclosures. This is critical for attracting investment and building trust among stakeholders.”

The numbers are compelling. A 2023 report by the World Economic Forum highlights that $2.4 trillion annually is required to transition to a low-carbon economy globally by 2030. Additionally, green bond issuance has surged, reaching a projected $500 billion in 2024, reflecting growing investor appetite for sustainable projects.

Achampong highlights the importance of embedding ethical procurement practices to meet these compliance requirements. “Procurement functions must integrate ESG criteria into supplier selection and contract management processes. This means prioritising suppliers who adhere to fair labour practices, reduce carbon emissions, and minimise environmental impact,” he says. Recent studies also indicate that companies with strong ESG practices see a 10-20% increase in valuation compared to peers who lag behind.

Key challenges and opportunities

Integrating ESG principles into finance and procurement is not without challenges. One of the primary hurdles is resistance to change within organisations. Achampong comments: “Implementing new ethical procurement policies often requires a cultural shift, which can face pushback from stakeholders who are accustomed to traditional practices. However, with the right training and leadership, this resistance can be overcome.”

Ahuja agrees that ESG brings fresh ethical challenges but sees financial professionals as uniquely well-placed to help businesses manage the ethical dilemmas they regularly encounter. A recent ACCA report on ethical dilemmas highlights that 54% of finance professionals have faced pressure to act unethically in their roles, underscoring the need for strong ethical leadership. “With the right frameworks and governance in place, finance teams can play a pivotal role in navigating these challenges, ensuring ESG commitments translate into real-world impact while maintaining business integrity,” Ahuja comments.

Another challenge is the lack of consistent ESG data. “Without reliable metrics, it becomes difficult to measure progress and make informed decisions,” says Ahuja. “Finance professionals must advocate for the adoption of robust data collection and reporting systems to bridge this gap.”

Despite these challenges, the opportunities are immense. Organisations that successfully integrate ESG into their strategies can unlock new revenue streams, enhance brand reputation, and mitigate risks. For example, businesses that adopt sustainable procurement practices often realise cost savings through improved resource efficiency and reduced waste. Moreover, the shift towards ESG compliance is increasingly demanded by consumers, 76% of whom say they prefer brands aligned with their ethical values.

Practical steps toward ESG best practice

To align financial reporting and procurement practices with ESG goals, Ahuja and Achampong recommend the following steps:

1. Adopt comprehensive ESG frameworks: Finance teams should leverage internationally recognised frameworks, such as the ISSB standards, to ensure consistent and transparent ESG reporting. This helps build credibility with investors and stakeholders.
2. Adopt relevant learning strategies: As ESG is an evolving discipline, professionals must continuously enhance their knowledge and skills. Organisations should invest in education and training to equip teams with the expertise required to navigate ESG complexities. Recognising this need, ACCA has launched the Professional Diploma in Sustainability to help finance professionals develop essential sustainability competencies.
3. Develop an ethical procurement strategy: Procurement functions should implement policies that prioritise sustainability and ethics. This includes sourcing from suppliers who meet rigorous environmental and social criteria, conducting regular audits and ensuring transparency across the supply chain.
4. Enhance collaboration across functions: Breaking down silos between finance and procurement teams is essential. Joint training sessions and cross-functional task forces can foster collaboration and ensure alignment on ESG goals.
5. Leverage technology: Digital tools can play a significant role in tracking and reporting ESG performance. From blockchain for supply chain transparency to AI-driven analytics for risk assessment, technology enables organisations to make data-driven decisions.
6. Engage stakeholders: Engaging employees, suppliers and customers in sustainability initiatives can create a culture of accountability and drive collective action toward shared goals.
7. Quantify long-term benefits: Organisations should calculate the long-term financial and social returns of ESG investments. For example, studies show that energy-efficient buildings can reduce operational costs by up to 30%, while ethical sourcing practices can mitigate reputational risks.

Achieving thorough ESG goals requires concerted efforts from finance and procurement professionals. Ahuja concludes: “The finance function holds the key to directing investments toward impactful projects, while procurement ensures these investments are executed sustainably. Together, they can drive meaningful change.”

Achampong echoes this sentiment, stating: “By embracing ethical and sustainable practices, businesses in the Middle East can not only meet regulatory requirements but also position themselves as global leaders in ESG.”

Through collaboration and a firm commitment to embedding ESG principles into core business strategies, finance and procurement teams have the power to drive tangible and lasting change. By aligning investments with sustainability objectives and ensuring ethical practices across supply chains, they can mitigate climate risks, foster economic resilience, and enhance social equity.

By Lu Zhou – CEO Vanquour

When Hussain Sajwani, CEO of DAMAC, pledged $20 billion to build U.S. data centers alongside Donald Trump, he wasn’t just making a business deal—he was making his opening move in a high-stakes game of chess. Each piece on this digital chessboard represents an opportunity for transformation: the U.S., a powerhouse of technological innovation, and the UAE, a rising titan with visionary ambitions. Together, they’re setting the stage for a game-changing partnership that could reshape the global digital economy.

As Sajwani declared, “We are building more than data centers—we are building a future.” This isn’t hyperbole; this is strategy. With Trump’s pro-business agenda promising reduced regulations and incentivized investment, Sajwani’s move is a masterstroke in aligning Middle Eastern capital with American expertise.

The Opening Gambit: Strategic Investment

Like a grandmaster’s opening gambit, Sajwani’s $20 billion pledge is both calculated and bold. Data centers are the lifeblood of the digital economy, powering everything from AI to cryptocurrency. By choosing this sector, the UAE is positioning itself as more than a financial backer—it’s becoming a global partner in innovation.

This move is not just about technology; it’s about vision. It signals to the world that the UAE is ready to play on the global stage, not as a spectator but as a strategist driving the future of digital infrastructure. Just days after Damac’s news, the announcement of Jared Kushner’s partnership with UAE’s Mohamed Alabbar on the Belgrade development further underscores the significance of strategic business alliances between the UAE and the US. It’s a challenge to others in the Gulf: the time to act is now.

Middle Game: The Synergy of Two Economies

The chessboard analogy doesn’t end here. The mid-game strategy is where the magic happens, and the U.S.-UAE partnership has endless potential for innovative collaboration. Imagine this: Silicon Valley’s tech pioneers join forces with Abu Dhabi’s AI research labs, while Dubai’s blockchain innovators connect with Wall Street’s fintech disruptors. These aren’t just hypothetical scenarios—they’re the logical next moves in a game where mutual prosperity is the ultimate checkmate.

Sajwani’s pledge isn’t an isolated act; it’s an invitation. It challenges other Gulf entrepreneurs to follow suit, forging bold partnerships that break barriers and accelerate progress. Similarly, it’s a call to U.S. businesses to recognize the UAE as more than a market—it’s a partner, a hub, and a gateway to broader Middle Eastern opportunities.

Endgame: A Future Defined by Collaboration

In chess, the endgame determines whether strategy and vision translate into victory. For the U.S. and UAE, the goal is a lasting partnership that redefines the boundaries of economic and technological collaboration. Sajwani’s investment sets the tone, but the success of this partnership lies in its ability to inspire a ripple effect.

This is the moment for both nations to think big. Why stop at data centers? The UAE’s strengths in renewable energy, logistics, and cutting-edge tech make it a natural ally for U.S. companies looking to expand their global footprint. Similarly, American entrepreneurs can unlock unprecedented opportunities by investing in the UAE’s ambitious vision for the future.

Bold Moves, Shared Futures

Sajwani’s $20 billion pledge is more than just a move—it’s a statement of intent. It’s a declaration that boldness, vision, and strategy can bridge markets, industries, and cultures. It’s a challenge to dream bigger, aim higher, and build a future that’s collaborative, inclusive, and groundbreaking.

As Sajwani himself said, “This is about more than dollars. This is about shaping a shared future that is as bold and ambitious as the visionaries behind it.” This is not just economic diplomacy—it’s a digital renaissance, a shared vision of progress that will shape the world for decades to come.

The chessboard is set, the pieces are in motion, and the next move belongs to all of us. Will we rise to the challenge? If this is the opening move, the possibilities are limitless.