Saudi companies recorded the largest increase in disclosure of sustainability information among the 22 economies included in a study by the International Federation of Accountants, after the percentage of disclosing companies within the Saudi sample increased from 52 percent to 98 percent during the year 2024, an increase of 46 percentage points.
The study, prepared by the International Federation of Accountants in cooperation with the American Institute of Certified Public Accountants and the Chartered Institute of Management Accountants, and which included about 1,400 of the largest companies in the economies under study, showed that 84 percent of Saudi companies included sustainability information in their annual or integrated reports, which strengthens the link between financial and non-financial information and provides a more comprehensive picture of the companies’ performance.
As part of developing the sustainability disclosure system, the Saudi Organization for Auditors and Accountants (Sukba) translated the international sustainability disclosure standards “IFRS S1” and “IFRS S2,” issued by the International Sustainability Standards Board, into the Arabic language, under an official licensing agreement with the International Financial Reporting Standards Foundation.
The initiative received international appreciation, as the United Nations, represented by the Intergovernmental Group of Experts on International Standards of Accounting and Reporting of the United Nations Conference on Trade and Development, awarded the Authority the “ISAR Honors 2025” award, in recognition of its contribution to translating international sustainability standards and making them available in Arabic, and its role in disseminating professional knowledge and enhancing transparency and quality of financial and non-financial reports.
The Authority also adopted the International Standard for Sustainability Information Assurance No. 5000, issued by the International Review and Assurance Standards Board, which specifies the general requirements for implementing sustainability information assurance engagements, and helps enhance the consistency of procedures and the quality of results, regardless of the disclosure framework used.
The Authority also adopted international standards of professional conduct and ethics related to confirming sustainability information, including independence standards issued by the International Standards Council for Professional Conduct and Ethics, in a way that enhances integrity, objectivity, and professional independence and reduces the risks of conflicts of interest when providing assurance services.
These steps come as an extension of the Authority’s efforts to adopt international standards for financial reporting, auditing, quality management, and professional conduct and ethics. The International Federation of Accountants has previously highlighted the Kingdom’s distinction as the only country in the Middle East, and among a limited number of countries in the world, that has met the requirements for adopting the international system of professional standards in an integrated manner, according to what the authority reported.
The integration between disclosure standards, confirmation requirements, and professional conduct controls enhances confidence in published information, increases its comparability and reliance on it, in a way that supports the efficiency of financial markets and the attractiveness of the investment environment in the Kingdom, and is in line with the goals of “Vision 2030.”
Sustainability disclosures include information related to risks and opportunities related to climate, environment, natural resources, social aspects and governance, and the financial and operational implications they may have on companies. This information is important for investors and financiers, as it helps them evaluate companies' ability to manage risks and achieve value in the long term.
On Tuesday, Mercedes-Benz became the third largest German automaker to lower its forecasts for the current year, in light of the difficult conditions in China, which reflects the scale of the crisis facing the sector.
The company said that its core operating profits for 2026 are expected to stabilize at last year's level, amounting to 5.8 billion euros ($6.5 billion), attributing this to difficulties in China, the largest automobile market in the world, as well as high costs of raw materials.
The company had previously expected an increase in profits of at least 15 percent.
Mercedes-Benz lowered its profit margin expectations in the core automotive sector to between 2 and 3 percent during the year, compared to its previous estimate of between 3 and 5 percent.
Following the announcement, the company's shares fell by 4.2 percent, while Volkswagen and BMW shares fell by slightly more than 2 percent each.
BMW and Volkswagen have already lowered their expectations for the current year, in light of the decline in demand and the intensification of competition with local Chinese companies, including BYD and Xiaomi, which has put pressure on profits.
Deliveries of Mercedes-Benz cars in China fell by 29 percent during the nine months ending in September, after last year they had recorded their lowest levels since 2016.
The decline in the ability of German car companies to compete in the Chinese market has led to the imposition of painful adjustments on the sector, which is considered one of the largest employment sectors in Germany.
Mercedes-Benz CEO Ola Källenius called on workers in Germany to work overtime without pay, in conjunction with the company expanding the scope of its manufacturing operations in Hungary, where he said that costs are about 70 percent lower than in Germany.
For its part, Volkswagen intends to reduce the number of its global employees by about 120,000 jobs by the end of the decade, in a restructuring process that is considered the largest in the history of the automobile industry, exceeding the reduction of 50,000 jobs following the bankruptcy of General Motors in 2009.
Mercedes-Benz announced, in preliminary results, that its core operating profits amounted to 1.77 billion euros during the third quarter, while the profit margin in the automotive sector recorded 2.5 percent.
The company is scheduled to announce its full results for the third quarter on Wednesday.
US stock index futures were largely stable, Tuesday, with crude oil prices remaining near their highest levels in six weeks, while investors awaited a group of major companies’ business results and the US Federal Reserve’s decision on interest rates during the current week.
It is widely expected that the Federal Reserve will keep interest rates unchanged on Wednesday, after raising them last month. However, the markets expect it to be raised at least two additional times by mid-2027, in light of the continued rise in major inflation indicators, coinciding with the ongoing war between the United States and Iran.
“Although we do not expect a change in interest rates this week, we do not rule out raising them, even if we are not convinced of the urgency of this step,” said John Felice, head of Americas strategy at BNY.
He added: “We believe that maintaining credibility is extremely important for the Federal Reserve, and as its Chairman, Kevin Warsh, constantly reminds us, inflation has exceeded the target level for more than 60 consecutive months.”
Crude oil prices rose slightly on Tuesday, after declining in the previous session, while Brent crude approached its highest levels since late April.
By 05:17 a.m. EST, Dow Jones futures rose by 0.14 percent, or 70 points, and Standard & Poor's 500 futures rose by 0.05 percent, or 3.75 points, while Nasdaq 100 futures rose by 0.01 percent, or two points.
Shares of giant American companies and growth stocks recorded mixed performance. Tesla shares rose by about 1 percent in pre-market trading, after jumping by more than 5 percent during the previous session.
Meta Platforms shares stabilized, after the company raised the size of the largest capital increase through the issuance of shares in its history to $97.5 billion, to finance its expansion in the field of artificial intelligence.
On the other hand, Whirlpool shares fell by 8.8 percent, after the home appliance company announced a loss in the third quarter, and its revenues fell below analysts’ estimates.
Major companies, including Coca-Cola, Boeing, and PayPal, are scheduled to announce their business results before the markets open on Tuesday.
Investors are also awaiting the results of the giant cloud computing companies “Alphabet”, “Microsoft” and “Amazon” later in the week, searching for indications of the extent to which huge investments in artificial intelligence have succeeded in achieving actual growth.
Jefferies stock strategist, Jane Gibbons, said in a note that the growth in profits of the “Great Seven” companies may lag behind the rest of the Standard & Poor’s 500 index companies. The company expects the profits of the group, which includes the largest American technology companies, to grow by 21 percent, compared to 32 percent for the rest of the companies included in the index.
Artificial intelligence stocks have been under pressure this month, amid growing concerns about the difficulty of justifying debt-financed spending as borrowing costs rise.
However, investor sentiment improved somewhat during the previous session, after the artificial intelligence company Anthropic revealed that it had filed for public offering of its shares, in an important step towards a listing that may be a record, despite its disclosure of significant losses and safety concerns.
This development helped support the shares of chip manufacturers, after weeks of sharp declines, along with the shares of other companies expected to benefit from the expansion of the use of artificial intelligence, including photonic product companies and specialized cloud computing service providers, known as “NuCloud.”
In a separate context, investors are awaiting the US midterm elections scheduled for November 3, which will determine who will control Congress.
