Rising Expectations For Sustainability In 2026: 10 ESG & Sustainability Predictions

2026 is shaping up to be a pivotal year for sustainability leaders. After a turbulent 2025, characterized by regulatory uncertainty and politicization, the focus is shifting toward measurable impact and financial returns, while responding to mounting demands from external stakeholders. In 2026, we predict that:

1. AI agents will accelerate delivery and management of sustainability data, but businesses need to take precautions.
Organizations will increasingly deploy AI agents for near-real-time sustainability insights. While these tools promise efficiency, insufficient governance could lead to high-profile errors, exposing firms to reputational and financial risks.

2. Disclosures of water scarcity metrics will surge.
Investor pressure is expanding beyond climate to water risks. We predict that corporate disclosures to CDP on water scarcity will rise significantly, driven by an increasing number of assets at risk of water scarcity and increased usage from data centres and low-carbon technologies.

3. CFOs will demand business justifications from sustainability initiatives.
Without regulatory drivers, sustainability spending will be under increased scrutiny. In 2026, more CFOs will demand clear ROI before committing to sustainability initiatives, forcing sustainability leaders to work with financial teams to link projects to efficiency, cost savings and revenue growth.

4. Circularity will gain momentum, with growing pressure from customers.
Customer demand for sustainable products is rising, and firms will increasingly adapt to shifting consumer preferences. In the chemicals sector, we expect three in five new products to embrace ecodesign principles, supported by advanced recycling and circular feedstocks.

5. Sustainability consulting firms will increasingly leverage value-based pricing models.
As AI improves the speed and efficiency of consulting delivery – and as businesses increasingly require demonstrable financial returns from sustainability initiatives – consulting providers will move away from time-based billing toward outcome-based fees linked to core business value.

6. Consolidation across many categories of sustainability software will accelerate.
With buyers focusing more on software solutions that support enterprise-wide sustainability initiatives, we expect at least 10 acquisitions in sustainability software as vendors race to offer integrated platforms and broaden capabilities.

7. Packaging-specific EPR regulations in APAC will drive more competition from software vendors.
New mandatory frameworks in APAC, driven by waste challenges and global alignment efforts, will prompt at least five software vendors to launch new modules designed to support APAC packaging EPR regulations.

8. Software vendors will provide more functionality to suppliers to support sustainability initiatives – and not just their reporting efforts.
As organizations increasingly embed sustainability criteria into their procurement processes, at least 10 software vendors will invest in solutions that streamline supplier compliance and improve sustainability metrics, easing the disclosure burden on suppliers.

9. Assurance of product sustainability data will increase significantly.
With both an increase in regulations requiring assurance and more reliability in lifecycle assessment practices, we expect that over a third of FTSE 250 firms will publish independent assurance opinions on product sustainability claims in 2026.

10. With fragmented regulations, investors will push firms to increase the number of sustainability metrics they disclose.
Regulatory delays will not slow investor expectations or demands for sustainability information. Mid-cap and private firms will double the amount of disclosed sustainability data as investors seek deeper insights into operational risks, environmental impact and long-term value creation.

Sustainability leaders who embrace – and plan for – these trends will set the pace for a new era of accountability. For more detail on our predictions, please see Market Insight: 10 Predictions For ESG & Sustainability In 2026 And Beyond.