Sustainability Regulatory Movement Is Picking Up: The When And Where Of It All

The last few weeks have brought some much-needed clarity to the sustainability regulatory landscape, with fresh momentum in some jurisdictions and returning momentum in others. Following the uncertainty and perceived slowdown of 2025, regulation is now adapting and expanding in form and scope. In South Korea and New York, emerging reporting requirements are emphasizing value chain transparency, pushing firms to account for upstream and downstream emissions. California and the UK are giving businesses time to build reporting capability: California through a phased approach by GHG Scope, and the UK through a voluntary but standardized framework that allows firms to align with international norms before mandatory adoption. The EU is taking a calibrated approach, narrowing certain reporting requirements through the Omnibus package, while embedding climate policy into industrial and geopolitical objectives and tightening long-term emission targets (food for thought: is the EU greenhushing?).

Notably, in:

• South Korea, the Financial Services Commission has released a draft roadmap for mandatory climate-related sustainability disclosures for large, listed firms – those on the KOSPI Index with assets above KRW 30 trillion (USD 20.4 billion). Reporting would begin with 2027 data, disclosed in 2028, with plans to extend requirements to smaller firms over time. This launch accompanies the Korea Accounting Standards Board’s finalization of Sustainability Reporting Standards, which are broadly aligned the ISSB’s standards.
• The US, the California Air Resources Board (CARB) has set August 10, 2026, as the first disclosure deadline for corporate GHG emissions (Scope 1 and Scope 2) under SB 253, through its approval of the California Corporate Greenhouse Gas Reporting and Climate-Related Financial Risk Disclosure Initial Regulation. Meanwhile, the New York State Senate passed a series of environmental legislative initiatives in February, including a proposed Climate Corporate Data Accountability Act that would introduce mandatory reporting of direct and value chain GHG emissions for large firms (keep an eye out for our upcoming report on North American sustainability regulations).
  
• The UK, the Department for Business and Trade has finalized the UK Sustainability Reporting Standards (UK SRS), based on the IFRS Foundation’s sustainability and climate standards (see Verdantix Strategic Focus: Understanding ESG And Sustainability Regulations In The UK). The aim is to enable more consistent reporting on sustainability-related financial risks, opportunities and impacts. The standards are voluntary for now, but the government plans to consult later this year on which entities will need to apply them and when.
• The EU, member states have taken the final major step towards adopting the Omnibus proposal to simplify parts of the sustainability regulatory framework, including narrowing the scope of the CSRD and CSDDD and clarifying implementation timelines (keep an eye out for Verdantix An ESG And Sustainability Regulatory Update For Europe). At the same time, new policy initiatives point in the opposite direction. The Industrial Accelerator Act introduces ‘made-in-the-EU’ and low-carbon requirements for selected sectors and net zero technologies. Member states have also approved amendments to the EU Climate Law that would require a 90% reduction in greenhouse gas emissions by 2040 and allow the use of carbon credits towards these targets. Together, these moves reflect a shift towards embedding climate policy within a broader industrial and geopolitical strategy.

Given all of these regulatory developments, businesses should focus on building robust sustainability reporting capabilities to prepare for increasingly complex disclosure requirements across jurisdictions. Extended or phased implementation windows should be used strategically: to establish robust data systems, link sustainability metrics to financial and operational decision-making, and create reporting processes that deliver accurate, credible and auditable information – as well as generate actionable insights (see Verdantix Green Quadrant: Sustainability Consulting (2026)). Firms that approach reporting systemically, rather than tactically, will turn sustainability data into a strategic asset, while also meeting disclosure requirements.