Sustainability Reporting Regulations

Author: Tess Konnovitch, Scientific Marketing Manager

Introduction

If you've been trying to keep up with sustainability reporting requirements lately, you're not alone. The regulatory landscape has shifted significantly over the past few years — and it continues to shift. Some major rules are now in effect. Others have been delayed, paused, or revised. A few are still taking shape.

This guide is designed to cut through the noise. Whether you're a sustainability manager trying to understand your compliance obligations, a business leader assessing risk across your value chain, or a practitioner helping clients navigate the landscape, this is your reference point.

We'll define the key terms, walk through the major regulations by geography, and give you an honest picture of where things stand today. This is a global piece — because for companies operating across borders, the regulatory reality is a global one.

Please note: This regulatory landscape is constantly evolving, and requirements vary by jurisdiction, company size, and business model. This overview is for reference only—the best way to determine which regulations apply to your specific business is to book a consultation with our team.

Key Terms, Defined

Before diving into specific regulations, it helps to have a shared vocabulary. Here are the terms you'll encounter most often:

Scope 1, 2, and 3 Emissions

These categories come from the Greenhouse Gas (GHG) Protocol and define how a company accounts for its carbon emissions:

• Scope 1: Direct emissions from sources owned or controlled by the company (e.g., fuel burned in company-owned vehicles or facilities).
• Scope 2: Indirect emissions from purchased electricity, steam, heat, or cooling.
• Scope 3: All other indirect emissions across a company's value chain — upstream (suppliers, raw materials) and downstream (product use, end-of-life). This is typically the largest and most complex category.

GHG Inventory

A GHG inventory is a systematic accounting of a company's greenhouse gas emissions across Scopes 1, 2, and 3. It is the foundation of most corporate climate reporting frameworks.

Life Cycle Assessment (LCA)

An LCA is a standardized methodology (governed by ISO 14040 and 14044) for evaluating the environmental impacts of a product, process, or system across its entire life — from raw material extraction through end-of-life. LCA goes beyond carbon to include water use, land use, ecotoxicity, and more.

Organizational LCA (O-LCA)

O-LCA extends the LCA methodology to an entire organization rather than a single product. It provides a comprehensive, science-based picture of an organization's environmental footprint across its full value chain — and is increasingly referenced in corporate sustainability reporting frameworks.

Environmental Product Declaration (EPD)

An EPD is a standardized, third-party verified document that communicates the environmental impact of a product based on LCA data. EPDs are increasingly required by procurement programs, green building standards, and emerging regulations.

CSRD / ESRS

The Corporate Sustainability Reporting Directive (CSRD) is the EU's mandatory sustainability reporting framework. It requires companies to report according to European Sustainability Reporting Standards (ESRS), which cover climate, biodiversity, social topics, and governance.

ISSB / IFRS S1 and S2

The International Sustainability Standards Board (ISSB), established under the International Financial Reporting Standards (IFRS) Foundation, has issued two global baseline standards: IFRS S1 (general sustainability-related disclosures) and IFRS S2 (climate-related disclosures). Many countries — including Australia, Singapore, the UK, and others — are adopting or aligning their national frameworks with ISSB standards, making it an increasingly important global reference point.

Double Materiality

A concept central to the EU's CSRD: companies must assess both how sustainability issues affect their business (financial materiality) AND how their business affects people and the environment (impact materiality). This is a broader standard than what most non-EU frameworks have historically required.

The Regulatory Landscape by Geography

United States

The US climate related regulatory picture is in flux, shaped by both federal uncertainty and accelerating state-level legislation.

SEC Climate Disclosure Rule: The The U.S. Securities and Exchange Commission (SEC)'s climate disclosure rule — finalized in March 2024 — would have required public companies to disclose Scope 1 and 2 emissions and material climate-related risks in their financial filings. It was challenged in court almost immediately, and the SEC voluntarily paused implementation in April 2024. The rule's future remains uncertain, particularly given the current administration's posture on climate regulation.

California SB 253 (Climate Corporate Data Accountability Act): Signed into law in October 2023, SB 253 requires companies with over $1 billion in annual revenue doing business in California to publicly disclose Scope 1, 2, and 3 emissions beginning in 2026 (Scope 1 and 2) and 2027 (Scope 3). This applies to both public and private companies — a significant expansion beyond the SEC rule. Legal challenges are ongoing, but the law remains in effect.

California SB 261 (Climate-Related Financial Risk Act): Companion to SB 253, this law requires companies with over $500 million in annual revenue doing business in California to disclose climate-related financial risks on a biannual basis. The original January 1, 2026 reporting deadline is no longer in effect — enforcement was halted by a Ninth Circuit injunction in November 2025, following a First Amendment challenge brought by the US Chamber of Commerce. Reporting is currently voluntary; CARB will set a new deadline once the appeal is resolved.

New York Climate Corporate Accountability Act: New York has proposed legislation closely mirroring California's SB 253, which would require companies with over $1 billion in revenue doing business in New York to report Scope 1, 2, and 3 emissions. As of early 2026, the bill is advancing through the legislature but has not yet been signed into law.

IRS Sections 45Q and 45V: These tax credit provisions under the Inflation Reduction Act incentivize carbon capture and clean hydrogen production respectively — both of which require life cycle emissions data to qualify. LCA is effectively embedded in the compliance requirements for companies pursuing these credits.

State-Level Extended Producer Responsibility (EPR) Laws:  Seven US states — Oregon, Colorado, California, Maine, Minnesota, Maryland, and Washington — have enacted packaging EPR laws requiring producers to take financial and operational responsibility for end-of-life management of their packaging. Reporting deadlines range from 2025 to 2029. EPR programs increasingly require product-level environmental data — including material composition and recyclability — making LCA a relevant input for compliance. The LCA reporting requirement for the largest producers begins this year.

European Union (EU)

The EU has the most developed and far-reaching sustainability reporting framework in the world, and it directly affects non-EU companies that operate or sell in European markets.

Corporate Sustainability Reporting Directive (CSRD): The EU's mandatory sustainability reporting framework was significantly revised in February 2026. Wave 1 (large public-interest entities, 500+ employees) continues unchanged, reporting FY 2024 data. Wave 2 (large unlisted companies) receives a two-year delay, now reporting FY 2027 data (due 2028). Wave 3 (listed SMEs) is fully exempted. The Omnibus I revision raised mandatory reporting thresholds to 1,000+ employees AND €450M+ annual turnover, removing approximately 80% of previously obligated companies. Non-EU companies with €450M+ in EU revenue remain subject to CSRD. Reporting standards are being simplified, with mandatory data points reduced by ~61%, and materiality assessments no longer required annually.

Corporate Sustainability Due Diligence Directive (CS3D): The EU's mandatory due diligence framework (adopted July 2024) requires companies to identify, prevent, and mitigate adverse environmental and human rights impacts across their full value chain—including operations, subsidiaries, and both upstream and downstream business partners. Companies must develop and implement climate transition plans, and face potential civil liability for non-compliance. This directive shifts accountability beyond your own operations to the entire ecosystem you operate within.

Taxonomy Regulation: The EU Taxonomy is a classification system that defines which economic activities can be considered environmentally sustainable, strategically supporting the EU Green Deal goals — which include achieving climate neutrality by 2050, reducing emissions by at least 55% by 2030, and protecting natural ecosystems. Companies subject to CSRD must disclose the extent to which their activities are taxonomy-aligned — requiring detailed environmental performance data on revenue, operating expenses, and capital expenditures aligned with sustainability criteria.

Carbon Border Adjustment Mechanism (CBAM): CBAM imposes a carbon cost on imports of certain carbon-intensive goods (steel, cement, aluminum, fertilizers, electricity, and hydrogen) into the EU. Importers must report the embedded emissions — the carbon generated during the production of these goods — and purchase CBAM certificates annually. The transitional phase (2023–2025) allowed reporting without certificate purchases; the definitive period (2026 onwards) requires mandatory certificate purchases based on quarterly (2026) and weekly (2027+) EU ETS allowance prices.

EU Green Claims Directive (Proposed): This proposed directive would require companies making environmental claims (e.g., 'carbon neutral,' 'eco-friendly') to substantiate those claims with third-party verified data using robust, science-based methods. The directive targets explicit voluntary claims about products' environmental performance and requires independent verification by accredited verifiers. Proposed in March 2023, the directive remains in legislative process but signals a significant shift in how product-level environmental claims will be regulated across Europe.

Canada

Canadian Securities Administrators (CSA) Climate Disclosure: Canada’s securities regulators formally paused their work on mandatory climate-related disclosure rules in April 2025, citing global regulatory uncertainty and competitiveness concerns for Canadian issuers. The pause follows the U.S. Securities and Exchange Commission (SEC)’s withdrawal of its own climate disclosure rules and the EU’s Omnibus revisions. The CSA has indicated it will monitor international developments and revisit mandatory requirements in future years. In the meantime, the Canadian Sustainability Standards Board’s (CSSB) voluntary CSDS standards provide a disclosure framework aligned with ISSB.

Clean Fuel Regulations: Canada's Clean Fuel Regulations, effective 2022, require fuel suppliers to reduce the life cycle carbon intensity of gasoline and diesel annually through 2030. To demonstrate compliance, suppliers must use Canada's mandated Fuel Life Cycle Assessment (LCA) Model to calculate the carbon intensity of their fuel pathways — a requirement that applies to both fossil fuels and alternative fuels like biofuels and hydrogen. Suppliers meeting reduction targets generate compliance credits; alternative fuels can also generate credits by demonstrating lower life cycle carbon intensity than fossil fuel baselines. EarthShift Global contributed to developing the Government of Canada's Fuel LCA Model and its baseline emissions data, making the regulation one of the most prominent applications of LCA in North American policy.

Mexico

General Law for the Circular Economy: Mexico enacted its General Law for the Circular Economy earlier this year, establishing a national framework for transitioning to a circular economy model. The law introduces extended producer responsibility and, for designated sectors or product categories, requires product?level life?cycle analysis — including LCA or simplified life?cycle studies. It represents one of the most significant LCA?mandating regulatory developments in Latin America.

Asia

Across Asia, regulatory momentum for sustainability disclosure and carbon-related reporting is accelerating rapidly. Although national frameworks differ substantially in scope and implementation, the broader regional trend is toward more mandatory and increasingly internationally aligned disclosure regimes.

Japan — GX Promotion Law and Mandatory ETS: Japan's Green Transformation (GX) Promotion Law, enacted in 2023, establishes a national framework for decarbonization. Japan’s mandatory GX Emissions Trading Scheme (GX-ETS) enters its compliance phase on April 1, 2026, requiring large emitters (approximately 300–400 companies emitting more than 100,000 tons of CO2 annually) to participate in emissions reporting and compliance obligations. Separately, Prime Market-listed companies on the Tokyo Stock Exchange are expected to disclose climate-related risks and opportunities in line with TCFD recommendations. Together, these measures significantly strengthen Japan’s climate disclosure and carbon-pricing framework.

South Korea — Mandatory ESG Disclosure Roadmap: South Korea's Financial Services Commission (FSC) has proposed a phased mandatory ESG disclosure roadmap for KOSPI-listed companies. Under the current roadmap, mandatory disclosure is expected to begin in 2028 for the largest listed firms and expand gradually thereafter. The framework is aligned with ISSB-based Korean sustainability disclosure standards (KSSB) and includes Scope 1 and 2 emissions, with Scope 3 reporting to be phased in after a transition period. As of 2026, the FSC continues to expand its climate finance and green transition support programs..

China — CSRC Mandatory ESG Disclosure: China’s major stock exchanges, under the guidance of the China Securities Regulatory Commission (CSRC), issued mandatory sustainability disclosure guidelines in 2024 for selected listed companies on the Shanghai, Shenzhen, and Beijing stock exchanges. Mandatory reporting began for 2025 reporting periods and covers environmental, social, and governance topics. In parallel, China released its first national Corporate Sustainability Disclosure Basic Standard framework addressing governance, strategy, risk and opportunity management, and metrics and targets, including material climate-related impacts. Although the framework is domestically developed, it increasingly references international standards such as ISSB.

Singapore — SGX Mandatory Climate Reporting: Singapore Exchange (SGX)-listed companies have been subject to phased mandatory climate-related disclosure requirements since 2022, initially targeting selected sectors and progressively expanding by market capitalization. The framework was originally aligned with TCFD recommendations and is increasingly harmonized with the ISSB IFRS S2 standards, which require disclosure of Scope 1 and 2 emissions. Scope 3 disclosures are being phased in for larger issuers. External assurance requirements are also being introduced gradually, with implementation timelines extending into the early 2030s. Singapore is positioning itself as a regional hub for sustainable finance, and its disclosure framework reflects that ambition.

India — SEBI BRSR: India’s Securities and Exchange Board of India (SEBI) introduced the Business Responsibility and Sustainability Reporting (BRSR) framework, which became mandatory for the top 1,000 listed companies by market capitalization beginning in FY2022–23. BRSR covers environmental, social, and governance disclosures based on the nine principles of the National Guidelines on Responsible Business Conduct (NGBRC). SEBI subsequently introduced “BRSR Core,” a subset of quantitative indicators including greenhouse gas emissions and energy consumption. Under the framework, essential indicators are mandatory while leadership indicators remain voluntary. Assurance requirements for the BRSR Core began in 2023, with a phased implementation for the largest listed entities.

Australia and New Zealand

Australia — Mandatory Climate Disclosure Law: Australia passed landmark mandatory climate disclosure legislation in 2024, making it one of the first countries in the Asia-Pacific region to legislate ISSB-aligned disclosure requirements. Large companies and financial institutions are required to report beginning in 2025, with smaller companies phasing in through 2027. Requirements include Scope 1, 2, and 3 emissions and climate scenario analysis — and are subject to third-party assurance.

New Zealand — External Reporting Board (XRB) Climate Standards: New Zealand introduced mandatory climate-related disclosures for large listed companies, large insurers, banks, and investment managers beginning in 2023 — making it one of the earliest adopters of mandatory TCFD-aligned reporting globally. The framework is administered by the External Reporting Board and requires Scope 1, 2, and 3 disclosure and scenario analysis.

Middle East

UAE — Mandatory Climate Disclosure and ISSB Alignment: The United Arab Emirates is implementing mandatory sustainability reporting aligned with international standards. From May 2025, companies subject to Federal Decree-Law No. 11 must disclose climate-related risks and Scope 1–3 greenhouse gas emissions, with non-compliance penalties ranging from AED 50,000 to AED 2 million. The Abu Dhabi Securities Exchange (ADX) and Dubai Financial Market (DFM) require listed companies to publish annual ESG reports aligned with GRI standards and 31 core ESG indicators. Following COP28 (hosted in Abu Dhabi in 2023), the UAE significantly raised its climate ambitions. Regulators have signaled that requirements will move toward mandatory, standardized disclosure aligned with ISSB (IFRS S1 and S2) in the near term. The UAE Net Zero by 2050 strategic initiative is accelerating this trajectory, positioning the UAE as a leader in mandatory climate reporting across the Middle East.

Saudi Arabia — CMA Sustainability Reporting and Vision 2030: Saudi Arabia's Capital Market Authority (CMA) requires listed companies to disclose ESG information as part of annual reporting. Requirements are currently principles-based rather than prescriptive. However, Saudi Arabia's Vision 2030 framework and its net-zero by 2060 commitment are driving increasing formalization of sustainability disclosure expectations for large companies and state-owned enterprises. The CMA and Tadawul (Saudi Arabia's stock exchange) encourage alignment with ISSB and TCFD standards, though mandatory adoption timelines have not yet been formalized. Saudi Arabia is expected to move toward mandatory ISSB-aligned reporting in the coming years as regional frameworks mature.

Africa

Across Africa, sustainability disclosure is moving from guidance to expectation. While South Africa remains the most advanced market, we are seeing real momentum in countries like Nigeria and Kenya, where regulators and exchanges are laying the groundwork for more formal requirements. For companies operating in the region, in as much as they are voluntary commitments this is the time to build internal capacity, particularly around climate risk and life cycle data before these frameworks become mandatory.

South Africa — JSE Sustainability Disclosure Guidance: South Africa's Johannesburg Stock Exchange (JSE) has developed one of Africa's most comprehensive sustainability reporting frameworks. The JSE launched voluntary Sustainability Disclosure Guidance in June 2022, aligned with TCFD and ISSB standards (IFRS S1 & S2). While currently voluntary, several South African regulatory bodies — including the Prudential Authority, Financial Sector Conduct Authority, and Department of Trade, Industry and Competition — are actively considering mandatory sustainability reporting frameworks. South Africa is also working toward ISSB jurisdictional adoption, signaling a trajectory toward more formalized disclosure requirements.

Nigeria and Kenya — Nigeria's NGX and Kenya's CMA have issued voluntary ESG disclosure guidelines as their respective markets lay groundwork for potential future mandatory requirements. For companies operating across Africa, this transition period is an ideal time to build internal capacity around climate risk and life cycle data before these frameworks formalize.

Navigating Your Obligations

The regulatory landscape is complex and changing rapidly. Use the interactive tool above to see which regulations apply to your company based on size, revenue, and location — but keep in mind that compliance requirements depend on your specific operations, business model, and supply chain. 

Regulatory Compliance Matrix

Important: Regulatory requirements vary significantly by region and jurisdiction. The regulations shown above represent potential obligations for companies at this size and revenue level. Your actual compliance obligations depend on where you operate, where you sell products, and where your supply chain extends. Some regulations apply globally, while others are region-specific. Consult with legal counsel to determine which regulations apply to your specific business.

Abbreviations: CSRD = Corporate Sustainability Reporting Directive (EU) | CS3D = Corporate Sustainability Due Diligence Directive (EU) | GX-ETS = Japan Green Transformation Emissions Trading Scheme | SK = South Korea | CBAM = Carbon Border Adjustment Mechanism (EU) | UAE = United Arab Emirates

This overview reflects the most significant frameworks as of May 2026. Requirements, deadlines, and jurisdictional scope change frequently, and some regulations (like those marked "Proposed") may still be in legislative process.

For an official assessment tailored to your business, we recommend connecting with our team. Book a free 30-minute consultation to discuss your sustainability reporting obligations and develop a compliance roadmap specific to your organization. We'll help you understand not just which rules apply, but how to build the LCA foundation to meet them efficiently.

Sources:

Multiple Regions

Hogan Lovells. (2025). Navigating Conflicting ESG Regimes: A Playbook for Cutting Through Cross-Border Complexity. Retrieved from https://www.hoganlovells.com/-/media/hogan-lovells/global/knowledge/topic-centers/esg/bt-req-4071-interactive-esg-playbook---navigating-conflicting-regimes-v1-bh-v5.pdf

United States

Harvard Law School Forum on Corporate Governance. (2025, September 30). "Regulatory Climate Shift: Updates on the SEC Climate-Related Disclosure Rules." https://corpgov.law.harvard.edu/2025/09/30/regulatory-climate-shift-updates-on-the-sec-climate-related-disclosure-rules/

Nixon Peabody LLP. (2026, March 2). "California Climate Disclosure Laws Update." https://www.nixonpeabody.com/insights/alerts/2026/03/02/california-climate-disclosure-laws-update

New York State Senate. "Climate Corporate Data Accountability Act (S3456)." https://www.nysenate.gov/legislation/bills/2023/S3456

EarthShift Global. "Section 45Q Life Cycle Assessment Services." https://earthshiftglobal.com/section-45q

Adams and Reese LLP. "Selected State Packaging EPR Milestones and Effective Dates." https://www.adamsandreese.com/hubfs/Client-Alert-PDFs/Selected%20State%20Packaging%20EPR%20Milestones%20and%20Effective%20Dates.pdf?hsLang=en

European Union

Greenstep. (2026, March). "CSRD and Omnibus – What Changed and What It Means for Companies in 2026." https://greenstep.com/articles/csrd-and-omnibus-what-changes-2026/

European Commission. "EU Taxonomy for Sustainable Activities." https://finance.ec.europa.eu/sustainable-finance/tools-and-standards/eu-taxonomy-sustainable-activities_en

European Commission. "Carbon Border Adjustment Mechanism (CBAM)." https://taxation-customs.ec.europa.eu/carbon-border-adjustment-mechanism_en

European Commission. "Green Claims Directive." https://environment.ec.europa.eu/topics/circular-economy/green-claims_en

Canada

Canadian Securities Administrators. (2025, April 23). "CSA Updates Market on Approach to Climate-Related and Diversity-Related Disclosure Projects." https://www.securities-administrators.ca/news/csa-updates-market-on-approach-to-climate-related-and-diversity-related-disclosure-projects/

EarthShift Global. "Navigating Canada's Clean Fuel Regulations." https://earthshiftglobal.com/navigating-canadas-clean-fuel-regulations

Mexico

Mexico Business News. (2026, January 22). "Mexico Enacts General Law for the Circular Economy." https://mexicobusiness.news/sustainability/news/mexico-enacts-general-law-circular-economy

Asia

AMT Law. (2026, January 23). "Recent Developments in Japanese/Global Climate Change/Carbon Credit Regulations." https://www.amt-law.com/asset/pdf/bulletins12_pdf/260123_en.pdf

South Korea Financial Services Commission. "ESG Disclosure Roadmap." https://www.fsc.go.kr/eng/

QIMA. (2026, January 4). "ESG Reporting in 2025 & 2026: What Changed and What It Means for Companies." https://blog.qima.com/sustainability/esg-reporting-2025-2026

Singapore Exchange (SGX). "Sustainability Reporting Framework." https://www.sgx.com/sustainable-finance/sustainability-reporting

Securities and Exchange Board of India (SEBI). (2021, May 10). "Business Responsibility and Sustainability Reporting (BRSR) Circular." https://www.sebi.gov.in/legal/circulars/may-2021/business-responsibility-and-sustainability-reporting-by-listed-entities_50096.html

Australia & New Zealand

Australian Government Department of Finance. "Commonwealth Climate Disclosure." https://www.finance.gov.au/government/climate-action-government-operations/commonwealth-climate-disclosure

External Reporting Board (XRB). "Aotearoa New Zealand Climate Standards." https://www.xrb.govt.nz/standards/climate-related-disclosures/

Middle East

Abu Dhabi Securities Exchange (ADX). "ESG Disclosure Guidance for Listed Companies." https://www.adx.ae/-/media/adx/related-documents/sustainability/esg-disclosure-guidance-for-listed-companies---english.pdf

Anthesis Global. (2025). "Mandatory Sustainability Reporting in the Middle East: ISSB Standards and Climate Disclosure." https://www.anthesisgroup.com/me/insights/mandatory-sustainability-reporting-in-the-middle-east/

Saudi Arabia Capital Market Authority (CMA). "ESG Guide." https://cma.org.sa/en/Market/Documents/ESGGuide.pdf

Africa

Johannesburg Stock Exchange (JSE). "Sustainability Disclosure Guidance." https://group.jse.co.za/sustainability/climate-disclosure-guidance

Nigerian Exchange Group. "Sustainability Disclosure Guidelines." https://ngxgroup.com/ngx-download/sustainability-disclosure-guidelines/