The European Commission (EC) has released a set of frequently asked questions (FAQs) to aid in the implementation of the Corporate Sustainability Reporting Directive (CSRD). These FAQs aim to clarify various aspects of the CSRD and the first set of the European Sustainability Reporting Standards (ESRSs), ensuring stakeholders can comply with regulatory requirements effectively.

In a recent survey by PwC, 4,700 CEOs shared their insights on how climate action can drive business value. Despite the challenges, many CEOs are finding that addressing climate-related opportunities and risks can lead to better financial performance.

The International Accounting Standards Board (IASB) has recently published a consultation document aimed at helping companies improve their reporting on climate-related risks and other uncertainties. This initiative responds to growing investor demand for clearer and more consistent climate-related information in financial statements.

As part of their “Jet Zero” strategy to achieve net-zero emissions in aviation by 2050, the UK government has mandated that 2% of jet fuel must come from sustainable aviation fuel by 2025. With the new mandate, the government hopes to significantly reduce greenhouse gas emissions and support economic growth.

Earlier this year SBTi caused controversy by suggesting they would allow the use of Environmental Attribute Certificates to scope 3 emissions. In new publications by the organization, there are suggestions that this move is being reversed. The implications of this will be the need for new and clearer guidance by SBTi on the use of carbon credits and for companies whom were earlier relying on the use of credits to achieve reduction targets to rethink this.

According to PwC’s Global CSRD Survey 2024, Dutch companies are leading in readiness and confidence for implementing the new Corporate Sustainability Reporting Directive (CSRD). An impressive 79% of Dutch businesses expect to comply with the CSRD on time, significantly surpassing the global average of 63%. This optimism is fueled by progress made in CSRD implementation, even as challenges related to data quality, value chain complexity, and human resources persist

The European Securities and Markets Authority (ESMA) has issued a Public Statement urging companies to prepare for the new Corporate Sustainability Reporting Directive (CSRD) requirements. The CSRD expands sustainability reporting obligations for over 50,000 companies, emphasizing governance arrangements, materiality assessments, and data collection systems. ESMA highlights the importance of readiness to meet detailed reporting standards and conduct double materiality assessments.

In the ever-evolving landscape of Mergers & Acquisitions (M&A), environmental, social, and governance (ESG) factors are gaining prominence. Deloitte’s 2024 M&A Trends Survey reveals that successful dealmakers embrace uncertainty, prioritize value creation, and bridge gaps between private equity and corporate approaches. By understanding and leveraging ESG considerations, companies can navigate the changing M&A landscape effectively.

The European Commission has launched the Climate City Capital Hub to provide financial support and advice to cities aiming for climate neutrality. With a €650 billion investment target, this initiative will leverage public and private capital, supported by the European Investment Bank (EIB). A group of 112 cities committed to eliminating their net greenhouse gas emissions by 2030 will require a combined €650 billion in investments to fulfill this pledge, according to a European Union initiative.

Australia is implementing strict ESG labeling requirements to combat greenwashing and promote transparency in sustainable investments. The regulations also include climate disclosure guidelines for large businesses and financial institutions. By 2027, Australia aims to create a robust ESG framework that aligns with global standards and fosters responsible capital flow. These measures reflect Australia’s commitment to authentic ESG practices and investor protection, positioning the country as a responsible financial hub in the APAC region.

The recent European Union (EU) parliamentary elections have caused ripples in the sustainable investing world. With a notable shift towards right-wing and nationalist parties, the future of the EU’s ambitious sustainable agenda is now uncertain. The 2019 EU elections were dubbed a “green wave,” but this time, the Greens suffered losses, reflecting voter disenchantment with the perceived costs of the green transition. Populist parties are skeptical of the EU’s climate agenda, potentially affecting policies like the 2035 ban on new petrol and diesel cars. The fate of the EU’s Green Deal hangs in the balance, as right-wing parties gain influence in the European Parliament.

China’s Ministry of Finance is taking significant steps toward unifying corporate sustainability disclosures. They’ve released a draft guideline with the vision of establishing a nationwide standard by 2030. This move responds to the global focus on Environmental, Social, and Governance (ESG) issues, making enhanced corporate sustainability reporting essential. The guidelines aim to improve companies’ engagement in global trade, enhance international competitiveness, and support China’s institutional opening-up.

The European Council has approved the Corporate Sustainability Due Diligence Directive (CSDDD), overcoming earlier setbacks and revisions to mandate large companies to address their adverse impacts on human rights and the environment within their supply chains. Proposed by the European Commission in 2022, the directive aims to tackle issues like child labor, pollution, and deforestation while aligning businesses with the Paris Agreement's climate goals. Despite initial concerns from member states like Germany and Italy, the revised CSDDD, approved in March, reduces the number of affected companies by raising thresholds and implements a phased approach for compliance, starting with larger corporations in 2027 and extending to others by 2029. Though some provisions, such as financial incentives for climate transition plans, were removed, the directive stands as a significant measure in promoting corporate responsibility and sustainability within the EU.

Achieving net-zero emissions by 2050 is still feasible but will require an additional $34 trillion investment in clean energy, representing a 19% increase over current projections, according to BloombergNEF. The report highlights the urgent need for enhanced support in sectors like electric vehicles, renewable energy, power grids, and carbon capture, amidst political resistance and economic challenges. Significant investments, particularly $1 trillion annually by the 2040s for infrastructure, are crucial to prevent severe economic damages from climate change, which could cost up to $59 trillion annually by 2050.

In the realm of European politics, the spotlight is firmly on high energy prices and ambitious energy transition objectives. As the European Parliament elections approach, a projected shift to the right has ignited intense discussions about EU climate policy. Right-leaning Members of the European Parliament are advocating for a more measured approach to the Green Deal, citing concerns about the proposed 2040 targets in context with voters’ cost-of-living worries.

The 2024 Gen Z and Millennial Survey by Deloitte highlights that climate change and environmental sustainability significantly influence both workplace and consumer behaviors among Gen Z and millennials. With over 22,800 respondents from 44 countries, the survey found that more than 40% have left or plan to leave jobs due to climate concerns, nearly two-thirds are willing to pay more for sustainable products, and many reject work assignments conflicting with their environmental values. Additionally, these generations increasingly research companies' environmental policies before job acceptance and purchasing decisions, with substantial percentages avoiding fast fashion, reducing air travel, adopting plant-based diets, and purchasing or planning to purchase electric vehicles, reflecting their strong commitment to sustainability.

Research indicates that clearer and stricter domestic green policies could redirect up to £100 billion in global investments to the UK. However, recent government actions, including weakening key net zero commitments, have led many investors to consider moving their funds to more supportive markets like the US, EU, and China. While 83% of financial service organizations still see the UK as a top market, two-thirds are contemplating or have already shifted investments elsewhere. UKSIF calls for mandatory climate risk disclosures and other regulatory enhancements to reestablish the UK's leadership in sustainable finance and attract the necessary private capital for achieving net zero goals.

The article highlights the significant shortfall between current national proposals and the necessary carbon dioxide removal (CDR) levels to achieve Paris Agreement targets. Despite countries committing to net-zero goals, the study identifies a notable "CDR gap," emphasizing the urgent need for enhanced emissions reduction ambitions and innovative policies to bridge the disparity and effectively combat climate change.

The IFRS Foundation and EFRAG have released guidance to simplify sustainability reporting alignment between ISSB and ESRS standards, easing the burden on EU companies. The document focuses on climate-related disclosures, providing practical support for applying ISSB's standards alongside ESRSs. Despite differing approaches, the guidance aims to ensure consistency in reporting requirements and reduce duplication in sustainability disclosures.