Learn about the ESG regulations most relevant to your company

Five simple steps to prepare for the ESRS, the framework for sustainability reporting under the CSRD.

The SDR is a comprehensive regulatory framework that mandates companies and financial institutions to disclose their impacts, both positive and negative, on the environment and society.

The CBAM is an environmental policy designed to apply the same carbon costs to imported products as would be incurred by installations operating in the EU.

The SFDR is a European regulation standardising ESG disclosures in finance. It aims to increase transparency and prevent greenwashing. Implemented in 2021, it ensures consistent sustainability reporting and supports informed investment decisions.

The Corporate Sustainability Due Diligence Directive (CSDDD) introduced by the European Union mandates companies to identify, mitigate, and report on the impact of their operations and supply chains on human rights and the environment. This mandatory legislation, set to take effect by 2025 or 2026, applies to both EU and non-EU companies operating in the EU and mainly targets those in high-risk industries.

The US Federal Supplier Climate Risks and Resilience Rule enhances the climate resilience of federal supply chains. Suppliers must assess, disclose, and mitigate climate-related risks to their operations, products, and services.

On 6 March 2024, the United States Securities and Exchange Commission (SEC) adopted the final rules, first proposed in March 2022, mandating climate-related disclosures. These aim to enhance transparency by requiring SEC registrants to include climate-related information in their registration statements and periodic reports.

The UK Disclosure Framework for Net Zero Transition Plans is a voluntary framework that companies can use to report on their transition to net-zero emissions and support the transition to a low-carbon economy.

The Streamlined Energy and Carbon Reporting (SECR) is a UK regulation that requires companies in scope to report on their emissions and energy consumption.

In January 2024, the NFRD was officially replaced by the Corporate Sustainability Reporting Directive (CSRD). The CSRD has broadened the scope and the reporting requirements of the NFRD. 

The TCFD Task Force has been officially disbanded and will be replaced with the Sustainability Disclosure Standards (SDS) in July 2024, with some changes to GHG reporting.TCFD was created by the international Financial Stability Board (FSB) to develop consistent climate-related financial risk disclosures for companies, banks, and investors to provide information to stakeholders.

The European Union's Fit for 55 package aims to reduce greenhouse gas emissions by 55% by 2030. The “Fit for 55” package was formally adopted in October 2023, and its implementation has begun in Member States.

The European Climate Law writes into law the goal set out in the European Green Deal for Europe’s economy and society to become climate-neutral by 2050. The law also sets the intermediate target of reducing net greenhouse gas emissions by at least 55% by 2030, compared to 1990.

CDP is a not-for-profit organisation established in 2000 that runs the global environmental disclosure system for companies, cities, and governments. CDP has created an international standard for reporting on climate change, water, forests, and plastics.

The EU Taxonomy is a classification that sets criteria to determine whether an economic activity significantly contributes to the six environmental objectives defined in the regulation. It is a tool to help companies and investors make sustainable investment decisions. EU Taxonomy disclosures must be made as part of the NFRD/CSRD and SFDR reporting requirements.

The CSRD is an EU Directive that amends the scope and the reporting requirements of the Non-Financial Reporting Directive (NFRD). While the NFRD only provided guidelines for ESG reporting, the CSRD will introduce mandatory reporting standards.

Sustainable finance in the EU is understood as finance that supports economic growth while considering Environmental, Social and Governance (ESG) fundamentals. On 6 July 2021, the European Commission adopted several measures to increase its ambition in sustainable finance.

In May 2024, the German Bundesrat (Federal Council) approved the new German Protection Act (Bundes-Klimaschutzgesetz), which aims to ensure that Germany reaches its goals of a 65% emission reduction by 2030, 88% by 2040 and climate neutrality by 2045.