What’s in this week’s newsletter:

1. California and Europe clarify reporting rules

2. GHG Protocol and ISO unite carbon standards

3. Europe’s climate risks intensify

4. Backlash against AI data centers grows

5. Singapore expands ISSB reporting

After years of delays, revisions, and uncertainty, companies finally have greater clarity on two of the major sustainability reporting regimes: California’s emission reporting rule (SB 253) and Europe’s Corporate Sustainability Reporting Directive (CSRD).

Soon after its public workshop last Tuesday, the California Air Resources Board (CARB) released its updated rule for 2026 emissions reporting.

While there are no wholesale changes to the policy, there are a few modifications in the updated text that companies should be aware of:

• The new compliance deadline of November 10th was added along with the new December 10th date for determining the annual fee.

• CARB added its 2024 Enforcement Notice to the rule as guidance on acceptable 2026 submissions.

• Additional clarity was added on consolidated reporting for parent companies and subsidiaries, on what constitutes “doing business in California,” and clearer definitions of terms.

• To align with the original draft rule, some interstate wholesale electricity transactions are now excluded from California sales calculations.

Also, last week the European Financial Reporting Advisory Group (EFRAG) released an exposure draft of its Sustainability Reporting Standards (ESRS) for non-EU companies. US companies make up the largest contingent of that group. EFRAG estimates that at most 450 US companies will be affected. The new standards for non-European companies are similar to the ESRS (Set 2), but there are a few important differences:

• The ESRS for non-EU companies focuses only on impact and does not require companies to report their financial risks and opportunities. This decision is based on the assumption that these companies report financially material information in their home countries.

• Also, these non-EU companies can choose to report on their impacts in just Europe or report on their global impacts.

The public consultation closes on October 31st, and a list of data points will be released ahead of the reporting deadline in 2029.

2. GHG Protocol and ISO Combine Standards

This week, my employer, the GHG Protocol (GHGP), announced consolidation of its corporate carbon accounting standards used by 97% of the S&P 500, and integration with the ISO carbon accounting standards. The aim is to create a global common language for carbon accounting. The announcement covered three topics:

• GHGP and the International Organization for Standardization (ISO) will combine their corporate carbon accounting standards into a single co-branded, harmonized, global accounting standard. Planned to be released with a joint public consultation in Q2 2027, the consolidated standard will bring together GHGP’s Scope 1, 2, and 3 standards and Actions and Market Instruments (AMI) standards with ISO’s 14064-1 standard to form a more integrated, efficient standard.

• GHGP is publishing a summary of more than 1,100 responses from its Scope 2 public consultation, which included a diversity of views focused mainly on how companies should account for renewable energy purchases.

• GHGP also released preliminary feedback from the Request for Information on its Actions and Market Instruments (AMI) standard. The AMI standard proposes a multi-statement approach allowing companies to share three complementary views of their emissions: their physical emissions, emissions associated with market-based instruments, and the real-world emissions impact of their actions and investments.

In an interview in Sustainable Views on Wednesday, I said, “The future starts here with this globalized, common language for carbon accounting.”

3. Europe Faces More Climate Risks

NASA satellite imagery of the Bordeaux fire from July 24th

Europe is the fastest-warming continent and one of the frontlines of climate risks. This summer, those climate risks have hit hard. Following record-breaking temperatures that contributed to more than 10,000 excess deaths, wildfires now ravage France, Spain, and even Scotland.

As of this writing, fires are still burning close to major population centers in Bordeaux and Madrid. Around a quarter of a million people have been evacuated thus far. In France, a rare fire thunderstorm occurred, known as pyrocumulonimbus, when fires burn so intensely they create their own weather systems. Another heatwave is predicted in the coming week, and French President Emanuel Macron warned: “The weeks ahead will be hard.” Spain’s President Pedro Sanchez blamed climate change, saying, “We need to be more vigilant and better prepared every year for a climate emergency that is, unfortunately, surpassing every level that scientists have been systematically warning us about for many years.”

In related news, the European Central Bank (ECB) this week announced it will expand its climate factor to corporate loans. This means that corporate loans using ECB funding that have higher climate transition risks will return less to European banks. Inevitably, this will force banks to ask for climate data from their customers and will help protect Europe from the financial impacts of climate risks.

4. AI Data Center Backlash Accelerates

With energy prices increasing as a result of increased data center usage, US President Donald Trump announced a new voluntary pledge from more than 200 tech companies and power producers to invest in energy infrastructure to protect consumers from price hikes. However, skeptics claim it is unlikely to result in lower energy bills. Jesse Lee, from Climate Power, called the agreement nothing more than a “pinky promise,” adding that “instead of allowing affordable, scalable clean energy onto the grid, Trump has actively pressured tech companies to power their data centers with fossil fuels.”

Earlier this month, New York became the first state to issue a moratorium on new data centers. And it looks like data centers will be a flashpoint in the upcoming US midterms, as other states are considering joining the moratorium. Illinois, where Governor JB Pritzker signed a bill incentivizing data center infrastructure build-out in 2019, has now done a full 180. Pritzker now wants to disincentivize the data center build-out, but has stopped short of proposing a moratorium.

However, as the backlash deepens, a day of protest against data centers generated 142 separate protests across 42 states last week. There are now more than 200 active moratorium proposals across counties and states, double the amount from just three months ago. You can track them here.

5. Singapore Expands ISSB-aligned Reporting

Back in 2023, Singapore became the first jurisdiction to release a mandatory climate reporting rule aligned with the International Sustainability Standards Board (ISSB) Standards. Singaporean public companies have been reporting Scope 1 and 2 emissions since 2025, with the 20 largest public companies on the Straits Times Index (STI) reporting additional climate data.

The newly drafted Singapore Sustainability Disclosure Standards mandate public companies that are not on the index to report additional climate data from 2028. Large private companies will have to report Scope 1 and 2 starting in 2030, and limited assurance will be phased in from 2029. Scope 3 will remain voluntary for private and smaller public companies. Companies listed on the index will begin Scope 3 reporting this year.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.

Other Notable News:

EU Sustainability

• As part of an update to Europe’s Emissions Trading System, waste incinerators will have to start paying for their emissions. The move is to encourage more circular waste systems and investment in carbon capture.

Sustainability Reporting

• A new Deloitte report found that for the third year in a row, large UK companies have adjusted their previous year’s sustainability reports. The good news is that fewer are due to errors, and the majority come from improved methodologies or changing business structure.

CDP

• CDP launched a new AI tool to enable faster and simpler reporting to the framework. It provides suggested responses and has reduced disclosure preparation by 40%.

Climate Adaptation

• New York Mayor Zohran Mamdani announced $43 million to fund a new agency - the Bureau of Coastal Resilience - created to build 100 flood gates to protect Manhattan from flooding.

Renewables

• Off the back of the Iran War energy shock, investment in green energy through China’s Belt and Road Initiative reached record highs, with more investment in the first half of 2026 than in the whole of 2025.

• To combat China’s renewable tech dominance, European wind turbine manufacturers are considering mergers to create industry champions and to compete in the global market.

Global Weirding

• As we passed “Earth Overshoot Day” this week, this startling video shows just how much the climate has changed in the last half a century and the challenge that lies ahead of us.

Notable Podcasts:

• In this week’s edition of the Harvard Business Review’s The Climate Rising podcast, the hosts discuss how the energy transition can accelerate through communication. It features an interview with Leah Qusba, CEO of Good Power, a company using behavioral science, data, and campaigning to accelerate renewable energy adoption and counter misinformation.

• This week’s edition of the BBC’s The Climate Question asks: Do protests ever move the needle on climate action? The episode tracks protests from Greenpeace in the 1970s to today’s Just Stop Oil, finding that activism can have an impact.

What’s in this week’s newsletter:

1. California reveals its emissions reporting requirements

2. Why sustainability reporting makes business sense

3. Trump attacks wildfire preparedness

4. The EU retreats on emissions rules

5. Britain’s new prime minister forming a climate agenda

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The California Air Resources Board (CARB) held a workshop this week and confirmed that large companies doing business in California must report on their emissions starting November 10, 2026 (a slight delay from the original date of August 10).

The first reporting year will be flexible: Companies can submit their Scope 1 and 2 emissions (emissions from owned facilities and purchased energy, respectively) based on information they had in place at the time of a December 2024 enforcement notice. They will not be required to create or collect entirely new data solely to comply in 2026. 2027 is when the rubber really hits the road.

Under the California Air Resources Board’s (CARB) 2027 proposals, companies would be required to report their Scope 1 and 2 emissions and obtain limited third-party assurance under several assurance standards such as International Standard on Sustainability Assurance 5000 and ISO 14064-3:2019.

Scope 3 (emissions from the value-chain) reporting would also begin in 2027. Because these emissions usually represent the majority of a company’s footprint and are often the most difficult to calculate, commenters have raised significant challenges. To address these concerns, CARB proposed limiting Scope 3 reporting to the five of the most commonly reported categories (Purchased goods and services, Fuel- and energy-related activities, Waste generated in operations, Business travel, and Employee commuting). Companies could voluntarily report the other ten categories. However, CARB has not yet set a date for when, or whether, all 15 categories will become mandatory.

CARB said its objective was to align with the GHGP carbon accounting standards (my employer) wherever possible to ensure interoperability. CARB will require companies to disclose the methodologies used, organizational boundaries, missing data, and uncertainty. Companies would also have to explain if changes to their methods or data alter base-year emissions by more than 5%.

Interestingly, around a third of the nearly 30 questions during the workshop related to how CARB plans to apply the GHG Protocol. The main themes included how CARB will respond to future revisions of GHG Protocol standards, the treatment of biogenic emissions, Scope 2 accounting, and the flexibility companies will receive when calculating Scope 3 emissions.

CARB is proposing November 10 as the recurring annual reporting deadline from 2026 onward, although that date remains open to feedback. Further details about the submission process for the initial 2026 reports, including guidance and an optional online intake form, are expected by September 1st.

2. The Benefits of Sustainability Reporting

One thing CARB did in this most recent workshop above was talk extensively about the costs of climate reporting. While they acknowledged the costs can be high, especially in the first year, they also highlighted the measurable business benefits, including improved supply chain management, greater investor confidence, and higher-quality decision-making.

The evidence of the business benefits of reporting was also shared by the European Financial Reporting Advisory Group (EFRAG), which found in its 2026 State of Play Report that after two years of mandatory sustainability reporting in Europe, reports are becoming shorter, more integrated into business strategy, and increasingly linked to executive pay.

There is also a growing body of research suggesting the benefits are broad and impact a wide number of stakeholders. A recent Project ROI report found that companies that were more candid in their sustainability reports, sharing both wins and losses, benefited from higher stock prices. And a journal article released last month looking at how sustainability reporting through the International Sustainability Standards Board (ISSB) standards can improve financial analysis found that climate disclosures could be linked directly to financial data to help investors refine forecasts, assess risk, and improve company valuations.

3. Trump Targets Wildfires

As the smoke cleared from the Canadian wildfires, the Trump Administration accused Canada of improper wildfire and forestry management and threatened additional tariffs on top of the unrelated 50% tariff also lodged this week. While Trump blames Canada for the fires, a group of scientists from both countries blames climate change.

Trump’s Canada complaint comes as the US is struggling with its own wildfires in the Pacific Northwest. Recent funding cuts “mean there is likely to be less organized and strategic research to address threats from wildfire smoke,” said Bryan Hubbell of Resources for the Future

Trump also took time this week to criticize a climate education guide for judges from the National Academies of Sciences.

4. EU Weakens Emissions Rules Under Pressure

Pressure from the Trump Administration was partly behind Europe’s three-year pause in fines on energy companies that import methane-related fuels into the bloc. The methane rule would have begun applying from next year and would have meant fines of up to 20% of revenue for any company that cannot show they are monitoring, reporting, and mitigating methane leaks and flares.

Another reason the penalties were delayed was due to the Iran oil and gas shock. This was also the reason Europe is reforming its Emissions Trading System (ETS). Under the proposals released on Friday, allowances that permit heavy industries to continue emitting carbon will be extended nine years from 2039-2048, and some of the income Europe generates from the ETS will be returned to the companies to invest in cleaning up their operations.

European energy commissioner Dan Jørgensen also announced on Friday a goal to double the EU’s electrification rate to 46% by 2040. The Electrification Action Plan aims to lower the cost of electricity, improve grid connections, and reduce electricity-linked taxes to meet the goal, which would save member states €260 billion in fossil fuel imports per year

5. New UK PM Forming Climate Agenda

UK’s New Prime Minister Andy Burnham Enters 10 Downing Street

The United Kingdom brought in its sixth Prime Minister in 10 years this week. New PM Andy Burnham, the former Mayor of Manchester, takes over at a pivotal moment for climate action in the UK with rising energy costs, unprecedented heatwaves, and a growing distaste for net zero policies.

Given that climate is a political hot potato in the UK right now, Burnham has focused early policies on the cost of living and growth. As part of his growth manifesto, he said he planned to take a more “pragmatic approach” to drilling in the North Sea (much to the delight of US President Donald Trump). However, he has also pledged to bring utilities and elements of public transport back under public control, and his cabinet appointments indicate there will be a continuation of the energy transition and that climate diplomacy will be essential to foreign affairs.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.

Other Notable News:

Climate Risks

• Pension funds are trying to come to grips with what JP Morgan is calling “black swan climate risk events.” These are the more civilization-wide climate tipping points like the stopping of the Gulf Stream in the Atlantic Ocean.

Energy Transition

• US electric power emissions rose 4% last year, mainly driven by a 13% increase in coal use.

• Also in the US, the Energy Department has reversed 17 energy efficiency standards for household appliances.

Nature Positive:

• Dozens of corporate, non-governmental agencies, and governments signed the Kumamoto Declaration this week, a pledge to accelerate action to deliver the nature-positive goal of halting and reversing biodiversity loss by 2030 on a 2020 baseline.

Global Weirding

• A new analysis from a European grain trade association found that Europe’s June heatwave cost €2bn in the value of its grain crop.

• Another study on extreme heat’s impact on the economy in India found that it is costing the world’s most populous country 2% in GDP per year.

• Epidemiologists claim that the increased summer heat this year could be contributing to the spread of the Cyclospora outbreak and other diseases.

Greenwashing

• A new report from the Center for Climate Integrity has found that oil and gas companies have been downplaying their methane emissions for decades.

Notable Podcasts:

• I was featured this week on the Navigating Net Zero podcast with Alexia Kelly. Together we discussed the evolving landscape of carbon accounting, and why the shift is necessary as carbon reporting moves from a voluntary to mandatory exercise.

• The most recent edition of The Two Steps Forward episode with Joel Makower and Solitaire Townsend features an interview with climate scientist Katharine Hayhoe. The conversation focused on why hope beats doom in climate strategies.

• In this week’s edition of Bloomberg’s Zero the Climate Race podcast, host Akshat Rathi asks whether dropping net zero could help win the climate argument. He talks to Dale Vince, founder of Ecotricity, asking if the new UK Government will have to abandon net zero to reduce energy prices.

What’s in this week’s newsletter:

1. Europe finalizes the world’s first deforestation regulation

2. Should fossil fuel companies be held responsible for Scope 3 emissions?

3. Canadian wildfire smoke brings the US severe health implications

4. Inside Trump’s lobbying for more oil and gas production

5. Australia’s solar and battery boom is making electricity free

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Delayed for a year at the end of 2024, then for another year in 2025, Europe’s Deforestation Regulation (EUDR) has finally reached its final form and will be adopted on December 30th, 2026.

This week, the EU Commission released a Delegated Act, which sets out a simplified list of covered products, and an Implementing Act that will provide guidance for submitting due diligence and declarations.

The EUDR requires companies selling commodities such as coffee, palm oil, cocoa, cattle, rubber, soy, and wood into Europe to prove that their products did not cause deforestation after 2020. The simplified rule omits products such as leather, soybeans for sowing, retreaded tires, and other automotive products. It also adds new products, like soluble coffee, certain palm oil derivatives, and - strangely - “frozen cattle tongues”, and gives companies importing these newly added products an additional year (December 30th, 2027) to comply. It also provides exemptions for specific medicinal, packaging, and second-hand products in line with Europe’s competitiveness and circularity goals.

The finalization has been widely applauded after years of uncertainty, delays, and changes. This final edition provides companies that export and import these products with clarity on how to prepare. Béatrice Wedeux at the WWF said, “Despite continued efforts to weaken the EU Deforestation Regulation, this decision should mark the end of legal and political uncertainty around the EUDR.”

As is usually the case with European sustainability regulations, they become a template for other jurisdictions. For example, since Europe introduced the world’s first carbon border tariff, the Carbon Border Adjustment Mechanism (CBAM), in 2025, at least 11 other countries have begun developing similar measures.

The UK has become the first country to follow Europe’s lead by announcing its own deforestation rule last month at London Climate Week. The UK rule will broadly replicate the EUDR and be phased in from 2027.

2. Fuel Companies Found Responsible For Consumer Emissions

As excess deaths linked to the unprecedented heat across Europe and the US over the last two months continue to mount, the reverberations of a landmark ruling by a Paris Court against the French energy company TotalEnergies seem more pertinent than ever. The ruling requires TotalEnergies to identify and address its downstream emissions and publish a new climate risk and mitigation plan for its supply chain within six months. The Court will assess the plan’s adequacy in January 2027.

The implications of the ruling go far beyond TotalEnergies, as it was issued under France’s 2017 Duty of Vigilance Law, which requires certain large companies to identify, prevent, and mitigate serious human rights violations. Meaning other French and non-French oil and gas companies, as well as other companies, will be required to consider their downstream emissions under the Vigilance Rule. The French court’s decision could also serve as a precedent for other courts in Europe and beyond.

In a similar story, the first-ever US lawsuit holding oil and gas companies responsible for heat-related deaths in a 2021 Pacific Northwest heatwave will proceed toward trial. An Oregon county is seeking $50 billion in damages for damages in the same heatwave, claiming the leading US oil and gas companies are responsible for almost 70 deaths.

These lawsuits are part of a global trend to hold oil and gas companies responsible for the downstream pollution (Scope 3) created by their products. These cases are setting precedents similar to the massive payments for damages caused by the sale of tobacco and opioids that reshaped those sectors.

3. Canadian Wildfires Blot out the Sun

Pittsburgh’s skyline obscured by smoke today

Skies turned orange, and air pollution reached dangerous levels across cities in the Mid-Atlantic North America this week as wildfires burned in Ontario. Waking up this morning, I could barely see out of my own window in Pittsburgh (image above) as the sky was blotted out and a campfire smell hung in the air. The story was the same in cities from Detroit to Toronto and New York.

Residents were urged to stay indoors as air pollution levels reached dangerous levels, a result of more than 800 fires in Canada. Experts say the fires, which last peaked during the last El Niño in 2023, are exacerbated by a warming climate.

Studies have linked wildfire smoke with higher rates of heart attacks, strokes, and cardiac arrests, increases in emergency room visits for asthma, and weakened immune defenses. The poor air quality is expected to persist across the weekend and could potentially disrupt the New Jersey World Cup final.

4. The Trump Administration and Oil and Gas Companies

President Trump at an Oil and Gas Roundtable

A remarkable insight into the inner workings of the Trump Administration and its approach to the oil and gas sector came from a new book: “Regime Change: Inside the Imperial Presidency of Donald Trump.“

The New York Times reported that oil and gas company executives were invited to the White House and asked to increase exploration and extraction. Allegedly, Administration officials offered new Executive Orders to cut through any regulatory obstacles.

The reporting also alleged that oil and gas executives worked with the Justice Department to block Vermont and New York's ‘climate super fund’ policies - requiring oil and gas companies to pay for climate damages. The book detailed how the Administration increased tariffs on Europe to pressure it to reduce sustainability rules that apply to US-based firms.

This week, the Administration reduced the size of two Utah national monuments by 3 million acres, opening them to oil and gas and mineral exploration. They also ended decades of wildlife habitat protections under the Endangered Species Act, allowing oil and gas and other companies to develop on previously protected land. As always, the final word on these actions will be decided by US courts.

5. Free Energy?

Free energy may seem like a utopian dream, but Australia has made it possible - at least for part of the day. Australia has implemented the Solar Sharer Offer (SSO). SSO offers free energy to households with smart meters for three hours a day. Australians have been using those three hours to charge their domestic batteries, electric cars, and to do other energy-intensive tasks.

The program has ignited a battery boom. The country of just 28 million people added battery capacity equal to 10% of the world's total in March this year, and Australia is now the third-largest battery importer after the US and Germany.

With a glut of renewable energy from household solar and the influx of batteries, the cost of electricity fell 12% in Q1 2026, driving energy bills down across the country.

Tim Buckley, of Climate Energy Finance, said, “Solar ate coal’s lunch, and now batteries are eating gas’s dinner.”

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.

Other Notable News:

Sustainability Regulations

• South Korea announced this week that it has finalized its roadmap for International Sustainability Standards Board-aligned sustainability reporting rules, significantly expanding the number of companies compared to the initial proposals. It will be phased in, starting with 290 of the largest companies, and will expand dramatically in 2029 and again in 2030.

Sustainability Standards

• The Taskforce on Nature-related Financial Disclosures (TNFD) released a new discussion paper seeking feedback on proposed refinements to the TNFD’s invasive alien species (IAS) disclosure metrics.

AI and Sustainability

• New York this week became the first state to impose a one-year moratorium on data center construction, applying to facilities using 50 megawatts or more, due to rising energy bills and community backlash.

• Microsoft, Amazon, and Google all announced increases in their emissions this year as data center usage accelerates.

Corporate Net Zero Targets

• The world’s largest beef company, Brazil’s JBL, announced it is scrapping its 2040 net zero goal, citing execution issues.

Energy Transition

• A recent International Energy Agency (IEA) report found that renewable investment is on course to be $2.2 trillion in 2026, for the first time doubling fossil fuel investments.

European Sustainability

• The EU Commission has opened legal proceedings against all 27 member states for failing to fully transpose the Zero Emission Buildings Law. The transposition deadline was May 29th. Member states will have 2 months to respond to or transpose the rule.

• Europe’s new Public Procurement Regulation will require 50% of public spending to go to EU companies and will also include sustainability performance and environmental impact KPIs.

Notable Podcasts:

• In this week’s edition of the NYT’s Ezra Klein show, he spoke with climate activist OG Bill McKibben. The sprawling conversation touches on both the good and the bad of climate action. From the breakneck speed of the energy transition and abundance future, to the climate policy backlash from the US government.

• In the most recent episode of Outrage and Optimism, the hosts ask why so much climate action is decided in the courts. They discuss some notable cases among the more than 3,600 climate cases currently filed in 62 countries and share some of both the big wins and losses in climate litigation.

As sustainability budgets tighten across the sports industry (I am sure most other sectors recognize this trend), the organizations getting it right are moving past pledges toward audited, standards-based Net-Zero strategies.

In this Sustainability Deep Dive, we sit down with Benjamin Camus, Senior Director at Evolution Markets, who has spent the last several years helping motorsport teams, federations, and major sporting events develop Net Zero carbon strategies that withstand scrutiny.

1. Sustainability has faced a tougher business environment over the past two years. What have you seen within sports companies in the last 2 years? How have things changed or stayed the same?

Sustainability has definitely faced budget pressure and some fatigue over the past two years, but I’d push back gently on sport being swept into that narrative wholesale. What I’ve seen across our clients in the motorsport industry and other major leagues in the US and Europe is less “sustainability” as a communications exercise and much more of it becoming an operational requirement: audited Greenhouse Gas (GHG) inventories, International Organization for Standardization (ISO) 14064-1 certification, Science-based Target Initiative (SBTi)-aligned targets, and other sectoral requirements or regional regulations.

Sponsors, investors, and other stakeholders are now asking for evidence. So, while marketing budgets for sustainability may have shrunk, the technical and compliance side has grown. The organizations we work with are more serious, not louder. They’ve focused on credible frameworks like the British Standards Institution (BSI) Net-Zero Pathway, SBTi, or ISO 14068 rather than headline pledges that can’t survive scrutiny.

2. You’ve worked with governments, global companies, and the sports industry. What’s the biggest misconception leaders still have about carbon markets and their role in a credible net-zero strategy?

That carbon markets are a shortcut: buy some credits, call it Net-Zero, move on. In a credible strategy, carbon credits only enter the picture after you’ve measured your full Scope 1, 2, and 3 footprint and built a genuine decarbonization roadmap. They exist to address unabated and/or residual emissions, not replace reduction.

The second misconception is that all credits are equal. Additionality, permanence, no double counting, and no leakage. These criteria determine whether a credit is worth anything at all, and frameworks like Integrity Council for the Voluntary Carbon Market (ICVCM) and Airport Carbon Accreditation are increasingly explicit about project type and vintage.

Leaders who understand this treat carbon markets as a precision tool for the last mile of their strategy, not a blanket solution, and that distinction is exactly what separates a durable Net-Zero carbon claim from a greenwashing headline. Rephrasing and weaving in a long-term Net-Zero target into a comprehensive decarbonization strategy are critical steps in establishing a credible solution.

3. When you’re talking to sports executives, how do you make the business case for climate action beyond simply reducing emissions?

Emissions reduction, so the company saves, is the entry point, not the pitch. The conversation that lands with executives is about resilience and access: energy efficiency work that cuts operating costs at venues; sponsors and broadcasters who now screen partners on ESG credentials before signing; insurers and lenders who price climate risk into venue financing; and fans — increasingly younger and more vocal — who notice whether a club or federation is credible on this or just performing. There’s also a simpler point: professional sport happens outdoors, on fixed calendars, in front of the public. That makes it one of the most visible test cases for climate adaptation, which is exactly why frameworks like UN Sports for Climate Action have gained so much traction. When done well, climate action is now a conversation about brand, cost, and risk as much as an environmental one.

4. The World Cup has once again highlighted the growing impact of extreme heat on sport. Is climate change becoming a competitiveness issue for the sports industry? And what practical steps should organizers and governing bodies be taking today to raise awareness and adapt?

Absolutely — extreme heat isn’t a future risk for sport, it’s a current operating condition, and the World Cup has made it impossible to ignore. It’s already affecting scheduling, player welfare, and how governing bodies are perceived if they look reactive rather than prepared.

The practical steps already exist to build heat-risk assessment into venue planning and match scheduling now, not after an incident. Invest in cooling infrastructure and hydration protocols, and treat heat adaptation as part of the same climate risk assessment that feeds your decarbonization roadmap, rather than a separate issue.

Organizers who fold this into their broader Net-Zero and sustainability governance — instead of bolting it on as a PR response — will be far better positioned, and will look considerably more credible to players, fans, investors, and other stakeholders.

5. If you were giving one piece of advice to someone starting their career in sustainability today, what skill or mindset would you tell them to develop first?

Get fluent in the technical fundamentals before you get fluent in the language of sustainability marketing. GHG accounting, ISO standards, the mechanics of carbon markets, these aren’t the glamorous part of the job, but they’re what earn you credibility in the room with a CFO or a sponsor’s legal team.

The mindset that matters most is translation: being rigorous enough to understand the science and the standards, and clear enough to make the business case in language a non-specialist executive will actually act on. The people who last in this field are the ones who can do both.

What’s in this week’s newsletter:

1. Europe finalizes its new sustainability reporting standards, cutting requirements by 70%.

2. Europe still dominates global sustainability, with Japan the only non-European country in Yale’s top 20 for environmental performance.

3. The US is reshaping global climate policy, from the World Bank to EU methane rules.

4. The deadly heat this summer is harming Europe and North America, with more to come.

5. The GHG Protocol launches new Land Sector & Removals guidance and a request for information on Forest Carbon Accounting

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Europe has taken its final major step in simplifying corporate sustainability reporting, with the EU Commission adopting the new Sustainability Reporting Standards (ESRS) – the standards that European companies must use to comply with the Corporate Sustainability Reporting Directive (CSRD).

The so-called ESRS Set 2, released by the European Financial Reporting Advisory Group (EFRAG) earlier in the year, is dramatically different from the first set of standards used by companies to comply with the CSRD in 2025. These newly adopted standards:

• Have 60% fewer mandatory data points and no voluntary data points, resulting in 70% less in total.

• Are estimated to save reporting companies 30% compared to the previous standards, in line with Europe’s goal to reduce the financial burden of compliance by 25%.

While the reductions in data points are significant, the European Commission claimed the standards strike a balance between reducing administrative burden and upholding the quality of disclosures.

The Commission also adopted a voluntary reporting standard for smaller companies (VSME standard). The VSME Standard allows companies to report voluntarily under a less robust standard. Crucially, it also limits the amount of information that companies subject to the CSRD can ask from smaller companies in their value chain.

The new standards also respond to calls for greater alignment with global reporting frameworks. For example, this open letter from The World Federation of Exchanges (WFE) has urged regulators to reduce fragmentation and move toward a “report once” approach. The revised standards support this by aligning more closely with the International Sustainability Standards Board (ISSB) sustainability reporting standards and the Greenhouse Gas (GHG) Protocol Corporate Standard. Companies can now report using any of the GHG Protocol's three organizational boundary approaches: financial control, operational control, or equity share, bringing ESRS into closer alignment with other major sustainability reporting frameworks.

Most pundits claim these rules strike a good balance between reducing the administrative burden and making disclosures more decision-useful for investors and other stakeholders. For companies that must report, as this BCG report shows, this can be an excellent opportunity to reset and move from compliance-driven reporting to more strategic reporting.

The delegated acts will be sent to the European Parliament and Council, which have 2 months to debate the standards, before they enter into force. Any further changes are unlikely at this stage.

2. Europe Continues to Lead the Way

Despite European backtracking (or simplifying) many of their sustainability rules, they still perform best on environmental issues. Yale’s 12th biennial Environmental Performance Index (EPI) was dominated by European countries. Only one non-European country (Japan 16th) made it into the top 20 companies out of 177 countries judged on more than 50 environmental indicators.

While the reversal of major sustainability rules has hit the headlines, Europe continues to lead the way with new sustainability policies. Last week, it introduced new circularity requirements for the automotive industry and strengthened its Emissions Trading System by closing a loophole that allowed ships to reduce the carbon fees they had to pay by stopping at ports just outside the EU.

The European Court system is also leading the way. A Paris court recently made a landmark ruling, finding that the French oil and gas company TotalEnergies must develop and disclose a plan to reduce emissions from its products, known as Scope 3 emissions. The court ruled that TotalEnergie’s climate risks fell under France’s Corporate Duty of Vigilance law.

3. US Reshapes Global Climate Action

Unsurprisingly, the US fell to 27th in the Yale environmental index (above), as it continued to push an anti-climate-action agenda on the world. After intense lobbying at the World Bank, the global body decided to retire its target for having 45% of financing linked to climate “co-benefits.” The decision was made after France and other EU nations pleaded with the World Bank to keep the target, but the US, which holds the largest voting share at the World Bank, overruled them.

Europe is also under pressure from the US to weaken its methane rule. Germany’s energy minister, Katherina Reiche, has urged the EU to pause the implementation of the rule, which is set to expand to countries that import oil and gas to Europe - forcing them to limit flaring and methane leaks. Petro states, like the US and Qatar, say that would put Europe’s supply at risk.

The on-again, off-again war with Iran will also have long-lasting impacts on global climate action. In the short term, countries have revitalized waning coal-powered energy, with domestically produced coal replacing oil and gas amid supply shocks, but over the longer term, the trend is clear: countries want to wean themselves off oil and gas and transition to renewables, batteries, and electrification.

4. Deadly Heat Continues

As in 2024, this year’s El Niño conditions are causing new record high temperatures, with deadly consequences. June broke the record for the warmest average sea temperature, pushing us into “uncharted territory.”

In Europe, the UK, France, and some other Eastern European countries had their hottest June ever. In France alone, the heat resulted in an estimated 1,000 deaths. In the UK, a national climate security force was established during London Action Climate Week.

In the US, more than 20 states baked with over 100^OF (38^OC) heat over the July 4th weekend, forcing some events to close, and resulting in at least 25 deaths. And forecasters predict the heat will continue to rise.

5. GHG Protocol Launches Land Sector and Removals (LSR) Guidance

Last week, my company, the GHG Protocol, released a guidance document to support companies in implementing the Land Sector and Removals (LSR) Standard in their emissions calculations.

This companion piece was released to outline the accounting and reporting requirements of the LSR with worked examples, equations, calculation guidance, and 10 corporate case studies to see what it looks like in practice. The team also released an LSR reporting template and a reporting checklist

Also announced was a Request for Information for a new forest carbon accounting standard, which is open until February 1st, 2027.

The LSR Standard and Guidance will be available for companies to use from January 1st, 2027.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.

Other Notable News:

Trump 2.0

• The Trump administration paid Duke Energy $129 million to halt its offshore wind project, the fourth such deal it has made.

Global Weirding

• A recent CDP report released with the WWF revealed that, based on corporate climate disclosures, the world is on track to reach a staggering 3.2°C increase in average temperature by 2100.

Sustainability Research

• CDP’s second annual Disclosure Dividend report found that the median return on investment of managing environmental risks increased from $8 last year to $10 this year for every dollar spent.

• New research shared by a friend of the newsletter, Andreas Rasche, reveals that more in-depth sustainability reporting invites greater public scrutiny, showing that the value of reporting goes beyond reputation management.

Climate Reporting

• New Zealand became the latest jurisdiction on a growing list of countries proposing to adopt climate reporting aligned with the International Sustainability Standards Board’s IFRS S2 climate-related standard.

• The California Air Resources Board will hold another meeting for the 2027 implementation of its emissions reporting rule. The public workshop will include information on Scope 3 and assurance.

London Climate Action Week

• A group of 40 city mayors signed a pact on how AI data centers can be built and operated more sustainably.

Notable Podcasts:

• In this week’s edition of the Outrage and Optimism podcast, the hosts are retelling their experiences from London Climate Action Week. The main topics of conversation were the extreme heat that disrupted the event and a commitment from 41 major cities to push back against AI infrastructure.

• This week’s edition of The Rest of Politics features an insightful interview with Europe’s Energy Minister, Dan Jørgensen. In a wide-ranging interview, Jørgensen explains why clean tech is increasingly important, both economically and from an energy security perspective.

What’s in this week’s newsletter:

1. 75,000 attendees, 1,000 events, 39 C (102 F) - London Climate Action Week 2026 was ‘on fire”

2. ISO Launches Draft Net Zero Standard

3. California delays emissions reporting rule by 3 months

4. Climate scientists race to preserve US climate data

5. Climate tech IPO boom

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In the midst of a rare red heat warning with London sweltering under 39°C heat, 75,000 climate advocates, policy makers, and professionals descended on London’s Climate Action Week.

This year’s event was the biggest I have experienced, with more than 1,000 events across the city, some of which were, ironically, canceled due to the climate. Nevertheless, among the many events that did go ahead, there were some that stood out:

• At his keynote speech, UN Secretary-General Antonio Gutierrez said, “London isn’t just calling – it’s cooking. Around the world, climate disasters are becoming more frequent, more destructive, and more costly. And the World Meteorological Organization has warned we ain’t seen nothing yet.”

• Former New York Mayor Michael Bloomberg pledged almost $300mn to clean energy lobbyists to counter well-financed oil and gas lobbies. He said, “Clean energy is now cheaper than fossil fuels in virtually every part of the world . . . fixable obstacles are still slowing down deployment”

• The EU Commission was also there to announce a new global initiative, ‘Electrify Now.’ The group, which includes 11 countries and international NGOs, will facilitate practical help to mobilize investment, particularly in emerging economies. Europe’s Commissioner for Energy, Dan Jørgensen, said, “Our Electrify Now initiative can be a real driver of progress and change, bringing us closer to a future where our energy security and prices are no longer at the mercy of unstable geopolitics.”

• The UK announced its own deforestation rule, similar to Europe’s, which will require importers of certain high-risk products (soy, coffee, palm oil, rubber) to ensure they are not linked to illegal logging.

At the events I attended, there was a shared feeling that climate action has moved from ambition to implementation. I spoke at the Science-based Target Initiative’s (SBTi) flagship event (off the back of their Net Zero Standard 2.0 release), where, with David Kennedy, we discussed the importance of collaboration and coherence. The sentiment among the sweltering crowd was “let’s get on with it.” They cheered when I implored them to put aside petty disagreements and focus on progress.

I closed out our conversation saying, “There’s enough passion and energy and knowledge that we can work together. We can collaborate, and when we collaborate, we can do something wonderful.” That was my message for all of my events. Once we cool off, let’s get to work!

2. ISO Net Zero Standard

On the eve of London’s Climate Action Week, the International Organization for Standardization (ISO) released a first draft of its Net Zero Standard. The Net Zero Aligned Organizations Standard (ISO 14060) is now open for a 12-week public consultation to shape the next draft of the standard.

The standard is not a target-setting standard, like SBTi’s Net Zero Standard 2.0. Instead, it is meant to complement SBTi’s standards and aims to help companies create credible and comprehensive transition plans toward net zero, tailored to their maturity, sector, and specific company makeup. It requires companies to provide verified annual GHG reports and a detailed transition plan 2 years after setting their target. It also offers simpler approaches for small to medium-sized businesses.

ISO’s Head of Sustainability, Noelia Garcia Nebra, said, “ISO 14060 has been developed to provide a globally agreed framework that helps organizations build credible transition plans while supporting resilience, innovation, and long-term growth.”

3. California Delays Climate Disclosure

While a court case continues to hang over California’s Climate laws, companies were still expected to report their Scope 1 and 2 emissions on August 10th. However, on Wednesday, the California Air Resources Board (CARB) - the body responsible for the implementing rules - released an update that they will be making changes and pushing back the compliance deadline by 3 months to November 10th.

The delay will allow companies to internalize the changes and will provide a 15-day comment period after the updates are announced in the coming weeks.

4. US Climate Science Website Re-Emerges

Last year, as part of President Trump’s “Restoring Gold Standard Science,” the climate.gov website, which hosted climate data, reports, articles, and the Congressionally mandated national climate assessments, was blocked. This week, the team behind the climate.gov site brought it back to life under climate.us.

The site is a clone of the blocked climate.gov and aims to inform the American public on climate science. The cloned site was funded via a crowdsourcing campaign that raised $280,000 after the National Oceanic and Atmospheric Administration (NOAA) team behind the original site was laid off. Rebecca Lindsey, the managing director of the new site and a former NOAA staffer, said, “The best solutions to our climate challenges are going to come from a climate-literate public.”

5. Surge in Climate IPOs

After last month’s biggest-ever clean tech Initial Public Offering (IPO), from geothermal company Fervo Energy, there has been a surge in new climate IPOs. Driven by AI power demand, there have also been IPOs from Solv Energy, X-Energy, and Legence earlier in the year. Joining them is a growing group of nuclear fusion companies.

In China, the largest IPO on mainland markets in more than four years was just launched by a state-owned renewables company, China Resources New Energy Holdings. The public offering was oversubscribed by more than 600 times, and is expected to help the company raise $3.6 billion.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.

Other Notable News:

European Sustainability Rules

• The European Banking Authority released a draft of its ESG reporting standards, simplifying them, cutting the number of data points by a third, and extending them to smaller institutions.

• European member states have agreed to update Europe’s Sustainable Finance Disclosure Regulation (SFDR) to include fossil fuel investments in its transition fund category.

Sustainability Standards

• A new report from GRI found that the GRI Standards are the world’s most widely used sustainability reporting standards, used by 40% of all large listed companies.

Climate Litigation

• A group of ten Australians impacted by extreme weather events is bringing a case against the Australian Government’s lack of action to the United Nations.

• A new lawsuit filed by 17 Republican-led Attorneys General against California’s Extended Producer Responsibility rule alleges that the state is attempting to impose its own policy preferences on the entire nation.

• California is suing the federal Environmental Protection Agency for challenging its state gas-powered car phase-out, which the EPA sent to Congress for potential blocking.

Trump 2.0

• The Trump administration announced a $17.5 billion investment to help utilities purchase large components for up to 10 nuclear power plants.

Notable Podcasts:

• In this week’s edition of Outrage and Optimism, the hosts discuss the energy boom around AI data centers and how it impacts the communities where they are built. They talk to Nick Reece, the Lord Mayor of Melbourne, who discusses his city’s globally leading policies that support both data center developers and the communities where they are built.

• In the most recent episode of Harvard Business Review’s The Climate Rising podcast, they look at new autonomous aircraft being used to combat the growing threat of wildfires. They speak with Max Brodie, CEO of Rain, a company developing AI-powered wildfire suppression systems that enable faster response times and more effective intervention.

What’s in this week’s newsletter:

1. SBTi releases its Net Zero Standard 2.0

2. Europe expands its Carbon Border Adjustment Mechanism (CBAM)

3. The Iran War accelerates the business case for electrification

4. CDP splits into nonprofit and commercial organizations

5. Trump’s wind power vendetta continues

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With more than 11,000 companies now having verified targets, the Science-based Target Initiative (SBTi) is the global gold standard for setting emissions-reduction goals. Last week, it released the next iteration of its Net Zero Standard.

The Net Zero Standard 2.0 is a major revision with 42% of the standard completely net-new and the remaining 58% modified from the first version. The main changes are summarized here:

• This standard provides a renewed focus on implementation. The V2 is designed to help companies make decisions that advance their decarbonization goals and provides an implementation hierarchy.

• Companies can now make “best efforts” toward the goal without losing their verification, provided they can demonstrate they took good-faith action toward their goal.

• Companies can now set separate targets for Scopes 1, 2, and 3. Previously, Scope 1 and 2 were combined.

• The Ongoing Emissions Responsibility (OER) Framework provides greater clarity on the use of high-integrity carbon credits, which will be required after 2035 to neutralize residual emissions.

• A tiered approach for smaller companies (SMEs) and developing markets:

• Category A: >€50m turnover in high-income countries; >€450m in lower-income countries.

• Category B: SMEs (<€50m turnover) in all markets; companies in lower-income countries with <€450m turnover.

SBTi Chair Francesco Starace said in the V2 standard foreword that it “is designed to be a navigation tool for companies to manage their transition risk and unlock economic benefits in the world as it actually is.”

All companies establishing SBTi goals must use these standards from January 31st, 2028, but can use them voluntarily from January 31st, 2027. Companies with existing accredited targets will use the new standard, based on their mandatory five-year review trigger date.

David Kennedy, Chief Executive Officer at the SBTi, said: “We are at a critical moment for climate action: companies have told us that they need a partner that can help foster implementation, and that’s what the Corporate Net-Zero Standard Version 2.0 is designed to do.”

GHG Protocol (GHGP) and SBTi are committed to collaboration, building on years of working together. This will be especially important as we move into a critical time for climate action and as the GHGP releases multiple new standards, including a revised Scope 2 standard and the Actions and Market Instruments standard. GHGP has pledged to continue to collaborate and promote harmonization with its revised standards as they evolve.

2. CBAM Expansion

The world’s first climate import tax, Europe’s Carbon Border Adjustment Mechanism (CBAM), has been collecting tariffs since the start of the year. However, significant loopholes have allowed some producers of covered products (steel, aluminum, electricity, hydrogen, cement, and fertilizers) to evade the costs. To close these loopholes and prevent circumvention of the tariff, the EU Council agreed this week to add 200 new finished products to the tariff.

The move will bring an additional €160bn in annual imports under the tariff and will come into effect in 2028 if it can be successfully negotiated with the EU Parliament. EU Commissioner for Climate Wopke Hoekstra hailed its progress, saying, “This is truly excellent news for beefing up the level playing field. Industry has rightfully asked for these fundamental changes. We are delivering on them quickly.”

While Europe is using the CBAM to reduce climate emissions both within the Union and globally, it is also part of a wider attempt to improve Europe’s industrial competitiveness.

On the domestic front, the Commission is considering extending the Emissions Trading System’s free credit scheme, introduced in response to the energy shock of the Iran war, from 2039 to the 2040s. The proposal is set to be released on July 15th, and credits are expected to be available to companies investing in European markets.

Some companies that have already invested in decarbonization feel like they are being punished. Finnish steel producer Outokumpu’s VP of sustainability, Heidi Peltonen, said, “We have invested and started the journey. Loud voices haven’t, and we hope there’ll be a reward for the first movers.”

3. Decarbonization Becomes a Business Priority

As the Iran War comes to an end and the Strait of Hormuz begins to reopen, the world on the other side is very different. The oil- and gas-based economy of the past has been irrevocably replaced by one that prioritizes electrification and renewable energy.

The International Energy Agency revised its 2026 energy demand forecast downward, but said a surplus in 2027 could spur a rebound in demand.

Renewable energy companies have seen a surge, with batteries driving most of the new energy sector investments in recent months. Neon Chief Executive Xavier Barbaro said the Iran War oil shock was “a useful reminder of the importance of having green energy, sovereign energy, local energy, competitive energy.” But warned that momentum may not continue if oil and gas prices come back down.

For businesses, electrification and decarbonization have become an imperative. A recent survey conducted when the Strait was still closed revealed that 90% expect their operations to be largely electrified by 2035 and that moving ‌to a renewables-based electricity system is likely to boost economic growth. 79% said that geopolitical instability has made it more urgent for their businesses to shift to electrification.

4. CDP Splits

CDP, formerly the Carbon Disclosure Project, is the largest voluntary framework for environmental disclosures. After a quarter of a century, CDP has grown into a fundamental part of how companies, investors, and cities disclose and rate their environmental performance. This week, the non-profit announced a major shake-up, with private equity firm Permira taking a majority stake in a new for-profit business and splitting the company into two.

The non-profit side of the business will now be called the CDP Foundation, which will continue to focus on world-leading science and the evolution of the disclosure framework. The foundation will also hold a minority share in the new commercial side of the business.

CDP, a commercial business, will work collaboratively with the Foundation but will focus on delivering a seamless disclosure system and providing useful data for business decision-making. CDP Chief Executive Sherry Madera said, “This is a transformative moment, marking the next chapter of CDP’s evolution in service of global markets. CDP and CDP Foundation will be united in shared ambition. Together, they will uphold a pioneering disclosure system that will help unlock greater decision-useful insights to shape an Earth-positive economy.” The move will have no impact on the 2026 disclosure cycle, which opened on Monday.

5. More Wind Power Payoffs

The Trump administration continued its vendetta against wind energy, paying more energy developers to abandon wind projects and redirect their investments elsewhere. The government will pay Invenergy $765 million to give up four offshore wind leases. In exchange, the company said it will invest in natural gas and geothermal projects.

The agreement follows similar deals involving other offshore wind developers and a concerted effort by the Pentagon to delay projects through military reviews, a process that was previously a formality, but has delayed every current US wind project. Now, a coalition of wind developers has asked a federal court to order the Pentagon to resume reviews of the more than 100 stalled projects across 21 states.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.

Other Notable News:

Climate Investing

• A US pension fund is re-evaluating its stake in French energy company Total Energies after it took $1billion to halt its offshore wind project,

• The European Banking Authority announced a framework to begin integrating climate risk into its stress testing from 2027.

• EU members have reached a provisional agreement on the Sustainable Finance Disclosure Regulation (SFDR), indicating that they will allow investments in companies that are continuing to expand their fossil fuel use, a controversial aspect of the new regulation.

Climate Litigation

• The Department of Justice cited national security concerns in its attempt to halt a lawsuit against xAI’s use of polluting gas turbines in its Mississippi data centers.

Supply Chain Rules

• Canada has launched new legislation to ban products made with forced labor. The move comes in response to US tariffs that claim Canada has failed to ban imported goods linked to forced labor.

Notable Podcasts:

• In this week’s The Climate Rising podcast, the theme is all around how AI is reshaping how companies think about sustainability. It features an interview with IBM’s Chief Sustainability Officer, Christina Shim, who shares how new technologies such as AI, cloud infrastructure, and emerging areas like quantum computing are transforming corporate sustainability.

• In this week’s episode of the BBC’s The Climate Question, they ask what climate change will do to insects. With insects playing such a critical role in global ecosystems, impacting the spread of diseases and food webs, this episode asks what a warmer world looks like for them.

What’s in this week’s newsletter:

1. EFRAG estimates that non-EU companies in scope fall from 10,000 to 1,200

2. UN report warns AI adoption is outpacing environmental governance

3. ISO launches a new net-zero transition standard for finance

4. CDP and TNFD advance nature-related reporting metrics

5. World Cup faces growing sustainability scrutiny

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How the ‘Omnibus Simplification’ directive affects European companies subject to the Corporate Sustainability Reporting Directive (CSRD) has been clear since it was adopted earlier in the year.

But how it impacts non-European companies remained less clear until this week. The European Financial Reporting Advisory Group (EFRAG) shared that the number of non-EU companies covered under mandatory reporting has been slashed by 90%. A breakdown of the company locations is in the infographic below. US companies dominate the list, but are down to 350-450 from the original estimates of 4,000 companies covered.

EFRAG’s breakdown of how many companies in each country will be impacted

Last week, EFRAG released an update announcing that it will resume development of sustainability standards for non-EU groups (N-ESRS). The update provides information on how they expect the N-ESRS to differ from the general ESRS, launches a call for interest from potential reporters to participate in a field test, and outlines a timeline for the standard, with a draft release in July, followed by a 100-day comment period.

This announcement from EFRAG comes as the comment period for the simplified European Sustainability Standards (ESRS) closes, where a growing chorus of European stakeholders has called for the ESRS to be more in line with international standards to simplify compliance and comparability.

One comment from Norges Bank Investment Management (NBIM), the manager for Norway’s sovereign wealth fund, requested that EFRAG allow reporters to be in compliance with the ESRS and International Sustainability Standards Board’s standards (ISSB) within one report. Similarly, in another comment from GRI, they asked for stronger alignment with other international standards to improve competitiveness.

And in related news, a group of leading practitioners, lawyers, and academics issued an open letter prompting Europe to move ahead with the Corporate Sustainability Due Diligence Directive (CS3D) to avoid further delays and more business uncertainty.

2. ISO’s Net Zero Transition Standard For Finance

Last week, the International Organization for Standardization (ISO) announced a new landmark standard for helping the financial sector transition to net zero. The “ISO 32212, Sustainable finance — Net zero transition planning for financial institutions,” will provide financial institutions with the requirements and recommendations they need to conduct investing, lending, and other financial activities in line with net-zero emissions and to mitigate risks and capture opportunities.

Scott Steedman, Director-General, Standards at ISO’s UK member body, BSI, said, “Financial institutions have a pivotal role in the transition to a net zero and climate-resilient economy. ISO’s new international standard, ISO 32212, is a best practice tool developed with input from leading organizations across the financial sector and will be globally adopted by countries throughout the ISO membership.”

3. Standard Makers Advance Nature Reporting

Nature continues to be an area of focus for sustainability standards, and there were two new developments this week:

• CDP will include ocean-related risks and opportunities in its questionnaire for the first time this year, when the 2026 disclosure cycle opens next week (June 15th).

• The Taskforce on Nature-related Financial Disclosures (TNFD) issued a discussion paper on how reporting companies can include environmental crime in their nature assessments and disclosures. It aims to help companies identify illegal environmental activities in their value chain to better understand their impacts, risks, opportunities, and dependencies.

4. AI Adoption Outpacing Governance

This week, a damning new report from the UN revealed that the environmental and social costs of AI adoption are outpacing the governance structures needed to mitigate these risks. It found that by 2030, AI infrastructure will use energy equivalent to the needs of 650 million people, and occupy land twice the size of the megacity of Jakarta.

It also provides a series of principles that companies and policymakers can use to ensure AI adoption is sustainable, ethical, transparent, and equitable.

But it’s not all bad news, AI is enabling better environmental performance and simplifying reporting:

• New AI software is enabling more efficient use of aging boilers, saving New Yorkers $5 million and reducing emissions, too.

• This new report from PwC revealed that the majority of investors and other public disclosure users are using AI to read and simplify reports. The report also provides guidance on how reporters can adapt their reporting to be easily accessible by AI readers.

5. World Cup Sustainability Woes

This week, the biggest global sporting event, the Soccer (Football) World Cup, kicks off in the US, Canada, and Mexico. This year has been controversial for many reasons, but environment-related issues have been hitting the headlines this week, leading up to the games.

• Despite FIFA’s goal of halving emissions by 2030, a Greenly analysis found that this year emissions from the event will almost double Qatar’s in 2022, coming in at over 7 million tons of CO2e, the equivalent of 1.7 million cars’ annual emissions.

• FIFA was also forced to reverse its decision not to allow reusable water bottles in stadiums after a backlash, a move that would have meant fans could only use single-use plastics.

• Health risks from potentially very high summer temperatures are also growing, with at least a quarter of games expected to be played in dangerous wet-bulb conditions.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.

Other Notable News:

Climate Investing

• The annual ‘Banking on Climate Chaos’ report from a group of leading NGOs found that the top 65 global banks increased fossil fuel spending by 27% and that fossil investing is dominated by the top 12 banks, mainly in the US and Japan.

• The UK’s Financial Conduct Authority has proposed replacing its current Taskforce on Climate-related Financial Disclosures (TCFD)-aligned reporting for investors with a simplified version to save more than £20 million ($26 million) a year.

CDP

• CDP launched a new AI tool to help cities identify climate risks and find funding for adaptation.

Energy Transition

• A new Energy Information Administration analysis reveals that China’s nuclear output has almost doubled in the last 10 years.

• In May, Solar energy overtook coal energy for the first full month on record, with coal’s share of US energy generation falling nearly 50% over the last five years.

Global Weirding

• Increasingly common 125°F heatwaves are making the Dadu region of Central Pakistan uninhabitable.

• After Europe suffered the hottest May on record, scientists warn that the continent should get used to dramatic temperature swings.

Trump 2.0

• The Trump administration has pledged a $700 million fund to bolster the rapidly declining coal industry and invest in the first new coal power plants in more than 13 years.

Notable Podcasts:

• In this week’s episode of Bloomberg’s Zero podcast, host Akshat Rathi explores what 100 days of the Iran War have done to the global energy transition. Focusing on Asia, he claims that the continent is having its Ukraine moment and realizing how fragile its energy supply chains are, which is driving it to adopt renewables at a faster pace.

• In this week’s edition of The Climate Question on the BBC, the presenters ask whether oppressive heat will affect this World Cup. It also explores the carbon emissions of this year’s event and how future sporting events can adapt to a warming world.

What’s in this week’s newsletter:

1. The US SEC moves to rescind its climate disclosure rule.

2. European businesses issued the ‘Dublin Declaration’ calling for more EU deregulation.

3. Brazil shifts climate reporting to “comply or explain.”

4. The UK sets an ambitious new target to reduce emissions 87% by 2040.

5. The UN warns countries to prepare for a potential Super El Niño.

The US Securities and Exchange Commission (SEC) climate reporting rule has been a common thread running through this newsletter since it was proposed in 2023. That seems like a very long time ago now. There was great excitement back then when it looked like the world’s largest economy would incorporate material climate risk with financial disclosure.

This week, almost exactly 2 years to the day since the rule was approved, the conservative majority SEC issued the formal Rescission of Climate-Related Disclosure Rules. This was not a surprise since the SEC dropped its defense of the litigation on the rule, but the formal rescission marks the end of the road for this policy. The 134-page proposal spells out four main reasons why the SEC no longer believes the rules should be enacted:

1. The rule is outside of the remit of the SEC

2. Compliance would require undue cost and burden

3. The rule is inconsistent with the SEC’s materiality-based approach

4. The rule does not fit with the SEC’s current policy objectives

SEC Chair Paul Atkin, in a statement, said, “I have been concerned about the 2024 Climate Rules for some time because of questions raised about the Commission’s authority to adopt them and the soundness of the policy basis to support them.”

The rescission was welcomed by the plaintiffs who litigated against the rule. Mike Flood, of the US Chamber of Commerce, said, “The Chamber is encouraged that the SEC is returning to the core principle of materiality, allowing investors to gather crucial business information through corporate disclosure.”

However, much of the US investor community expressed deep disappointment in the rescission. Benjamin Schiffrin of Better Markets said the proposal will give investors less of the information they need to make decisions, adding that this “is antithetical to the SEC’s mission, which is supposed to be to protect investors.”

There is a 60-day comment period open now, and the rescission will be finalized in 2027.

But as the curtain closes on the SEC climate rule, regulations in other jurisdictions are on the rise. In just 10 weeks, the first reports will be filed under California’s emissions reporting rule (SB 253).

Given that California is the largest economy in the US (and 4th largest in the world), and its rules cover companies doing business in the state, thousands of US companies will be reporting essentially the same information required by the now defunct SEC rule.

And regulations requiring climate disclosure are coming on line in ~50 nations that are adopting the international climate standards from ISSB. In addition, the EU requirement to disclose climate emissions, risks, and other sustainability information applies to the 29 EU countries and companies doing business in those countries.

The message is clear: climate disclosure is a reality with or without the SEC rule.

2. Europe’s Deregulatory Dublin Declaration

In a week when the European Commission issued an infringement notice to 20 member states for failing to transpose an anti-greenwashing directive, a business lobby coalition met in Ireland to announce the Dublin Declaration - a call for Europe to take more deregulatory action.

The Declaration includes six proposals aimed to improve EU competitiveness, including a moratorium on new rules and further reductions in the existing regulatory burden. The coalition claims that the deregulatory action through the recent ‘Omnibus’ processes “is not yet felt by companies.” They call for the withdrawal of the pending Green Claims Directive and for an adaptation of the EU Emissions Trading System (ETS) to account for competitiveness while maintaining environmental ambition.

A Swedish member of the EU Parliament, Jörgen Warborn, shared his support for the Declaration, calling it a “strong foundation.” Green MEP Kira Marie Peter-Hansen, on the other hand, claims that “Europe’s competitiveness issues are not solved by throwing the EU’s green legislation out the window.”

3. Brazil Climate Disclosure Becomes Voluntary

One year before Brazilian companies were required to provide climate reports aligned with the International Sustainability Standards Board (ISSB) climate standard, Brazil’s Securities and Exchange Commission (CVM) decided to move to a voluntary system.

Brazilian public companies will now have to report on a “comply or explain” basis - this means they can substitute an explanation for public climate disclosures. Companies that decide to continue climate reporting must do so for three consecutive years and maintain use of the ISSB standard. The CVM said these new rules “preserve transparency and comparability but restore the necessary respect for the freedom of entities to estimate the expected costs and benefits of their decisions on how to use investor resources.”

4. UK Doubles Down on Climate Despite Headwinds

Despite facing a backlash, the UK government has set one of its most ambitious emissions reduction targets to date.

There have been calls from former Prime Minister Tony Blair to abandon net zero and embrace North Sea oil and gas, and other political parties have vowed to completely scrap any climate policy. Ignoring these voices, the UK government announced a new target to reduce emissions by 87% from 1990 levels by 2040, aligning with recommendations from the UK’s independent Climate Change Committee.

The announcement cited a new Confederation of British Industry (CBI) report released this week to back up its claim that Britain’s net zero target and progress toward it have been a “British success story.” The report found that the net zero economy is now worth £105bn a year and supports 1.1m jobs. British Energy Minister Ed Miliband said, “As Britain faces the second fossil fuel shock of the decade, the only way to protect family and business finances is to drive for clean homegrown power that we control.”

5. El Niño Preparedness

As evidence of a Super El Niño mounts, and most weather models are predicting a very strong event, the UN has warned countries to prepare.

The World Meteorological Organization (WMO) now puts an 80% probability that an at least moderate El Niño will begin by September. António Guterres, the UN Secretary General, said the world “must treat it as the urgent climate warning it is. El Niño conditions will pour fuel on the fire of a warming world.”

That prediction comes a week after the WMO said there is almost a certainty that a record-breaking hot year will occur before 2030, and a 75% chance that the 5-year period between 2026 and 2030 will be 1.5°C above the pre-industrial average. Gareth Redmond-King, from the Energy & Climate Intelligence Unit, “The havoc El Niño will wreak as it likely delivers another hottest year, in 2027, will be devastating for many farmers, and a question of life or death for far too many people.”

Need a refresher on what El Niño is, how it impacts global weather patterns, and how it will impact global crops? ClimateAi produced an El Niño Outlook.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.

Other Notable News:

Climate Litigation

• The long-running legal debacle between Greenpeace and oil and gas pipeline company Energy Transfer took another strange turn as a North Dakota court blocked Greenpeace International from making claims in a Dutch court.

• Seven states sued the Trump administration this week over its deal to kill an offshore wind farm project by paying the developer Total Energies $1 billion.

Sustainable Funds

• As Europe gears up for its new Sustainable Finance Disclosure Regulation (SFDR) after simplifying it, some are worried that many investors will change their funds to a new classification that requires much less rigorous reporting and oversight.

California Climate Policy

• California made some changes to its Cap and Trade system to alleviate fuel cost increases from the Iran war. Critics say the changes could harm emission reduction goals and reduce climate funding.

Trump 2.0

• The Trump Administration announced the dismantling of an ocean monitoring system critical for marine and climate science. Democrats claim they will fight the move.

• In a moment of rare bipartisan support for clean energy, Republicans and Democrats in the House voted to pass a package of permitting reforms for geothermal energy.

• After US tariffs were considered unlawful and removed, the Trump Administration has released a new set of tariffs linked to human rights violations. A claim that the 60 targeted countries refute.

Global Weirding

• New research shows that 2025 was the most costly year from a wildfire perspective, causing $54 billion in damages.

Notable Podcasts:

• The most recent edition of The Climate Rising podcast explores how a new AI technology can unlock geothermal energy. It features an interview with Joel Edwards, CTO of Zanskar, a company that reduces the risk and cost of discovering new geothermal resources by using AI to identify viable sites.

• In this week’s edition of Pitching Progress from BCG’s Vinay Shandal is on the challenges of building sustainable supply chains. He speaks with EcoVadis Co-founder and Co-CEO Pierre-François Thaler, who explains why companies still need an in-depth view of their suppliers’ sustainability performance, even amid competing priorities such as geopolitics.

What’s in this week’s newsletter:

1. Climate adaptation becomes a $1.3 trillion investment opportunity

2. TISFD releases the first draft of its social disclosure framework

3. Sustainability momentum continues despite backlash

4. The UN backs the ICJ’s landmark call to action on climate

5. Europe faces a carbon credit integrity scandal

Amid geopolitical and economic turmoil, the climate crisis has fallen down the totem pole of public awareness. But nature does not care about the news cycle, and this week we had some stark reminders of who is in charge…

Deadly heatwaves across Europe and the UK broke the record for May heat. A forecasted Super El Niño has nations scrambling to prepare. Most hope that improved resilience practices will mitigate the worst impacts of El Niño, and a new report finds that 92% of UK homes will need to adapt to avoid overheating.

The failure to adequately curb emissions has led to the disasters that climate scientists have been warning about for decades, and now adaptation to this new reality is essential. But this reality has also opened new climate investment opportunities - as reported by Bloomberg this week - and the magnitude is astounding:

• Adaptation is a $1.3 trillion investment opportunity, with major, capex-intensive flood-defense engineering projects in cities from Tokyo to Nairobi becoming big business.

• Tech-enabled startups are developing a variety of solutions with the overall adaptation sector pulling in $5.5 billion of equity funding last year, doubling its share of climate finance since 2021.

The potential returns of adaptation are well documented. BCG released a report last year finding that adaptation investments could return $19 for every dollar invested, and CDP confirmed this with an estimate of a 21x ROI.

Asia is taking the lead with adaptation and resilience investments now at $100 billion. And while 90% of that investment came from the public sector, increasingly, private equity is moving in.

Jay Koh, co-founder of an adaptation investing group, said, “What you’ve seen is an increasing recognition accelerating over the course of the last 18 to 24 months of real investor awareness.” Adding that while adaptation accounts for only 5% of climate funding today, these investments are looking more attractive because of both the returns and the fact that they are not as politicized as renewable energy investments.

2. TISFD

First, it was the Taskforce on Climate-related Financial Disclosures (TCFD), then the Taskforce on Nature-related Financial Disclosure (TNFD). Now the focus has turned to social disclosures. The Taskforce on Inequality and Social-related Financial Disclosures (TISFD) released the first draft of its standard this week to help companies identify and disclose people-related impacts, dependencies, risks, and opportunities.

The new framework follows the same four pillars from its predecessors: Governance, Metrics and Targets, Strategy, and Impacts and Risk Management. Three important elements of this new standard:

1. It is built to work in harmony with the International Sustainability Standards Board (ISSB) Standards, the GRI Standards, and the European Sustainability Reporting Standards (ESRS), thereby reducing fragmentation.

2. It can be used as a standalone standard or a complement to existing standards to reduce duplicative work.

3. It is designed to reflect the interconnections among people, climate, and nature, and to support linkages between the TCFD and TNFD.

You can help shape this standard through the interactive platform, which is open until July 31st. The final framework is expected to be released in late 2027.

3. Sustainability Reporting Momentum Continues Despite the Backlash

This Reuters article from this week highlights a trend we have been tracking for the last couple of years. Despite the much-discussed backlash against climate and sustainability in the US, Europe, and some other countries, the global trendline toward sustainability continues.

The article cites an Osapiens report showing that 9 in 10 companies that fell out of mandatory reporting in Europe will continue or expand reporting; the continued acceleration of voluntary reporting under the CDP and other frameworks; the momentum behind the ISSB; and other signals indicating the global trend lines toward sustainability are remarkably resilient.

New data released this week from CDP showed that US-based reporting companies massively increased the maturity of their climate reports in recent years: The number of companies adopting a voluntary climate goal ratified by the Science-Based Targets initiative (SBTi) tripled since 2020, climate scenario analysis increased by 80% since 2021, and many companies have expanded their disclosures into forestry and water reporting. CDP’s Chief Executive, Sherry Madera, said in a recent interview, “Companies don’t disclose because they have to, they disclose because there is a business reason to do so.”

4. Most of the World Backs Climate Action

Last year, the International Court of Justice (ICJ) issued a unanimous advisory opinion, finding that nation-states have legally binding obligations to prevent climate change and protect the health of their citizens. This week, the UN’s General Assembly overwhelmingly (141-8) backed that finding. The eight nations that voted against were petro states like Saudi Arabia, the US, and Russia.

The resolution urges member states to take action to avoid the worst impacts of climate change and meet the goals of the Paris Agreement. UN Secretary-General Antonio Guterres called it a “powerful affirmation of international law, climate justice, science + the responsibility of states to protect people from the escalating climate crisis.”

Ahead of the vote, the Trump Administration urged nations to pressure Vanuatu, the small Pacific island nation that brought the resolution, to withdraw it. However, Odo Tevi the UN ambassador of Vanuatu - a nation being slowly swallowed by rising sea levels - said, “Upholding the court is essential for the credibility of the international system and for effective collective action.”

5. Europe’s Dubious Chinese Carbon Credits

This week, Bloomberg reported that nine European countries bought 500,000 tons of carbon credits from dubious Chinese carbon capture projects. Companies in the Changqing oilfield claimed to offset hundreds of thousands of tons of carbon emissions. But when BloombergNEF investigated, either there was no operation at all, or the technology to capture carbon was not in place.

This is another blow to the integrity of the carbon credits market, but oversight and quality are improving in this vitally important mechanism for battling the climate crisis.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.

Other Notable News:

Standard Harmonization

• The ISSB and GRI vowed this week to deepen their collaboration and optimize their standards to ensure greater interoperability.

Fast Fashion

• Fast-fashion brand Shein bought eco-friendly clothing brand Everlane. Everlane claims it will maintain its sustainability policies.

Trump 2.0

• The Trump administration is delaying the phase-out of the powerful greenhouse gas hydrofluorocarbons used in air conditioning and refrigeration.

Climate Communications

• Twenty years after the release of one of the most important climate documentaries ever, “An Inconvenient Truth,” Al Gore’s messaging has changed. As with many others, the argument has shifted from a moral to an economic one.

Emissions

• The International Energy Agency (IEA) launched a new global methane regulator network this week, with more than 30 countries. The goal is to accelerate policy action to mitigate methane emissions.

• China’s new calculation methodology for measuring the carbon intensity linked to GDP makes its emissions appear lower, but it has been criticized for a lack of transparency.

Global Weirding

• Climate scientists predict that El Niño will mean a quieter hurricane season in the Atlantic but bring more turbulent storms in the Pacific.

Climate Targets

• McDonald’s released an update on its climate goals, revealing that operational emissions are down but that it is unlikely to meet its Scope 3 goals.

Notable Podcasts:

• This week’s edition of Two Steps Forward, by Joel Makower and Solitaire Townsend, warns that sustainability professionals should be ready for wildcards. They discuss how the profession is all about momentum and process, but few are prepared for shocks such as the upcoming El Niño or the data center backlash.

• This week’s Carbon Accounting and Management podcast features an interview with Mike Hower. Mike shares his new book, “Sustainability Storytelling,” and goes into the “Four Cs” framework he developed for effective sustainability communication.

What’s in this week’s newsletter:

1. Climate action moves beyond targets

2. EV adoption accelerates

3. Geothermal has its IPO moment

4. Shareholder power struggle over climate action

5. The worst-case climate scenario improved!

If you value independent sustainability reporting and analysis, you can support Sustainability Simplified through an optional Substack pledge. Subscribe or support here.

In recent months, some companies, states, and nations have scaled back their climate targets, policies, and funding. In the last week:

• New York extended the effective date for its climate law to 2028. The interim goal of 40% reduction by 2030 was replaced with a 60% by 2040 goal. The move was taken in a state budgeting agreement after Governor Kathy Hochul called the 2019 Climate Law “costly and unattainable.”

• The UK halved its funding for the UN’s Climate Fund, adding to the $4 billion funding gap after the US withdrew its funding last year. This fund was meant to help the developing world with energy efficiency and transition to low-carbon sources.

• Canada’s government signed a deal with the oil-rich province of Alberta on initiating a carbon price in exchange for approving an oil and gas pipeline. The deal did not sit well with some; Climate Action Network issued a statement alleging that Canada’s Prime Minister Mark Carney “was once one of the world’s most prominent climate champions, who has effectively destroyed Canada’s chances of reaching its climate targets.”

Five years ago, these stories may have felt like a death knell for climate action. But in today’s world, broader economic trends are the main driver of climate action, not targets. Climate targets are not disappearing, but they are becoming less central to the story.

Bloomberg NEF’s 2026 Future Energy Report, released this week, revealed that countries decoupling from fossil fuel imports due to recurring oil and gas crises is now the biggest accelerant for renewables, and that low-cost, abundant solar panels will make solar the largest single source of energy in the next 6 years.

From a corporate standpoint, most companies are continuing with their climate action programs due to the business benefits. PwC’s annual decarbonization report last month found that 82% of companies will maintain or accelerate their decarbonization efforts, primarily because of the business value.

CEO of the Science Based Target Initiative, David Kennedy, in an op-ed this week, said, “Targets are like a map that shows the route but does not get us to the destination,” adding that the companies that win in the net zero transition “will not be those with the most ambitious targets, but those that embed climate considerations into the core of how they compete and grow.”

All of this is not to say that climate targets are unimportant or unnecessary. It’s more that climate action is increasingly driven by energy security, affordability, and competitive advantages.

2. EV Adoption Accelerating

The International Energy Agency’s “Global EV Outlook 2026” report revealed rapid growth in the EV market. EVs made up 20% of new car sales in 2025, but, driven by the oil crisis, that number is set to jump to 28% this year. Countries most impacted by oil and gas imports in Europe and Southeast Asia will see the most rapid growth. Even with no new policies, there could be more than half a billion EVs on the road by 2035.

Also driven by high fuel prices, the world’s largest battery-powered motorcycle company, Chinese company Yadea, increased exports by 70% this year and is looking to expand into Europe, the UK, and Central America.

All of this expansion, coupled with new electric ships, trucks, and mining equipment, has led the leading Chinese battery producers, CATL and BYD, to call for more lithium. The current market predictions may actually underestimate demand.

3. Geothermal Taking Off

As solar and gas companies struggle with labor and equipment shortages, could geothermal be the renewable energy source to meet rising demand? The recent Initial Public Offering (IPO) of geothermal company, Fervo - the largest-ever clean-tech IPO valued at $10 billion - would suggest yes.

The potential is huge. Geothermal is one of the few renewables that is not intermittent, and the International Energy Agency estimates that geothermal could provide 15% of global energy by 2050. However, the technology still faces many challenges in meeting the growing demand. Currently, there is only one commercial-scale plant, and the cost is not yet competitive with energy from solar and gas.

4. Shareholder Power Struggle

Shareholders’ rights to push for more climate action in proxy voting have been a recurring flashpoint. This week, there were moves from powerful activist shareholders to influence oil and gas firms. Allianz Global Investors supported a proposal from New York’s comptroller advocating a shareholder-friendly voting system for Exxon investors. Also, investors in big tech companies are asking how they can reconcile AI data centers with climate policies.

Exxon is also currently in a battle with proxy advisers over its proposed move to Texas. In response, Texas Attorney General Ken Paxton has sued the world’s largest proxy voting company, Institutional Shareholder Services, Inc. (“ISS”), for what he calls: “radical political agendas over sound financial principles and fiduciary duty.”

5. Climate Predictions Improve(!)

Scientists are reconsidering their most severe warming scenario, RCP 8.5 (Representative Concentration Pathway 8.5), after a paper found it was now “implausible.” The RCP 8.5 model would mean carbon concentrations of greater than 900 parts per million, more than double today’s concentration, and a global average temperature rise of 4.5°C. However, due to the rapid increase in clean tech adoption, the worst-case scenario has been softened.

This rare case of good climate news was pounced upon by US President Donald Trump, who falsely claimed that climate scientists have admitted they were “WRONG” about climate change. Adding that “For far too long, Climate Activism has been used by Dumocrats to scare Americans, push horrible Energy Policies, and fund BILLIONS into their bogus research programs.” Carbon Brief does a great job of explaining what these climate scenarios are and how Trump’s claims are inaccurate.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.

Other Notable News:

Sustainability Reporting

• The Australian government is removing smaller companies from its sustainability reporting mandate. Companies with under A$100 million revenue will now be exempt.

• The US Securities and Exchange Commission has issued a formal “reconsideration” to the court - a step toward the long-anticipated withdrawal of its climate-reporting rule.

DEI

• PayPal was forced to pay $30 million to settle a case brought by the US DOJ alleging “illegal DEI.”

Climate Targets

• Google confirms its 2030 carbon-free climate commitment despite increasing AI-driven energy use.

Carbon Offsets

• Governments made a record $107 billion from carbon credit trading in 2025, with more than 30% of global emissions now covered.

Trump 2.0

• The US Environmental Protection Agency announced this week that it would drop limits on so-called “forever chemicals” in drinking water.

Notable Podcasts:

• In this week’s edition of Bloomberg’s Zero: The Climate Race podcast, host Akshat Rathi interviews the Deputy Leader of the UK Reform Party. Reform is currently leading in the polls and promises to reverse all of the UK’s climate policies. Things get heated when the subject of climate science comes up.

• In this week’s The Climate Rising podcast, they explored how AI and satellite technologies are improving climate solutions. It features an interview with BCG X Managing Director and Partner David Potere, who explains how BCG X is using satellite data, AI models, and real-time sensing systems to improve decision-making in decarbonization, agriculture, and energy.

What’s in this week’s newsletter:

1. ISSB passporting boosts adoption of sustainability standards

2. Renewables surpass gas in the US despite political backlash

3. AI data centers spark growing local resistance across America

4. Tom Steyer makes the economic case for climate action in California governors race

5. Warming oceans and wildfire risks raise El Niño fears

The International Sustainability Standards Board (ISSB) expects at least 10 more jurisdictions to adopt its standards this year. This was revealed in a speech transcript published by the ISSB, delivered by its Chair, Emmanuel Faber.

The speech was from the ISSB’s April meeting, where the group’s big announcement was its controversial stance rejecting a standalone nature standard.

Faber asserted that sustainability disclosures are important, even when some say “ESG is a thing of the past.” He argued that geopolitics and AI have made the need for resilience even more acute, adding that “a tool that allows companies to express their…ability to thrive in a complex world is even more a topic for today than it was in the past.”

The most notable revelation was ISSB’s claim that more than 50 jurisdictions will be committed to using, or already use, the ISSB standards as their disclosure baseline by next year. These new additions include Peru, Ethiopia, and Oman.

Faber said a critical part of the ISSB’s growth is the introduction and expansion of the concept of passporting - a program spearheaded through their jurisdictional adopters working group of 40 jurisdictions, including China. The group’s goal is to increase ISSB adoption through a “seamless language” to improve comprehension and comparability.

2. US Renewables Continue to Thrive

The anti-renewables policy under the Trump Administration has blocked wind projects and cut the tax credits that drove the energy transition. However, it’s becoming increasingly clear that the Administration’s plans to block renewables are not coming to fruition.

In March, renewables produced more energy in the US than gas for the first time on record. “The State of Renewable Energy Dashboard,” released this week, revealed that renewables have tripled over the last 10 years and that more than 30 states now have at least 10% renewables in their energy mix. Aligned Climate Capital CEO Peter Davidson said, “There is no truth to the death of the clean energy industry in the United States – in fact, just the opposite.”

Opposing this trend, the US Secretary of Energy Chris Wright said, “I’m pretty confident coal will lead the world in global electricity production when I die.”

Taking the other side of that bet, a New York pension fund threatened to remove its (small) investment in French energy company Total Energies for accepting Trump’s $1 billion to halt work on an offshore wind farm.

On a global scale, the Iran war has prompted many countries to accelerate renewable energy, and even NATO backs renewables as a solution to energy security, despite US skepticism. All of this led one reporter to call it “Trump’s Green New Deal.”

3. Data Center NIMBYism

US energy consumption is rising, with electricity demand projected to increase by 1.3% in 2026 and over 3% in 2027, largely driven by AI data center expansion and electrification. The EIA forecasts that commercial sector electricity demand will surpass residential demand by 2027, with total power consumption reaching new records in 2026.

A backlash is growing among residents angry about rising energy and water bills. Environmental and noise complaints could stifle growth in some states. Currently, $64 billion worth of projects are tied up with planning hurdles, and NIMBY-ism (Not In My Backyard) is one of the main reasons.

New flashpoints are erupting daily, like Maryland’s push back on $2 billion of taxpayer-funded out-of-state grid enhancements linked to AI-driven data centers. And one of the biggest approved projects to date, the Stratos data center in Utah, has been called ‘irresponsible‘ due to its scale. The project is set to be double the size of Manhattan Island and use more energy than the entire state.

4. California’s Climate Governor?

California Governor hopeful Tom Steyer

The California gubernatorial race is heating up with a broad field of candidates from both parties. One of the current frontrunners is billionaire and climate advocate Tom Steyer. Steyer is running on a climate-centric platform. However, instead of approaching it from a planetary-emergency standpoint, Steyer is framing climate action under the umbrella of affordability. In this NYT interview, he explains why clean energy is an economic imperative.

On the other end of the spectrum, the Republican with the highest potential for votes, Steve Hilton, has vowed to ‘scrap’ all of the state’s climate policies.

5. Wildfires and Warming Oceans

April 2026 had the second-highest surface sea temperatures of any April since records began, and scientists warn this is the strongest sign of an impending El Niño. The last time ocean surface temperature records were broken in 2024, it was the hottest year on record and had some of the most costly extreme weather events to date.

Climate-driven drought conditions in Oregon, Washington, Florida, and Georgia are already causing widespread wildfires. Scientists warn that droughts, wildfires, and floods are likely to be amplified as El Niño approaches.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.

Other Notable News:

Sustainability Research

• Trellis’s ninth bi-annual State of Sustainability Profession report reveals that sustainability investments are down, and have fallen down the priority list of CEOs, but most large companies are maintaining their programs.

• Two pieces of research this week show that corporate climate action is driving down emissions and reducing deforestation rates.

Climate Risks

• HSBC convened a meeting of the UK’s largest banks to discuss how they can meet growing regulatory and investor demands to assess, report, and mitigate their climate risks.

• The European Central Bank this week released its updated good practices for climate and nature-related risk management and stress testing, warning that most banks significantly underestimate climate and nature risks.

Climate Litigation

• A court in North Dakota ruled that the International Greenpeace group should not be allowed to bring a case in its home country, the Netherlands, as part of the long-running legal battle between the group and pipeline company Energy Transfer.

• New Zealand’s government has moved to block civil lawsuits against fossil fuel companies for their role in climate damage.

Sustainability Hero

• Environmental legend David Attenborough celebrates his 100th birthday this week. To commemorate the occasion, the NYT has produced this photo album.

Notable Podcasts:

• In this week’s episode of Two Steps Forward with Joel Makower and Solitaire Townsend, the pair digs into the State of Sustainability Report. They discuss how the survey reveals a profession under pressure, and how doing inner work and soul-searching could be a way out.

• In the most recent edition of Bloomberg’s Zero podcast, they discuss how electrification could bring about an era of global stability. Host Akshat Rathi speaks with former Chief of Staff to Canadian Prime Minister Justin Trudeau - Gerald Butts - about what the world looks like after the green transition and whether the same supply chain and geopolitical risks will remain.

We’ve officially moved Sustainability Simplified to Substack as we begin the next chapter of this work.

We’ve officially moved the newsletter to Substack as we begin the next chapter of this work.

At the same time, I am stepping into an exciting new role focused on advancing the GHG Protocol, where I’ll be helping shape the future of corporate climate action. That evolution is also shaping where we want to take this publication.

Going forward, Sustainability Simplified will continue covering the 5 biggest news stories in sustainability every week, told in a clear, accessible way, plus curated news and podcasts, and interviews and deep dives with global sustainability leaders

We’re also exploring ways to make this work more sustainable and independent long-term. In the coming weeks, we’ll introduce optional supporter pledges for readers who value the newsletter and want to help support this reporting, interviews, and analysis.

The core newsletter will remain free.

If you’d like to continue following along, no action is needed, and if there’s a topic you’d like us to cover more, just reply to this email.

Thanks for reading,

Tim

What’s in this week’s newsletter:

1. Europe’s simplified sustainability reporting standards inch forward

2. EU drops leather products from deforestation policy

3. US blocks maritime shipping carbon levy again

4. The US SEC is to rescind climate reporting and quarterly financial disclosures

5. Clean tech investment surge continues 

After slashing Europe’s Sustainability Reporting Standards (ESRS) by more than 70%, the European Commission is finalizing the streamlined draft.

The ESRS are the reporting standards required by Europe’s Corporate Sustainability Reporting Directive (CSRD). The European Financial Reporting Advisory Group (EFRAG) released the simplified standards late last year. This final draft maintains most of those changes, reducing the overall number of data points by 70% and thereby reducing compliance costs by 30%. 

However, the Commission made some notable changes in three main themes:

• Materiality: This draft offers a more pragmatic, simplified approach to materiality. Companies can take a strategic approach – focusing on decision-useful information and avoiding the need to consider the materiality of each individual impact, risk, and opportunity.

• Emissions and climate targets: Companies will align their emissions calculations with the Greenhouse Gas Protocol standards by selecting either the financial control approach or the operational control approach. Also, they must include an explanation if their climate transition plan is not aligned with the 1.5°C average global warming target.

• Omissions: If certain data points (e.g., microplastics, human rights incidents) are omitted, they must be explained by difficulties in collecting or substantiating data.

Another big revelation was that Europe rejected full alignment with the framework from the International Sustainability Standards Board (ISSB), an idea floated by the Commission a couple of weeks back. 

Public consultation ends June 3rd, and adoption is likely this year.

2. Europe Weakens Deforestation Rule

Another simplification was revealed this week for Europe’s Deforestation Rule (EUDR). The beleaguered policy, which had already been delayed (twice), is meant to block imports of products (e.g., coffee, timber, cocoa, soy, cattle) produced on deforested land.

The new simplification exempts leather products and treaded tires from the list of covered goods. The move aims to support European industries and adds a certification system to reduce the need for due diligence and risk assessments. 

The timeline remains the same – meaning larger companies will have to comply starting December 30th, 2026, followed by smaller companies 6 months later.

Anke Schulmeister‑Oldenhove of the WWF said, “We’re encouraged to see the EUDR finally moving from promise to practice. But now the EU must hold the line.” However, she adds that “Weakening the EUDR by exempting specific sectors would undermine the regulation’s credibility, make compliance more complex and enforcement less effective.”

The comment period for the new EUDR simplifications is open until June 1st.

3. Shipping Carbon Tax Pushed Down the Road

Last year, the first global carbon tax for shipping under the “Net Zero Framework” gained a majority support of maritime nations and was expected to be adopted. However, at the last minute, it lost support due to the Trump Administration’s threatened tariffs on countries preparing to sign the pact. 

Now, after another unsuccessful meeting of the UN’s International Maritime Organization (IMO) in London last week, the deal is being pushed back to later in the year, and delegates are being asked to suggest alternative options. 

While the IMO Secretary-General Arsenio Dominguez said, “We are back on track, but we have to rebuild trust.” The Trump Administration is once again attempting to pressure delegates to block it. The US Federal Maritime Commission said, “The US will explore all potential remedial options to protect American consumers from a disputed and unneeded global carbon tax,” calling it a global version of Europe’s emissions trading system.

The framework would require global shipping to reach net zero by 2050, and ships over 5,000 gross tonnage to pay a carbon tax. The majority of countries (55) still support it, claiming it is preferable to the growing patchwork of carbon pricing rules in Europe, the UK, and other nations.

4. SEC to Kill Climate Reporting and Quarterly Disclosures

Shortly after Trump took office in 2025, the US Securities and Exchange Commission (SEC) dropped the legal defense of its climate reporting rule. Since then, the rule has been in limbo. Not quite alive, but not fully dead. This week, the SEC is putting the final nail in the coffin with the “Rescission of Climate-Related Disclosure Rules.” 

In contrast, California – the largest US economy – has moved forward with its climate disclosure mandate, which is broader in scope. The first California reports are due within 100 days. 

Another proposal revealed that the SEC plans to move from quarterly earnings reports for public companies to twice-yearly reporting. While the motive is deregulation, the move could enable climate actions that have longer return timelines.

5. Record-Breaking Clean Tech Investments

With no let-up in sight for the oil and gas crisis, clean-tech investment records continue to be smashed. In April, energy funds saw their largest net inflow of investment capital in more than 5 years. Charles de Boissezon at Société Générale said, “investors are pricing the cost of relying on imported fuels in a world that keeps springing geopolitical surprises,” adding that it was ironic that policy U-turns in the US have “actually been a tailwind.”

One technology experiencing a surge is heat pumps, which joined EVs in recording record-breaking sales in the first three months of 2026. Sales are up by a third in Germany and by almost a quarter in France, indicating that consumers are looking to mitigate their exposure to energy price increases. 

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.

Other Notable News:

Climate Targets

• After losing many of its members last year, the Climate Action 100+ group released a new framework this week. The new framework, which was broadly welcomed by members, killed the assessment of climate disclosures and scenario analysis and tweaked other requirements.

Climate Investing

• A $300 billion New York pension fund warned BlackRock and Fidelity that their investing practices are misaligned with the fund’s net zero goals.

Energy Transition

• China’s big bet on wind is looking more prescient than ever. They now have the six biggest turbine manufacturers. They installed three times as much wind energy as the rest of the world combined last year, and exports have reached a record high.

• On the other end of the spectrum, it was reported this week that the Trump administration has now blocked more than 150 onshore wind projects.

Climate Litigation

• The Trump administration sued the state of Minnesota this week to block the state’s 6-year-old consumer protection lawsuit against oil and gas majors.

• A California court stalled the state’s lawsuit seeking climate-related damages from oil and gas majors while a similar rule makes its way through the Supreme Court.

Sustainability Research

• A new study released this week found that microplastics in the atmosphere could be exacerbating climate change, playing a role like that of GHGs.

Notable Podcasts: 

• This week’s Science Weekly podcast from the Guardian asks if a new global agreement could be the beginning of the end of the fossil fuel era. They discuss whether the talks to transition away from fossil fuel meeting in Santa Marta, Colombia, where more than 50 countries met, could accelerate the energy transition.

• This week’s Outrage and Optimism podcast looks at new research on how the Atlantic Meridional Overturning Circuit (AMOC) could weaken faster than previously thought. The AMOC (or the Gulf Stream) slowing or stopping would have extreme impacts on the global weather. The podcast team asks what the best way is to communicate such an extreme risk.

Healthcare generates one of the most stubborn waste streams in the global economy. While packaging and manufacturing dominate the circularity conversation, hospitals and biopharma facilities have largely been left out, even as the volume of regulated medical waste continues to climb.

This week, I sat down with Malcolm Bell, CEO of Envetec Sustainable Technologies, to ask why healthcare goes under the radar, what a credible recycling model actually looks like for biopharma, and what separates the organizations getting ahead of this from the ones who’ll be caught flat-footed.

1. Most circularity conversations focus on packaging and manufacturing. Why has healthcare been so overlooked, and why is it now becoming impossible to ignore?

Healthcare has been overlooked because most circularity conversations start with the easiest target. Packaging is the low-hanging fruit. It is easier to address and discuss. Healthcare is not. It brings you straight into questions of safety, regulation, and operational complexity.

But it can no longer be ignored because of the sheer volume of single-use plastics used in hospitals, biopharma production, and home injection and monitoring devices. When you seriously examine what is classified as biohazardous and regulated medical waste, you see that this is not a fringe issue. It is a major operational and environmental challenge that has been hidden in plain sight for years.

2. Healthcare is dominated by single-use, highly regulated materials. What makes circularity in healthcare fundamentally harder than in other industries, and where do most “well-intentioned” solutions fall short?

If the ambition is to achieve circularity, you are immediately faced with regulatory issues if recycled material comes into contact with a patient sample, reagent, or drug. This is a great example of ‘Perfect is the enemy of good,’ as these materials can be used in many non-regulated products in healthcare manufacturing.

However, because these waste materials must also be decontaminated before they can enter the recycling ecosystem, it is far easier to continue with the ‘out of sight, out of mind’ approach and send this waste for autoclaving, incineration, and landfill.

There are very few well-intentioned solutions, as most people steer clear of this waste stream because it is deemed problematic.

3. What does a credible, scalable circular model for healthcare waste actually look like in practice, and what has to change across the system to make it work?

As just discussed, circularity is not achievable in many cases, but recycling back into the healthcare industry is. In my view, biopharma production is one of the clearest places to begin because it relies heavily on single-use plastics, including bioreactors, tubing, and clarification filters. The waste stream is consistent, has a polymer content of 90% or higher, and contains a very low percentage of non-polymer material.

If the goal is landfill avoidance and repurposing or recycling of this waste, the intervention must be implemented before autoclaving and incineration, with safe treatment and materials recovery built into the system from the outset.

4. Healthcare organizations are under intense regulatory pressure, as well as cost and operational constraints. How do you move this conversation from “compliance and risk” to something that actually creates business value for healthcare companies?

You move it by recognizing that this is not only a compliance issue but also a public health and reputational issue, especially when the waste stream leaves the facility.

The more control an organization has over how biohazardous or regulated medical waste is handled, the more it reduces risk beyond the site itself. That is where the business value becomes tangible, with less exposure, less reputational risk, and far greater control over a difficult waste stream.

5. We’re at an inflection point across sustainability with more scrutiny on real impact and ROI. Looking ahead 5–10 years, what will separate leaders from laggards in sustainable healthcare, and what are most organizations still underestimating today?

I do not think this will remain optional for long. In ten years, I am not sure “laggards” will even be the right term. For some organizations, the pressure could become severe.

Many organizations still underestimate the backlash they may face if they continue relying on outdated treatment methods such as autoclaving and incineration. You cannot keep presenting yourself as improving health while ignoring the broader health and environmental consequences of how biohazardous and regulated medical waste is handled. That contradiction will become much harder to defend.

What’s in this week’s newsletter:

1. GHG Protocol names its inaugural CEO

2. Investors ramp up pressure on BP and UK banks

3. EFRAG sets out 2026 reporting priorities

4. Countries convene for first fossil fuel phase-out meeting

5. EV adoption approaches a global tipping point

In all my five years of writing this newsletter, I never thought I would be both writer and subject, but here we are. On Tuesday, it was announced that I would become the inaugural CEO of the Greenhouse Gas Protocol (GHGP).  

Across more than 250 editions of this newsletter, the evolution of standards, climate reporting, and corporate emissions has been a constant thread. So, it is a bit of a full-circle moment to break the fourth wall by being in the news this week. 

 I'm using this edition to share my thoughts beyond what I shared in this post, as well as some news from the WSJ, Trellis, and others regarding my appointment.  

 All the articles written about the new role allude to the magnitude of the moment we are heading into in carbon accounting standards. There are several long-awaited standards, along with a new partnership with ISO.   

 Considering all of this, as Geraldine Matchett, Chair of the GHG Protocol Steering Committee, said, “The scale of our work and the pace of change across the reporting landscape bring with them a growing need for a dedicated CEO role and will enable the organization to meet rising expectations while sustaining the integrity and independence of its standards.” 

 I made this choice the same way I have made all my career decisions – by focusing on how I could contribute most to improving our planet. While standards can be very technical, they establish one set of rules for the entire world. And, the Greenhouse Gas Protocol standards create a global common language to enable decarbonization. 

The GHGP is the foundation of humanity’s fight against climate change. It has served in this critical role for decades and is a largely unsung hero behind countless environmental benefits.  

With 97% of the S&P 500 companies using the standards to measure emissions, and governments around the world increasingly requiring their use, the picture becomes very clear: this work enables our fight against climate change – the existential threat of our time. 

While I love my job at BCG, when it comes to impact, leading the Greenhouse Gas Protocol is a once in a generation opportunity. I am so grateful to my colleagues at BCG and my new colleagues at GHGP.  This job will have many challenges, but I am eager and excited to get started.  

 A big thank you to all of the well-wishers who have sent their support. There are too many to mention here, but I thank you all for your kind messages. I hope to fulfill the incredibly important mission of both the GHG Protocol and the wider climate movement as we move into a critical time for action. 

2. Investors Pile on the Pressure

This week, investors piled on the pressure on some of the UK’s largest banks, and activist investors scored a win on the UK’s largest oil and gas company, BP.

In a week when BP was the target of a new windfall tax in the UK after benefiting from record profits from the Iran War, the oil and gas giant also suffered defeats on proposals to reduce its climate reporting at its annual general meeting. The proposal was to overturn a previous resolution on climate reporting because it is now covered by mandatory reporting. It only gained the support of 47 percent of voting investors, far below the 75 percent threshold required for the proposals to pass.

BP also came under fire for blocking a resolution from activist shareholder group ‘Follow This.’ The group asked BP to explain how they plan to manage a world shifting away from fossil fuels. Follow This founder Mark van Baal said the group’s question is simple: “How does BP plan to create value for shareholders as oil and gas demand declines?” adding that “BP would rather antagonize its shareholders than answer it.”

UK investors also pressured the country’s biggest banks by voting against the reappointment of key figures, after many of them scaled back their climate commitments in their lending practices. The votes, coordinated by ShareAction, led to reduced support for the chairs of NatWest and HSBC, following decisions by both banks to expand oil and gas financing.

3. EFRAG Sets Out Sustainability Reporting Priorities

Under the leadership of the newly appointed Sustainability Reporting Board Chair, Kerstin Lopatta, who takes over today, the European Financial Reporting Advisory Group (EFRAG) released its sustainability reporting priorities for 2026. The priorities center around:

• Development of sustainability reporting standards for non-EU companies, with a draft released by July 10th. 

• Providing implementation support, especially for smaller companies.

• Advancing interoperability with international standards to reduce fragmentation.

• Improving digitization through XBRL taxonomy updates and the ESRS Knowledge Hub.

You can find the full EFRAG 2026 Work Program here.

4. First Phase Out of Fossil Fuels Meeting

In Santa Marta, Colombia, this week, delegates from 60 countries, along with NGOs and other stakeholders, met for the first global meeting on phasing out fossil fuels - the US was not invited.

The group, established at COP30 last year, and co-hosted by the Netherlands and Columbia managed to reach significant agreements on fossil-fuel reducing trade measures. They also reached agreements on transparency for fossil fuel subsidies and financial reforms that help countries break away from fossil fuel-based economies.

Stientje van Veldhoven-van der Meer, the Dutch minister of climate and green growth, said “I hope that we can really establish this coalition of the willing, those who, whether they want to move fast or slow, do feel the need to get started.” Whereas a White House spokesperson said, “The United States will not participate in the bogus climate agenda.” 

5. EV Tipping Point

New research released this week from the University of Exeter revealed that the electric vehicle revolution is now unstoppable, and everywhere but the US has reached a tipping point away from internal combustion engines. In 2025, EVs accounted for a quarter of new car sales, and momentum has continued into the first quarter of 2026, despite a slowdown in China following the end of subsidies. 

Other recent research from UBS predicts that EVs and plug-in hybrids will account for 58% of new cars by 2035, up from 23% today. Fiona Howarth, founder of UK-based Octopus Electric Vehicles, said that with longer ranges, falling prices, and lower operating costs, buyer behavior for EVs is changing “in a way that’s hard to unwind, which are early signs of a market crossing a tipping point.” And as they come down the cost curve, we could see adoption accelerate even in the US.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer. 

Other Notable News:

Sustainability Reporting 

• PwC’s third annual decarbonization report finds that 4 in 5 companies held or accelerated their emissions reduction targets, and more companies are increasing their ambitions than decreasing them

Energy Transition

• The world’s biggest battery maker, Chinese company CATL, plans to release an additional $5 billion worth of stock as its stock price has skyrocketed 40% since the Iran War.

• A new Ember report finds that in 2025, every OECD country was below its emissions peak, marking the first non-COVID year in which both India and China reduced their fossil fuel emissions.

Sustainability Standards

• GRI updated its mapping to CDP’s 2026 questionnaire to simplify cross-disclosure, reduce workload, and improve comparability.

Deforestation

• Global deforestation reached a 10-year low in 2025, driven mainly by declines in deforestation due to protection measures. However, fire-related losses are increasing. 

Notable Podcasts: 

• In this week’s Two Steps Forward podcast from Joel Makower and Solitaire Townsend, they explore the new in-vogue sustainability term “resilience.” They argue that this resilience is not a rebrand. Sustainability has always been about resilience.

• In this week’s edition of the Outrage and Optimism podcast, the team looks at the First Conference on the Transition Away from Fossil Fuels. As more than 50 countries descend on Colombia for this inaugural conference, the question is what structural issues are still stalling the energy transition.

What’s in this week’s newsletter:

1. Positive environmental trends cut through the doom and gloom

2. ISSB votes down single nature standard

3. Europe accelerates response to Iran energy shock

4. The Greenhouse Gas Protocol floats another carbon accounting standard

5. Environmental groups sue oil and gas majors

With Earth Day (April 22nd) this week, this NYT article covering hopeful environmental trends, and the recent Artemis II moon flyover (as used in today's image), I started to feel the rumblings of optimism and hope for the future. 

We all live with the daily barrage of stressful news about conflict, attacks on science, and backtracking on sustainability, yet there remain so many reasons to be hopeful and so much worth fighting for. 

In recognition of Earth Day and in hopes of inspiring you, dear reader, here is a somewhat surprising summary of this year’s continuing progress to become a more sustainable society. 

Energy Transition

March was a hockey stick month for Chinese clean tech

The NYT article pointed to progress in reducing emissions in some areas (EU, UK) and flattening in others (China), and to an International Energy Agency (IEA) report showing, for the first time, that renewable energy was the single largest source for meeting new economy-wide energy demand. Solar power accounted for 25% of new global energy demand, followed by gas; in total, renewable sources, including nuclear, met 60% of new demand.

A new report from Ember, supports the IEA findings. Ember’s report looked at new demand growth at the electrical grid level and found that 75% of demand growth was met by solar power in 2025. Aditya Lolla, interim managing director at Ember, said low-carbon electricity was “scaling fast enough to absorb rising global electricity demand,” adding that momentum is now locked in as a “structural reality.”

Not surprisingly, another Ember report also showed that China’s solar exports reached a record $21.9bn in March 2026, 70% higher than in March 2025. Last month was a record month for Chinese clean tech across all categories (see graph above), likely due to the Iran oil shock. EV car sales are also surging in places like Europe, where oil prices increases from the Iran war have caused a 51% spike in sales.

Corporate Action

While some have backtracked, the majority of companies are continuing or accelerating work on sustainability. especially as the business case becomes clearer. 

Last week, we shared that the number of companies with science-based net-zero targets jumped 40% in 2025. This week, a new survey of 7,000 companies from G7 countries found that 69% increased net-zero spending in 2025, and 75% believe net zero is important for their business. However, they are framing their communication in terms of resilience and risk mitigation.

Ceres CEO Mindy Lubber said, “This isn’t a straight line, and it’s definitely not fast enough, but overall, the direction is clear: markets, companies, investors, and policymakers are still moving forward.”

Global Regulations and Standards

While the US federal government has swung toward retrenchment, sustainability regulations are expanding elsewhere. US States are moving ahead with climate reporting and extended producer responsibility rules. On a global scale, the International Sustainability Standards Board (ISSB) has been adopted by capital markets around the world. And despite the recent simplification efforts, Europe continues to lead in sustainability - from emissions trading, ethical sourcing, carbon tariffs, producer responsibility, and disclosure - the EU has a policy for each. 

A new report released this week by my company, BCG, paints four contrasting scenarios for 2050, showing what could be possible under more positive scenarios of international climate collaboration and AI abundance. The decisions we make over the next five years as voters, leaders, and companies will determine the next 25.

As sustainability professionals, it's critical that we keep our eyes on the horizon, be resilient, and continue to drive progress.  For more inspiration, watch the late, great Carl Sagan’s “Pale Blue Dot” speech.

2. ISSB Votes Down Nature Standard

At an Earth Day meeting in Beijing this week, the International Sustainability Standards Board (ISSB) voted to follow staff recommendations and will develop a non-mandatory ‘practice statement’ as opposed to a new standard for nature.   

The practice statement was widely considered the weakest of the four possible options the ISSB had, which also included adding nature-related reporting to its two existing standards, S1 sustainability-related reporting or S2 climate-related reporting, or adopting a stand-alone standard. 

The ISSB claims this will ensure companies won’t face further disruptions as they adopt S1 and S2 and won't incur undue costs. However, this route has been broadly criticized. A group of NGO leaders wrote an open letter asking the ISSB to develop a dedicated S3 nature standard “to support and enable the private sector to assess and address their nature impacts and dependencies.”

Anita de Horde, CEO of Finance for Biodiversity Foundation, said, “We are disappointed that the ISSB has chosen not to advance a nature standard at this stage. Given the urgency of biodiversity loss and its financial implications, this is a missed opportunity.” Former Unilever CEO and sustainability leader Paul Polman said, “The answer cannot be to leave nature at the margins. Nature is not separate from climate. It is a fundamental part of the same Earth system.”

3. Europe’s Answer to the Energy Crisis

Europe’s climate commissioner Wopke Hoekstra

As the flow of oil through the Strait of Hormuz remains restricted, the resulting energy crisis continues to bite. Increasingly, countries are forced to take drastic measures, which is driving the surge in Chinese clean-tech exports. 

In Europe, where some nations are seeing protests over rising fuel costs, Brussels issued emergency conservation measures similar to those at the outset of the Ukraine war. Under the banner: “AccelerateEU,” the EU Commission's recommendations include fuel vouchers, EV credits, remote working, and encouraging domestic clean energy.

Europe’s climate commissioner Wopke Hoekstra said: “The only way forward is more electrification, more nuclear, more solar, more wind, more battery capacity, more interconnectors in the European Union, and all of it with much more speed.”

4. GHG Protocol’s Expanding Standards

There has been more movement in the carbon accounting space in the last year than in the last 20 years! Continuing that trend, the GHG Protocol (GHGP) recently released a new white paper on its Actions and Market Instruments (AMI) standard-setting process. The AMI is designed to enable companies to accurately measure and report emissions mitigation beyond the company's operations and direct supply chain.

The white paper introduces a multi-statement reporting structure to supplement, not replace, physical inventory. Acknowledging that different accounting methods provide different information and serve different purposes, a total of four statements are under consideration for the multi-statement reporting structure: 

1. Physical GHG inventory

2. Market-based GHG inventory

3. GHG impact statement 

4. Non-GHG indicators 

The 60-day comment period closes May 31st, ahead of a final draft in 2027.

5. Lawsuits vs. Oil and Gas Majors

Two lawsuits this week against leading oil and gas firms could set long-term precedents:

• The Dutch non-profit Friends of the Earth Netherlands, known as Milieudefensie, has opened another chapter of its long-running legal feud with Shell. In this most recent case, Milieudefensie is attempting to stop Shell from drilling new oil and gas wells, claiming it would conflict with international climate agreements

• In the US, a group of environmental NGOs has sued the Trump administration over its approval of a $5 billion BP deepwater oil and gas project. The suit alleges that the project is risky and an accident could be worse than the Deepwater Horizon spill.

In a related case, a federal judge issued a temporary injunction against the Trump Administration's restrictions on wind and solar projects. The judge said that the suit alleging unlawful discrimination against wind and solar power would likely prevail.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer. 

Other Notable News:

ESG Reporting

• The European Banking Authority (EBA) proposed a major simplification of its ESG disclosure rules for banks to align them more closely with recent EU simplifications to corporate reporting.

Corporate Sustainability

• General Motors announced it achieved its goal to source 100% of its renewable energy to power its U.S. sites by 2025, a goal they accelerated twice from 2050 and 2030. 

• Apple announced significant milestones: 30% of all products are now made from recycled materials, 50% of its water use comes from restoration projects, and suppliers have procured 20 GW of renewable energy.

Global Weirding

• New research released last week found that the historic Italian city of Venice will ultimately be lost to climate-driven sea-level rise without significant interventions.

Scope 2

• Ahead of the much-anticipated GHGP’s Scope 2 Standard update, Jigar Shah, former director of the U.S. Department of Energy Loan Programs Office, laid out his critique of the proposed standard, criticizing its potential impact on the energy transition.

Trump 2.0

• More good Earth Day news: The US House of Representatives was planning to reduce protections for endangered species, but had to cancel at the last minute when it became clear they would not get enough votes.

Notable Podcasts: 

• In this week’s edition of the Bloomberg podcast Zero, the question raised is whether China and India are doing enough on climate. Host Akshat Rathi reviews recently released climate updates from the world’s two most populous states and wonders whether they go far enough to address the climate crisis or are too cautious.

• As the US rolls back federal rules on forever chemicals, this week’s edition of the Outrage and Optimism podcast looks at how these chemicals came to be, the health implications of them, and whether community action can replace US policy changes.

What’s in this week’s newsletter:

1. Europe considers swapping its standards for the international version 

2. Carbon tariffs begin in Europe, and the UK will follow 

3. New carbon accounting standards for products are on the way 

4. Nature reporting matures

5. US climate skepticism at the highest levels 

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Five years ago, the International Sustainability Standards Board (ISSB) launched at COP26 in Glasgow. Since then, ISSB has issued two standards - S1 for general sustainability reports and S2 for climate reporting. Adoption of these new standards has grown steadily, with ~36 jurisdictions that have adopted or are moving to adopt ISSB standards. 

In the meantime, Europe was developing its own sustainability reporting standards (ESRS). While there are some similarities, there are also some major differences between these schemes. Multinational companies and others have complained that these differences lead to added cost and inefficiency. 

None-the-less, Europe steadfastly held on to its own standards…until now. 

In a surprise move, the European Commission is considering swapping its homegrown standards (ESRS) for the standards issued by ISSB.   

This would be an enormous change in how companies report their sustainability data under the Corporate Sustainability Reporting Directive (CSRD). The biggest and most controversial change is that the ISSB standards are solely focused on financial materiality - referring to the sustainability issues that could substantially move the bottom line. 

Europe’s standards used the more stringent “double materiality” test - meaning companies had to report sustainability issues that impact the company’s finances AND the issues that impact people and the planet.  

ISSB Chair Emmanuel Faber, speaking at a recent EU Parliament event, offered a compromise approach: “reports written in a way to provide all financially relevant information clearly and not obscured by information that is provided for other users,” which would still “fully respect the double materiality principle.” 

In other words, companies would use the ISSB standards to report on financially material issues and could choose to report their other impacts using other established standards from organizations such as the Global Reporting Initiative (GRI). 

The move is backed by some German Members of the European Parliament. However, a French business group was skeptical, saying “New, fuzzy notions proposed by the ISSB could make CSRD reports more complicated for all European companies.”

This latest controversy will land on the desk of the newly appointed Chair of the European Financial Reporting Advisory Group (EFRAG) Sustainability Reporting Board, Kerstin Lopatta, when she takes over on 1 May 2026. 

After the massive simplification campaign last year, Ms. Loppata will inherit a delicate balance of ensuring the European standards deliver meaningful, decision-useful information while driving economic competitiveness. With this latest move, the stakes are even higher as thousands of companies are currently preparing their reporting strategies and now have significant uncertainty.

 2. European Carbon Tariffs Take Shape

Europe’s carbon border adjustment mechanism (CBAM), the world's first emissions tariff, kicked in its pricing mechanism at the start of this year. Last week, Europe’s Taxation and Customs Union released the first CBAM certificate price for the first quarter. The price for Q1 is €75,36 per metric ton of CO2e (Carbon Dioxide equivalents) based on the average auction prices in the EU Emissions Trading System. In 2026, a new price will be recorded for each quarter, but in 2027, prices will be published weekly.

The UK is following Europe’s lead with new draft regulations for its own CBAM, expected to be applicable starting January 1st, 2027. The UK’s CBAM is designed to be interoperable with Europe's, covering the same products and at a similar cost. The new draft outlines how the UK plans to calculate and verify the embodied emissions of covered products and is open for consultation until May 21 2026.

3. New Standards to Measure Product Carbon Footprints

This week, the International Organization for Standardization (ISO), as part of its new partnership with the GHG Protocol, announced the launch of its working group for product-level GHG accounting standards. The new standard will create a globally consistent method to measure the carbon emissions associated with products and is aimed at enabling the implementation of carbon tariff schemes (CBAMs) around the world. ISO and the GHG Protocol will host a webinar on April 24th to share their progress on the product-level standard and harmonizing carbon accounting standards in general.

In related news, ISO issued an update to its Environmental Management System (EMS) standard (ISO 14001) this week. ISO 14001 is the most widely used EMS standard with more than 670,000 certified organizations worldwide. Recent research has shown that the adoption and use of ISO 14001 are directly linked to improved environmental performance and emissions reductions. 

ISO Secretary-General Sergio Mujica said, “The new edition of ISO 14001 is smoother to implement, making it easier for organizations of all sizes to embed environmental management into their strategy, achieve tangible results, and demonstrate real impact.”

4. Nature Reporting Matures

Beyond climate reporting, nature seems to be the next area of focus. As this recent Reuters report shows, pressure is growing on companies to report their nature-related risks.

However, standard setters are still working out the kinks in how companies measure their nature impacts. A new discussion paper from the Taskforce on Nature-related Financial Disclosures (TNFD), the Science-Based Target Network (SBTN), and the Global Reporting Initiative (GRI) explores how these standards integrate nature metrics across assessment, disclosure, transition planning, and target setting.

They are also seeking public input on their proposals for embedding the recently finalized Nature Positive Initiative (NPI) nature metrics. You can provide feedback on the discussion paper by June 4th 2026.

5. Climate Consensus Questioned by US Leadership

US EPA Administrator Lee Zedlin (middle) and Treasury Secretary Scott Bessent (right)

Politicians in high cabinet positions in the Trump Administration have made it clear they do not believe the scientific consensus on climate change. 

Environmental Protection Agency administrator Lee Zeldin, who was the keynote at a recent  “climate realism” convention, focused his remarks on “energy dominance” and “cutting red tape” rather than environmental protection and public health. Treasury Secretary Scott Bessent, this week at a World Bank meeting, called climate change an “elite belief,” and questioned the scientific consensus of climate change, saying, “We are going through cycles, and I believe that it is very difficult to deconstruct the reasons around why anything changes.” 

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer. 

Other Notable News:

Corporate Climate Action

• After news broke that Microsoft had paused its carbon removal program, the company's CSO came out a day later to say that they continue to “build on and support” its carbon removal portfolio.

• Reports indicated the Delta silently dropped its 10% sustainable aviation fuel by 2030 target amid supply constraints.

SBTi

• The number of companies with net-zero targets validated by the Science-based Target Initiative grew by 40% in 2025, mainly driven by companies in Asia.

Sustainability Regulations

• Canada launched a new sustainable finance taxonomy to align private investment with climate goals, providing guidance for funds with labels like ‘transition’ and ‘green.’ 

Sustainability Research

• A new landmark report from Cambridge University explores the intersection of environmental and social risks and how those interconnections impact investors. 

Energy Transition

• To combat rising energy prices, sales of solar panels have increased by 50% since the start of the Iran war and will likely rise again when low cost plug-in solar kits become available in a couple of months.

• At the other end of the spectrum, Europe has proposed softening its methane import rules to ensure it can secure enough oil and gas.

Global Weirding’

• New research finds that the likelihood of collapse for the Atlantic meridional overturning circulation (AMOC) - the Gulf Stream -  is much higher than previously thought, and that this will lead to much colder winters, drier summers, and higher sea levels for much of Europe and Africa.

Notable Podcasts: 

• In this week’s edition of the Harvard Business Review’s The Climate Rising podcast, the hosts discuss Patagonia’s move into food. They talk to Patagonia Provisions General Manager Paul Lightfoot on the role of regenerative agriculture and sustainability in the new venture from the apparel company and how they want to use it as a testing ground to drive transformation in the food system.

• In this week’s Outrage and Optimism podcast, the hosts explore reframing sea-level rise as a health risk more than a physical infrastructure risk. They ask if climate policy would be different if we reframed sea-level rise as a food insecurity, disease, or displacement issue.

Sophia and I first collaborated in 2023, building technology partnerships at the intersection of AI and sustainability. When she told me she was leaving BCG to join Macrocosm’s leadership team, I immediately wanted to hear more about what Macrocosm is building.

I recently sat down with Macrocosm’s founder, Professor Doyne Farmer, and Sophia to learn more about the ‘supersimulator’ Prof. Farmer discussed in a recent Guardian article. While still early on, this new class of technology shows real promise in helping climate policymakers and institutions better navigate the complexity of the energy transition.

This conversation explores how modeling the real economy – firm by firm, shock by shock – could finally give policymakers and institutions the tools to navigate and steer the climate transition.

Q1. Your Guardian piece opens with a striking claim: economics has failed on the climate crisis. That's a bold charge. What's the evidence?

Doyne: The track record is genuinely terrible – and I can speak to it personally. In 2010, I predicted that solar would be cheaper than coal by 2020. We were right. The integrated assessment models, meanwhile, were off by a factor of six in their estimate of how fast costs would decline. For two decades, they consistently predicted renewables would roll out slowly and costs would fall gently. Solar costs collapsed by more than 90% in a decade. Wind followed close behind. If you had used those forecasts to set climate policy, you would have dramatically underinvested in the transition.

These models failed because they ignored what the data clearly showed: that as deployment grows, costs fall predictably because experience accumulates. This is Wright's Law, and it goes well beyond simple economies of scale. But correcting for that raises a deeper question: what actually drives deployment? That depends on the decisions of millions of individual firms, each responding to prices, competitors, and policy. Look at what happened when China stepped into the solar market. Deployment scaled so fast that costs plunged far beyond what anyone predicted, and the same is now happening with batteries and EVs. But standard models can't see any of these dynamics. And that's before you even get to how shocks propagate through those firms. That's where agent-based models become essential.

Q2. You've spent decades developing a complexity economics and agent-based modeling approach. What does that actually mean, and why does it produce a more honest picture of how economies work?

Doyne: The core idea is simple: stop pretending economies reach equilibrium and model what actually happens. Millions of firms and households making boundedly rational decisions, interacting with each other, producing outcomes nobody planned.

Counterintuitively, this becomes more tractable, not less. Agent-based models simulate each agent individually with realistic behavioral rules and let aggregate behavior emerge. Agents learn and adapt as the world changes – and because the whole system is represented from the bottom up, you can see how a shock in one part propagates through every other. The cascading impact becomes visible.

Covid proved it. Standard models assume equilibrium – supply equals demand. The pandemic shattered both simultaneously: demand collapsed as consumers retreated, supply collapsed as industries shut down, and the two shocks collided and amplified through supply chains. No equilibrium model could track that. We mobilized a team overnight, built a model that could, and predicted a 21.5% GDP contraction. The actual figure was 22.1% – and we significantly outperformed the Bank of England and several others.

Sophia: Whether you’re an infrastructure investor assessing transition risk or an insurer pricing supply chain exposure, it means you're finally working with a model that represents the firms you're actually exposed to, not sector averages. And that produces something the existing tools can't: traceability. 

When this approach shows that a critical mineral bottleneck delays battery production across three countries, you can trace every assumption behind that number: the supplier relationships, the inventory buffers, the cascade pathway. That audit trail is what regulators and boards are increasingly demanding – and it's something neither statistical models nor LLMs can produce. The decisions that will define the transition are too consequential to rest on black boxes.

Q3. Give us a concrete example of what Macrocosm’s platform can answer that today's tools simply cannot?

Doyne: Our first step toward modeling the whole economy is the energy system: all 30,000 energy companies and their 160,000 assets. Every power station, every wind farm, every generator is a separate agent making decisions about output, investment, and pricing. We're literally modeling the adaptive decision-making of every energy company in the world to see how much each delivers and at what price. It matters because the transition isn't about swapping one technology for another. When a utility invests in solar, it changes the economics for every other player. But standard models can't see that, and so they optimize one imaginary company standing in for the whole sector.

The same applies to supply chains, and the Hormuz crisis is showing that in real time. A standard model gives you a sector-level GDP impact – a single number, weeks later. It can't tell you which firms exhaust critical inventories first, how the shortage cascades through downstream production, or how much larger the total loss becomes than the original shock. Whether it's a power grid or a global supply chain, our platform simulates the dynamics week by week, sector by sector. It tells you not just how bad, but when. 

Sophia: That visibility changes what's possible for sustainability decision-makers. Scope 3 reporting, energy procurement, transition planning. They all depend on understanding how disruptions travel through the deeper tiers, where hidden dependencies and emissions reside. Today, most companies can't do that. An automotive manufacturer can't trace which Tier-3 components become the bottleneck when a logistics corridor is disrupted – and the insurer covering them can't see the accumulation risk across their book. Macrocosm makes those pathways visible and quantifiable for the first time.

Q4. There's a gap between a powerful academic model and something a Chief Sustainability Officer, risk manager, or policymaker can actually use on a Monday morning. How do you bridge that gap?

Doyne: These models only make a real-world impact if they're embedded in the environments where high-stakes decisions policymakers, investors, and firms are making. Taking complexity economics from the research frontier into practice is what Macrocosm is doing. Critical to building that trust is empirical validation: we backtest our work against real events, which is rarely standard practice in economic modeling. It's the same reason you trust a weather forecast: not because the data is richer, but because the underlying physics is right.

Think about what weather forecasting requires: not just better atmospheric science, but an architecture that could ingest real-time observations, update continuously, and express uncertainty in a form people could act on. That's the gap we're closing for economics. 

Sophia: And closing that gap is exactly what drew me from BCG to Macrocosm. Today, most sustainability teams work from scenario analysis that's already out of date by the time it reaches the board. The world moves; the analysis doesn't. What we're building is a tool you can interrogate as conditions change. When a new tariff shifts where your supply chain's transition risk concentrates, or grid bottlenecks delay a renewable buildout, you need to see what that means for your exposure now, not next quarter. Not a static report, but a capability you use every week. 

Q5. What would it look like — practically — if policymakers and institutions had access to this kind of simulation? What decisions change?

Doyne: We want to do for economic planning what Google Maps did for traffic planning – giving people a dynamic picture of the whole system so that they can better navigate the constantly changing world. For policymakers, that matters more now than ever, because the transition isn't happening in a vacuum. Governments are simultaneously managing energy security, industrial competitiveness, and decarbonization, and the interactions between those priorities are where the biggest policy mistakes get made.

Imagine a government stress-testing an industrial strategy and seeing not just GDP projections, but the predicted response of every firm: who invests in renewables, who holds on to fossil assets, where grid bottlenecks or critical material dependencies emerge. They can test whether a policy intervention accelerates the transition or triggers unintended knock-on effects through supply networks. They finally see who bears the cost, who adapts, and where the transition stalls.

Our research shows that a fast transition likely saves the world around $12 trillion. But that requires getting a huge number of interconnected decisions right, across energy, supply chains, and investment. No one can steer a system they can't see.

Sophia: And no institution can navigate a transition it can't map. Whether it's a border adjustment, an energy shock like Hormuz, or a critical mineral constraint – the impact rarely arrives where you expect, or when. Today, most organizations see their direct exposure but not the connections behind it. Macrocosm makes those connections visible. You can stress-test your exposure before something breaks, re-run it when policy or market conditions shift, and defend the analysis to your board or regulators. That transforms how institutions reason about the transition: not from static assumptions, but from a living model of the economy they're actually operating in.

What’s in this week’s newsletter:

1. China's EV and solar surge post-Iran war

2. Greenhouse Gas Protocol floats updates on the Scope 3 standard

3. The US budget contains even more climate cuts

4. Swiss follow Europe’s lead in simplifying sustainability policies

5. A scary super El Niño is on the way

It feels like it’s China’s world and we are all living in it right now, but thankfully, that world looks cleaner. 

The two-week ceasefire declared this week caused oil prices to plummet, however, the energy shock from the Iran war will reverberate through the global economy for some time to come. 

In the most affected nations, especially in Asia, energy rationing has been the norm for weeks, forcing a complete rethink of energy security and accelerating their transition to renewable energy. In Cuba, still reeling from a US-imposed energy blockade, they have turned to Chinese solar imports to alleviate pressure on their grid - aiming to nearly triple the number of solar parks by 2028. 

Increased gas prices have also strengthened the case for EVs. In the US, despite new EV sales dropping by more than a quarter since Trump withdrew the tax credit, used EV sales have risen by 12% this quarter compared to Q1 last year. While the US has “hermetically sealed” itself from Chinese EVs, the UK (along with almost every other market) has embraced them and has seen sales hit record highs amid skyrocketing gas prices.

All of this is benefiting China, which has been preparing for this type of geopolitical energy shock for decades. China’s largest EV maker BYD saw exports increase 65% in March this year compared to last year, and its biggest battery manufacturer CATL saw its shares jump 29.5%.

China is also improving transparency. In just a few short weeks, China’s three largest stock exchanges will become the largest exchanges to have a sustainability reporting mandate. By April 30th, more than 450 of China’s largest publicly traded companies will begin reporting sustainability data. They are also vying to capitalize on the US retreat from multilateral environmental action by becoming the first Asia-Pacific nation to host a UN body: the UN High Seas Treaty, which aims to protect 30% of the world’s oceans by 2030. China is offering streamlined visas for delegates and $70 million in investment for the project.

We may look back on the Iran war as an inflection point toward an electrified, low-carbon economy largely powered by Chinese cleantech. 

2. GHG Protocol Scope 3 Update

As regulations, like California’s climate rule, begin to mandate the disclosure of complex Scope 3 – value chain emissions, the Greenhouse Protocol (GHGP) is in the midst of updating them. As part of their broader goal of refreshing their almost 30-year-old corporate emissions standard, they recently released their first progress update for their Scope 3 Standard. 

The updates, which will be done in cooperation with the ISO, focus on three main areas:

• The quality of data: including the emissions factors to use, the level of verification, and tiered data quality to improve transparency and accuracy.

• Expansion of boundaries: requiring reporters to accurately report at least 95%, while using estimates to quantify 100% of Scope 3 to verify that any exclusions do not exceed the 5% threshold.

• Changes to category 15 - (investment): updating the calculation methodology to align with the Partnerships on Carbon Accounting Financial (PCAF) guidance, and creating a new optional category (category 16) for “insured emissions.”

This document provides the direction of travel on the updates to the new Scope 3 guidance, but is subject to change before the final release of a draft and a subsequent public consultation period later in the year.

3. Trump’s Budget Cuts Climate Spending Further

In its first budget, the Trump Administration slashed dozens of sustainability and climate programs. While some, like the Energy Star program, were rescued due to bipartisan support, many were eliminated. In the second budget released last Friday, the cuts to climate programs went further still. 

The biggest change in this year's 92-page budget is an unprecedented 44% increase in military spending to $1.5 trillion. To cover the increased spend, the administration will:

• Cut the already crippled Environmental Protection Agency budget in half.

• Cancel “green new scam” funding in the Infrastructure Investment and Jobs Act

• Reduce funding for specific energy efficiency and renewable energy programs

• Eliminate funding for climate change and “green new scam” research

There are dozens more, which, all told, add up to at least $30 billion in cuts to social, environmental, disaster recovery, and clean energy programs. Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said the budget was “unserious,” adding, “This budget is not only two months late, but it is also light on details and heavy on borrowing.”

4. Swiss Align with the EU Simplification

The Swiss Government this week announced new rules almost verbatim with Europe’s simplified Corporate Sustainability Due Diligence Directive (CS3D) and Corporate Sustainability Reporting Directive (CSRD). The Swiss Corporate Sustainability Act updates Swiss rules to align with the scope and requirements of the EU rules following the Omnibus simplifications. 

These updates reduce the number of Swiss companies that have to report on sustainability from 230 to 100, and the number of companies that conduct due diligence to 30.

5. A Super El Niño

With all the geopolitics, climate backlash, and shifting standards and regulations, it’s easy to forget about the quickly encroaching climate crisis. Then a story or event brings it back into focus. This week, chatter of a super El Niño that could be “perhaps the strongest yet,” did just that. 

Following a report this week showing that non-survivable heat waves are on the rise, news of a super El Niño, characterized by temperatures more than 2°C above average (a typical El Niño is just a 0.5°C average temperature rise), means 2026 will see climate risks similar and likely worse than the last one with extreme temperatures, widespread flooding, and crop loss.

The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer. 

Other Notable News:

Sustainability Standards

• The Partnership of Carbon Accounting Financials (PCAF) released an annual impact report revealing that the standard is now used by 719 financial institutions, representing nearly $100 trillion in assets.

Climate Litigation

• This week, Utah passed a law that shields fossil companies from legislation or lawsuits that force them to pay for damages from climate change. Republicans are also working on a federal one.

• A suspect was extradited from the UK to the US this week for running a hacking campaign on behalf of a Washington lobbying group aimed at halting environmental groups' lawsuits against oil and gas companies.

Energy Transition

• New research from the International Renewable Energy Agency found that solar accounted for 511 GW of the record 692 GW of renewable capacity added last year. 

• China’s largest battery company, CATL, is attempting to move into shipping and electrify many of the smaller ships in global shipping.

• Turkey is racing ahead of its European neighbors in battery and solar adoption, adding almost three times the solar generation as Germany since 2022.

Trump 2.0

• The Forest Service is shutting down two-thirds of its research facilities, with scientists saying climate and wildfire research could be lost.

COP 33

• India quietly removed itself from hosting COP33 in 2028 without a clear reason, opening the door for South Korea to host it.

Notable Podcasts: 

• In this week’s edition of the Two Steps Forward podcast from Solitaire Townsend and Joel Makower, they look at the role of insurance in sustainability. They speak with Linda Freiner, Group Chief Sustainability Officer at Zurich Insurance Group, on just how important insurance is in the global economy and how sustainability-related risks are straining the model.

• In this week’s Outrage and Optimism, the team explores the implications of the forecasted Super El Niño. They talk to Andrew Kruczkiewicz from the Red Cross to discuss how we square the circle of shrinking budgets and accelerating climate risks.