Americas
CARB Holds Public Workshop on California SB 253
On March 23, the California Air Resources Board (“CARB”) held a public workshop on SB 253, the Climate Corporate Data Accountability Act. During the workshop, CARB staff discussed, for 2027, developing templates for Scope 1 and Scope 2 reporting and considering potential approaches to Scope 3 reporting requirements. CARB staff also discussed proposed methods for determining organizational boundaries, greenhouse gas (“GHG”) accounting and assurance standards under the law. Although litigation concerning SB 253 and SB 261, the Climate-Related Financial Risk Reporting Act, remains ongoing, currently in-scope entities are obligated to submit their initial SB 253 reports by August 10, 2026. CARB is soliciting public feedback on the rulemaking concepts discussed during the workshop, and has launched a public comment link for stakeholders to submit comments by June 1, 2026.
Activist Investors Sue the SEC Over No-Action Process
On March 19, two activist investors sued the U.S. Securities and Exchange Commission (“SEC”) over changes to the “no-action” request process that companies typically use when seeking to exclude shareholder proposals from proxy materials. In November 2025, the SEC announced that it would not respond to no-action requests pursuant to Rule 14a-8 of the Securities Exchange Act of 1934, except those made under Rule 14a-8(i)(1) (as to whether the shareholder proposal is a proper subject under state law). The investor plaintiffs claim that this policy change violates the Administrative Procedure Act because it is arbitrary and capricious, and because the SEC did not follow proper rulemaking procedures when adopting the policy. The plaintiffs also allege that the new policy is inconsistent with Rule 14a-8 by effectively removing the requirement that companies demonstrate proper exclusion of shareholder proposals.
Energy Company Agrees to Terminate All Offshore Wind Leases
On March 23, the U.S. Department of the Interior announced an agreement with a large international energy company whereby the company will terminate its offshore wind development plans and redirect funding toward oil, natural gas and liquefied natural gas production in the U.S. As part of the agreement, (i) the Department of the Interior will repay the energy company for any offshore wind lease payments already paid, (ii) the company commits to reinvesting an equivalent amount into U.S.-based oil and gas energy projects and (iii) the company pledged not to develop any new offshore wind projects in the U.S. The Department of the Interior indicated that the agreement is aligned with a broader policy approach of increasing domestic energy production and reliability, and is seeking to support dependable power supply and energy affordability.
New Executive Order on Diversity, Equity & Inclusion Discrimination
On March 26, President Trump issued Executive Order 14398, Addressing DEI Discrimination by Federal Contractors, aimed at eliminating diversity, equity and inclusion (“DEI”) in federal contracting. The order requires federal contractors and subcontractors to include specified “anti-DEI” language in their contracts and authorizes federal agencies to investigate covered contracts within 30 days. If a contractor does not comply, the contracting agency may cancel, terminate or suspend the contract. The order also directs the Attorney General to consider whether noncompliance may give rise to liability under the False Claims Act (“FCA”), which imposes penalties for false statements or fraudulent claims made to the government. Relatedly, on April 10, a large government contractor agreed to pay approximately $17 million to the U.S. Department of Justice (“DOJ”) to resolve allegations that it falsely certified compliance with federal anti-discrimination requirements while maintaining discriminatory employment practices. The settlement, the first FCA resolution under the DOJ’s Civil Rights Fraud Initiative, suggests increasing use of the FCA to pursue alleged civil rights violations tied to DEI-related employment practices.
Coalition of States and Cities Sue EPA Over Endangerment Finding
On March 19, a coalition of 39 states and cities sued the U.S. Environmental Protection Agency (“EPA”) over its rescission of the GHG endangerment finding, which had been in place since 2009 and served as the basis for the EPA’s statutory authority under the Clean Air Act to regulate GHG emissions across multiple sectors, including from motor vehicles and power plants. The challenge follows a similar lawsuit brought by a coalition of health and environmental groups and seeks the court’s review of the final action by the EPA to rescind the endangerment finding.
EU/U.K.
Regulation on 2040 EU Climate Targets Published in the Official Journal
On March 18, the European Union published Regulation (EU) 2026/667 of the European Parliament and of the Council of 11 March 2026 in the Official Journal. The Regulation amends Regulation (EU) 2021/1119 regarding the establishment of a legally binding European Union intermediate climate target for 2040. Under the new regulation, the EU must achieve a 90% net reduction in GHG emissions by 2040, compared to 1990 levels. The new Regulation reinforces the EU’s trajectory toward 2050 climate neutrality, while reshaping the policy architecture for the post-2030 period. It introduces limited flexibility by allowing the use of high-quality international carbon credits (contributing up to 5% of the 2040 target) and strengthens the role of carbon removals and monitoring mechanisms.
EU’s Platform on Sustainable Finance Publishes Recommendations on Revised ESRS
On March 16, the Platform on Sustainable Finance, an advisory body to the European Commission, published its response to the European Commission’s consultation regarding possible changes to the European Sustainability Reporting Standards (“ESRS”). In its response, the Platform recommends simplifying the ESRS, adding more datapoints, clarifying exemption requirements and drawing a clearer line between mandatory and voluntary disclosures. The Platform also emphasizes the importance of maintaining robust environmental and transition-related disclosures, ensuring continued alignment with the EU Taxonomy and climate objectives. Finally, it calls for greater interoperability with international reporting standards to help reduce the burden on companies that report in multiple jurisdictions.
ESMA Releases Report Outlining Regulatory Impact on Retail Investors
On March 12, the European Securities and Markets Authority (“ESMA”) published its final report following a May 2025 Call for Evidence on key aspects of the investor experience, with a particular focus on how the MiFID II regulatory requirements impact retail investors participating in capital markets. Regarding sustainability, ESMA confirmed that it will support the European Commission to simplify and improve the MiFID II requirements on sustainability. In particular, ESMA intends to: (i) significantly simplify the definition of “sustainability preferences,” aiming to link them (where possible) to any new product categories developed under the SFDR review; (ii) reduce the operational complexity in the entire cycle of collection, adaptation and update of client sustainability preferences; and (iii) support financial education efforts on relevant sustainability-related topics.
Finland Adopts Resolution on Ecological Targets for Public Procurement
On March 12, the Finnish Government issued a Government Resolution on Strategic Ecological Targets for Public Procurement, guiding contracting authorities to reduce the environmental impacts of procurement across the full lifecycle of products, services and works. The targets are aligned with international environmental commitments and EU goals on climate, nature and circular economy. The Resolution also sets reduction targets through 2035, measured against national baseline years of 2019 for carbon footprint and 2022 for nature footprint, with each contracting authority determining its own implementation measures. The Resolution identifies the public purchasing categories with the most significant impact, such as construction, transport and vehicles, food and catering services, certain social and health care services and information and communications technology. The Resolution is binding on state contracting authorities, and the Finnish Government also recommends that other public contracting authorities follow the same targets and principles.
Information provided by contributing law firm: Krogerus
APAC
South Korea Updates Taxonomy Guidance
On April 1, the Ministry of Climate, Energy and Environment announced the publication of a revised guide to the K-Taxonomy, together with a new linkage table aligning each taxonomy activity with the Korean Standard Industrial Classification (“KSIC”). The revision reflects the amendments to the K-Taxonomy Guidelines in December 2025, including newly added and revised economic activities, and provides more detailed guidance on the definition and scope of activities, as well as on the application of the technical screening criteria, exclusion criteria, minimum safeguards and other key considerations. The KSIC linkage table covers all 100 K-Taxonomy economic activities and maps them to the 11th revision of the KSIC down to the sub-subclass level, with the aim of promoting greater consistency in lending, investment review and green finance disclosures.
Information provided by contributing law firm: Yoon & Yang LLC
China Advances Environmental Enforcement and Codification
On March 27, the Supreme People’s Court and Supreme People’s Procuratorate strengthened criminal enforcement by broadening liability for tampering with environmental monitoring data, refining leniency rules and clarifying false-certification offenses in the environmental sector. On March 12, the National People’s Congress adopted the Ecological and Environmental Code, effective August 15, 2026. The Code consolidates and replaces ten existing environmental laws, elevates “green and low-carbon development” into a standalone framework, and turns China’s dual carbon goals—that is, carbon peaking before 2030 and carbon neutrality by 2060—into binding legal obligations. It also expands pollution regulation to emerging issues, including chemical substances, electromagnetic radiation, light pollution, cooking fumes and odor, while imposing enterprise-wide environmental obligations across the full business lifecycle and promoting compliance through incentives such as green credit, tax benefits and preferential procurement to promote the circular economy.
Information provided by contributing law firm: Global Law Office
Australian Court Dismisses Greenwashing Litigation
On March 17, the Australasian Centre for Corporate Responsibility (“ACCR”) appealed a Federal Court of Australia decision that dismissed its greenwashing case against energy company Santos Ltd (Australasian Centre for Corporate Responsibility v Santos Ltd [2026] FCA 96). In that earlier decision, the Court rejected ACCR’s claims that Santos had misled the public through statements, including that its natural gas provided “clean energy,” and that it would be able to produce “clean” or “zero-emissions” hydrogen in the future and statements relating to its 2040 net zero targets. The Court found that, when read in context and from the perspective of investors, these statements were not misleading or deceptive. In relation to climate targets, the Court considered the language Santos used in its communications, evidence concerning Santos’ scoping and forecasting and accepted that climate-related technologies evolve and that long-term targets included assumptions beyond Santos’ control.
Information provided by contributing law firm: Mallesons
Standards and Associations
GRI Releases Proposed Pollution Disclosure Standards
On March 30, the Global Reporting Initiative (“GRI”) released a new series of research drafts illuminating the impacts of pollution on individuals, communities and the environment. The research drafts call for strengthened corporate reporting on pollution impacts and management, covering both air and soil pollution, as well as critical incidents such as oil spills. GRI invites global stakeholders to provide feedback before June 8, 2026, with the intention to publish the final set of Pollution Standards in 2027.
Net-Zero Asset Owners Alliance Issues Updated Guidance
On March 16, the Net-Zero Asset Owners Alliance (“NZAOA”) published the Target-Setting Protocol Fifth Edition introducing regional flexibility to adapt global targets to diverse local markets, reinforcing incentivization for asset manager engagement and updating KPIs to enhance target-setting and stewardship practices. Additionally, the updated guidance includes a quantitative investment target for climate solutions, focusing on funding green transition technologies, and a new “transition target” category to support high-emitting companies with credible net-zero plans.
Contributing Law Firm Information
Global Law Office | Krogerus | Mallesons | Yoon & Yang LLC