Americas
CARB Delays GHG Reporting Under SB 253 and Announces Public Workshop
On June 24, the California Air Resources Board (CARB) announced a three-month delay of the initial reporting deadline under SB 253 (the Climate Corporate Data Accountability Act) requiring in-scope entities to report Scope 1 and Scope 2 greenhouse gas (GHG) emissions relating to 2025. The delay shifts the compliance date from August 10, 2026 to November 10, 2026. In addition, CARB stated that it intends to propose limited changes to its implementing regulation. Scope 3 reporting under the law currently remains on track to begin in 2027. CARB also announced that it will hold a virtual public workshop on July 21 to discuss regulatory concepts for Scope 1 and Scope 2 reporting requirements for 2027 and beyond, including data assurance and CARB’s proposed approach for Scope 3 emissions reporting. Registration for CARB’s workshop is available here.
New York Governor Imposes Statewide Data Center Moratorium
On July 14, New York Governor Kathy Hochul signed an executive order imposing the nation’s first statewide moratorium on large-scale data center construction. The order, which takes effect immediately, directs the Department of Environmental Conservation not to issue discretionary permits for new data centers with a power demand of 50 megawatts or more for up to one year while state regulators develop a comprehensive regulatory framework. During the pause, the Department of Public Service will prepare a Generic Environmental Impact Statement to establish consistent standards for evaluating proposed data centers’ effects on energy demand, water use and quality and air quality. The executive order does not affect projects that have already received permits. Separately, the state legislature passed its own one-year moratorium bill in June—targeting data centers above 20 megawatts—which has not yet been signed into law.
Two State Courts Issue Preliminary Injunctions in Favor of ISS and Glass Lewis
On June 24, a Kansas federal judge entered a preliminary injunction in favor of proxy advisors Institutional Shareholder Services (ISS) and Glass Lewis against Kansas Senate Bill 375 (SB 375), preventing the Proxy Advisor Transparency Act from going into effect on July 1. The law would have required proxy advisors to disclose a written financial analysis—or publicly state that none existed—when recommending votes contrary to company management’s recommendation. In granting the preliminary injunction, the federal judge reasoned that the plaintiffs were likely to succeed on the merits of the case, finding that SB 375 discriminates based on viewpoint in violation of the First Amendment because the disclosure obligations are triggered only when recommendations oppose management’s position.
Four days later, on June 28, a federal judge in the Southern District of Indiana entered a preliminary injunction in favor of ISS and Glass Lewis, blocking Indiana House Bill 1273 (HB 1273), a similar law regulating proxy advisors’ activity, on the same First Amendment grounds. Indiana’s law is similarly stayed and was prevented from taking effect on July 1.
EEOC Rescinds Affirmative Action Guidelines
On June 30, the U.S. Equal Employment Opportunity Commission (EEOC) voted to rescind its Affirmative Action Interpretive Guidelines and the related Compliance Manual on Affirmative Action, which provided guidance to employers regarding lawful voluntary affirmative action measures. The Commission stated that the guidelines, which were created in 1979, were inconsistent with the text of Title VII and contradicted Supreme Court case law that has developed in the four decades since their adoption. The rescission eliminates the EEOC’s longstanding framework for evaluating voluntary affirmative action plans and removes the agency safe harbor that employers previously relied on when implementing employment practices in good-faith conformity with the guidance. The rescission follows the EEOC’s recently announced Enforcement Plan and is consistent with the agency’s broader enforcement priorities targeting DEI programs and initiatives within the private sector.
Republican AGs Sue California Over Packaging EPR Law
On June 22, a coalition of 17 Republican state attorneys general, led by Nebraska Attorney General Mike Hilgers, filed a federal lawsuit challenging California’s Senate Bill 54, the Plastic Pollution Prevention and Packaging Producer Responsibility Act, which sets minimum content requirements for single-use packaging and single-use plastic food service ware and establishes an extended producer responsibility (EPR) program. The National Association of Wholesaler-Distributors (NAW) joined as the sole business plaintiff. The lawsuit alleges that the law constitutes “unprecedented overreach,” unlawfully interferes with interstate commerce in violation of the Commerce Clause and raises First Amendment concerns by compelling producers to fund and associate with a private organization. The coalition is seeking to block enforcement of the law, which came into force on May 1, 2026, and which established one of the nation’s most expansive EPR programs for packaging.
U.S. Customs and Border Protection Publishes New Forced Labor Enforcement Operational Guidance for Importers
On June 12, U.S. Customs and Border Protection (CBP) issued comprehensive new Forced Labor Enforcement Operational Guidance for Importers. The expanded 79-page guidance consolidates, for the first time, CBP’s enforcement framework under three distinct legal authorities: the Uyghur Forced Labor Prevention Act (UFLPA), the Countering America’s Adversaries Through Sanctions Act (CAATSA), and the general forced labor import prohibition under 19 U.S.C. § 1307. It supersedes CBP’s prior 2022 UFLPA guidance and provides step-by-step instructions on responding to detentions, exclusions and seizures. The guidance also provides recommended supply chain documentation for high-priority sectors (e.g., cotton, tomatoes, polysilicon, apparel, aluminum and seafood). As of early 2026, 69,415 shipments valued at $3.94 billion have been subjected to forced labor enforcement actions since the UFLPA took effect in 2022.
Judge Vacates DOE’s Cancellation of Clean Energy Grants
On June 11, a federal judge in the U.S. District Court for the District of Columbia vacated the Department of Energy’s (DOE) decision to terminate 11 clean energy grants totaling $82.1 million that had been awarded during the Biden administration. The grants, issued by the DOE’s Office of Energy Efficiency and Renewable Energy, funded projects focused on energy efficiency, critical minerals reclamation and hydrogen technologies in Connecticut, New York, Colorado, Minnesota and Oregon. A coalition of grant recipients challenged the cancellations, arguing that the DOE targeted grantees based on the political affiliation of the states in violation of the Fifth Amendment’s equal protection guarantees. The DOE stipulated that a primary reason for the terminations was the grantees’ location in blue states. The ruling follows a January 2026 decision in a related case ordering the DOE to reinstate seven grants worth $28 million.
House of Representatives Introduces AI Data Center Moratorium Act
On June 24, lawmakers in the House of Representatives introduced the Artificial Intelligence Data Center Moratorium Act (H.R. 9442), which would impose an immediate federal moratorium on the construction of new data centers or upgrades to new or existing data centers with a power demand in excess of 20 megawatts until Congress passes comprehensive legislation addressing the economic, environmental and safety impacts of artificial intelligence. The legislation seeks to ensure that AI data centers do not increase consumers’ utility or electricity bills and that they do not exacerbate the threat of climate change or harm the environment.
Colombia Enforces Mandatory Disability-Inclusion Employment Quotas
On June 25, the disability-inclusion hiring obligation under Law 2466 of 2025 became fully enforceable. Companies with more than 100 employees must hire at least two people with disabilities per 100 workers. Employers must register qualifying hires through the official disability certification and Colombia’s official registry that tracks and characterizes the location and health status of citizens with disabilities, with compliance verified by the Ministry of Labour.
Information provided by contributing law firm: Cuatrecasas
EU/U.K.
EU Commission Adopts Revised European Sustainability Reporting Standards
On July 3, the European Commission adopted the revised European Sustainability Reporting Standards (ESRS) and a voluntary reporting standard for smaller companies. The revised standards, which build on the Omnibus I simplification package, reduce mandatory data points by over 60% and total data points by over 70%, and are expected to lower reporting costs by over 30% per company. The voluntary standard provides a proportionate reference framework for companies outside the CSRD’s scope and introduces a value-chain cap, preventing CSRD-reporting companies from requiring value chain partners to provide information beyond that covered by the voluntary standard. Both measures have been submitted to the European Parliament and Council for scrutiny and will apply once the two-month scrutiny period, which may be extended by a further two months, has ended.
U.K. Government Announces New Deforestation Due Diligence Framework
On June 23, the U.K. Government announced plans to introduce a mandatory due diligence framework in Great Britain to address illegal deforestation in global supply chains. Building on the existing U.K. Timber Regulation, the plans would require U.K. businesses with annual turnover exceeding £1 million that use forest risk commodities—including wood, cattle, cocoa, coffee, palm oil, rubber, soy and certain derived products—to carry out due diligence to ensure compliance with relevant local laws. Businesses would need to establish due diligence systems, report on their activity and collect geolocation data on product origins. The framework aims to operate consistently alongside the EU Deforestation Regulation (EUDR) to support the U.K. internal market and export-led growth. Legislation implementing the regime is expected in 2027.
EU Pay Transparency Directive Enters Into Force
On June 6, the EU Pay Transparency Directive (EU) (2023/970) entered into force and must be transposed into national law by Member States by June 7, 2026, with first reports due in 2027 covering calendar year 2026. The Directive requires companies with more than 250 employees to report annually on gender pay gaps, while companies with 100-250 employees must report every three years. Employers must disclose salary ranges in job advertisements, are prohibited from asking candidates about salary history and must provide employees with information on average pay levels by sex upon request. Where pay gaps exceed 5% and cannot be justified by objective, gender-neutral criteria, companies must conduct joint pay assessments with workers’ representatives. Non-compliance carries significant consequences, including a reversed burden of proof on employers, entitlement to full compensation for affected employees and fines.
Hungary Institutes New ESG Consultant Qualification Requirements
Beginning on July 1, all applicants for ESG consultant accreditation, as well as all currently accredited ESG consultants, must obtain an ESG Consultant Qualification through a training program provided by an institution accredited by the Hungarian Economic Development Agency. The qualification must be submitted to the supervising authority, which may remove from its register any accredited ESG consultant who fails to submit proof of qualification. If a deregistered individual consultant was one of the accredited ESG consultants required for a legal entity’s ESG consultant accreditation, the deregistration may also affect the legal entity’s accreditation.
Information provided by contributing law firm: Gárdos Mosonyi Tomori
Italy Implements Joint Guidelines of the European Supervisory Authorities on ESG Stress Testing
On July 3, the Bank of Italy notified the European Banking Authority (EBA) of its intention to comply with the Joint Supervisory Guidelines of the three European Supervisory Authorities on ESG stress testing. The Guidelines, which apply from January 1, 2027, aim to ensure common standards in ESG risk assessment methodologies pursuant to Article 100(4) of the Capital Requirements Directive (CRD–Directive 2013/36/EU) and Article 304c(3) of Solvency II (Directive 2009/138/EC). The Guidelines are directed at competent supervisory authorities (CA) and are intended to ensure that they integrate ESG risks into their stress-testing exercises in a consistent manner. CAs will have to consider two possible types of stress-testing exercises based on the objectives they intend to pursue. The first is an exercise aimed at assessing the resilience of supervised entities’ capital and liquidity positions against macro-financial shocks, including ESG risks, over a short-term horizon of up to five years. The second is an exercise aimed at assessing the resilience of supervised entities’ business models against a variety of ESG scenarios over a long-term horizon of at least 10 years.
Information provided by contributing law firm: Gianni & Origoni
Germany Advances Environmental Litigation Reform
On June 25, the Bundestag (the federal parliament of Germany) adopted an Act amending the Environmental Appeals Act (UmwRG) and other environmental legislation. The reform streamlines environmental litigation to accelerate infrastructure and other development projects, while aligning German law with EU law and the Aarhus Convention. Under the Act, environmental lawsuits would no longer automatically block project implementation, and legal challenges against energy, transport, telecommunications and climate-related projects would not suspend permits during litigation. Claimants would face a strict ten-week deadline to present their case after filing suit, and for recognized environmental organizations, standing would be tied more closely to their substantive and geographic scope of recognition. The Act must still complete the remaining legislative process before entering into force.
Information provided by contributing law firm: Gleiss Lutz
Two French Court Decisions Target Greenwashing and Climate Risk Disclosure
On June 23, the Paris Judicial Court found bottled water company Volvic liable for “misleading commercial practices” and ordered the company to pay EUR 75,000 in damages and EUR 10,000 in legal costs to a consumer protection association. The court held that the claims “carbon neutral” and “100% recycled” were misleading because they were scientifically inaccurate. Separately, on June 25, the Paris Judicial Court found TotalEnergies in breach of its duty of vigilance and ordered it to include Scope 3 emissions, including those generated by the combustion of products sold to its customers, in its risk mapping. Under the ruling, the company must, within six months, publish a new vigilance plan incorporating updated climate risk mapping and appropriate measures. A hearing is scheduled for January 21, 2027, at which the court may issue further orders if the measures are deemed insufficient.
Information provided by contributing law firm: Gide Loyrette Nouel A.A.R.P.I
Iceland Amends Act on Equal Status and Equal Rights of Genders
On June 18, Althingi, the national parliament of Iceland, approved Act No. 53/2026, amending the Act on Equal Status and Equal Rights of the Genders, No. 150/2020. The Act is intended to address concerns regarding the cost of implementing equal pay certification and maintaining equal pay confirmation, while preserving the principles of equal pay and equality in the labor market and preventing discrimination on the basis of gender. The main changes include: (i) abolishing equal pay certification and replacing it with mandatory equal pay reporting; (ii) narrowing the scope of application to workplaces with 50 or more employees, rather than 25 or more employees, while continuing to apply to all government ministries regardless of size; and (iii) requiring employers to submit objective job classifications, pay analyses and timed improvement plans to the Icelandic Directorate of Equality every three years. The Act takes effect on September 1, 2026, with specific transition periods for currently certified entities.
Information provided by contributing law firm: Lagahvoll
APAC
South Korea Finalizes Mandatory Sustainability Disclosure Roadmap
On July 8, South Korea’s Financial Services Commission announced the final roadmap for mandatory sustainability disclosure. The requirement will apply first to the Korea Composite Stock Price Index listed companies with KRW10 trillion or more in total consolidated assets from 2028, based on FY2027, and will expand to companies with KRW5 trillion or more from 2029, with a potential further expansion to KRW2 trillion from 2030. ESG disclosures will be filed through corporate business reports under the Financial Investment Services and Capital Markets Act. During the first three years, companies will receive broad relief from civil, administrative and criminal liability for sustainability disclosures, except in cases of intentional greenwashing. Third-party verification will become mandatory from 2030, while Scope 3 emissions disclosure will be deferred by three years for each category of covered companies. The initial mandatory standards will focus on climate-related disclosures, with other ESG topics remaining voluntary.
Information provided by contributing law firm: Yoon & Yang
Vietnam Establishes First Legal Framework for Forest Carbon Credits
On July 15, Vietnam’s Decree No. 180/2026/ND-CP takes effect, establishing the country’s first comprehensive framework for forest carbon sequestration and storage services, including the creation, management and transfer of emission-reduction results and forest carbon credits. Eligible activities include forest protection, reduced deforestation, restoration, afforestation, enrichment and certain agroforestry models. Credits may be issued only after a project is formulated, registered and verified through measurement, reporting and verification (MRV) under recognized methodologies. The Ministry of Agriculture and Environment is also drafting national standards for carbon projects, MRV, appraisal, verification and safeguards.
Information provided by contributing law firm: Le & Tran
Pakistan Securities and Exchange Commission Issues First ESG Mutual Funds Framework
On July 1, the Securities and Exchange Commission of Pakistan (SECP) issued the country’s first ESG Mutual Funds Framework, creating a regulated pathway for asset management companies to launch ESG-labeled mutual funds. The framework requires ESG funds to invest at least 50% of net assets in ESG-aligned investments, thus reducing the 70% threshold originally proposed in the April 2026 consultation, to ensure fund integrity while mitigating greenwashing risks. Under the framework, equity-based ESG mutual funds will primarily invest in companies included in the Pakistan Stock Exchange’s Sustainability Index and those aligned with the SECP’s ESG Disclosure Guidelines. The SECP stated that the framework is intended to bring Pakistan’s capital market in line with global sustainable investment practices.
Standards and Associations
ISO Launches Public Consultation on First International Standard for Net Zero
On June 17, the International Organization for Standardization (ISO) launched a 12-week public consultation on the Net Zero Aligned Organizations Standard (ISO 14060)—the world’s first international, independently verifiable standard designed to support organizations in developing credible net zero transition plans. The draft standard was developed over two years by the ISO’s largest working group and provides global guidance for organizations navigating the transition to net zero. The consultation invites governments, businesses, researchers and civil society to submit comments through their national standards bodies, with national consensus positions due by early September 2026.
Contributing Law Firm Information
Cuatrecasas | Gárdos Mosonyi Tomori | Gianni & Origoni | Gleiss Lutz | Gide | Lagahvoll | Yoon & Yang LLC | Le & Tran