3 April – 3 May 2026
Link to Introduction Introduction
ESG is changing the landscape for financial institutions as stakeholders, including investors, increasingly expect them to make their operations more sustainable.
Financial services regulators also view ESG as a priority, embedding the principles of climate-related financial risks into their supervisory frameworks and dealing with greenwashing issues.
There is limited uniformity in regulation as financial services regulators are at different stages in developing their ESG regulatory framework, particularly in relation to disclosures and taxonomy, which is a challenge for many institutions operating across borders. It is therefore critical to monitor the latest regulator updates.
To help you, we have tracked ESG regulatory developments from 3 April 2026 – 3 May 2026, from the UK, France, EU, the Netherlands, the US, Australia as well as other key international regulators.
Link to This month’s highlights This month’s highlights
Navigating the ESG Regulatory Patchwork: A Growing Challenge for Compliance
International firms operating across multiple jurisdictions face an increasingly complex web of ESG regulations that are difficult — and at times impossible — to reconcile. As the United Kingdom, the European Union, and the United States each pursue distinct regulatory philosophies, compliance departments find themselves caught in the crossfire of overlapping, and occasionally contradictory, obligations.
In the UK, the Financial Conduct Authority has introduced stringent anti-greenwashing rules alongside broader conduct requirements designed to ensure that sustainability claims are fair, clear, and not misleading. Firms marketing financial products or services must substantiate their green credentials with rigorous evidence, and the regulatory tone is firmly interventionist. Across the Channel, the EU’s Corporate Sustainability Reporting Directive (CSRD) imposes a sweeping double-materiality framework, requiring companies to disclose not only how sustainability risks affect their business, but also how their operations impact the environment and society at large. The volume and granularity of data demanded under the CSRD represent a significant step beyond most existing reporting regimes. Meanwhile, in the United States, ESG regulation remains politically fractured. Federal initiatives, such as the Securities and Exchange Commission’s climate disclosure proposals, have met fierce resistance, and a patchwork of state-level rules — some supportive, others openly hostile to ESG considerations — adds further uncertainty.
For compliance departments, the practical difficulties are acute. Teams must interpret and operationalise frameworks that differ not merely in detail but in underlying philosophy. A disclosure strategy designed to satisfy CSRD requirements may generate content that is scrutinised differently under UK anti-greenwashing standards or that attracts political risk in certain US states. Data collection and assurance processes must be flexible enough to serve multiple reporting lines simultaneously, yet robust enough to withstand regulatory challenge in each jurisdiction. Resource constraints compound the problem: recruiting and retaining staff with the cross-jurisdictional expertise needed to manage these obligations is an ongoing struggle.
Ultimately, the absence of meaningful international harmonisation means that compliance is not simply a matter of meeting the highest standard and assuming coverage elsewhere. Firms must instead maintain parallel workstreams, each tailored to the specific expectations of its respective regulator — a burden that shows little sign of easing.
Link to United Kingdom United Kingdom
There have been no reported updates this month.
Link to European Union European Union
21 April 2026 – European Commission adopts Delegated Regulation on RTS specifying the measures and safeguards to be implemented by ESG rating providers
The European Commission (Commission) adopted a draft Commission Delegated Regulation supplementing Regulation 2024/3005 (ESG Rating Regulation) with regard to regulatory technical standards (RTS) specifying the measures and safeguards to be implemented by ESG rating providers to separate their ESG rating activities from their other activities.
The structure of the draft Commission Delegated Regulation is as follows:
- Article 1 sets out that all ESG rating providers should put in place separate organisational structures and working environments for employees and other persons involved in the rating process from any of the activities listed in Article 16(1) of the ESG Rating Regulation, and subject them to regular self-declarations attesting employees’ non-involvement in such activities.
- Article 2 proposes that ESG rating providers intending to provide investment services and/or insurance and reinsurance activities implement additional technical and internal control measures.
- Article 3 provides that, ESG rating providers that intend to provide benchmarks, or do provide such benchmarks, are to adopt additional specific safeguards ensuring that employee compensation remains unaffected by conflicts of interest related to benchmark activities, that ESG ratings are produced and offered independently of the provision of benchmarks, and that any actual or potential conflicts of interest are assessed and documented before entering into a contract for the provision of ESG rating activities.
The draft Commission Delegated Regulation enters into force on the twentieth day following its publication in the Official Journal of the European Union (OJ). It applies from 2 July 2026.
21 April 2026 – European Commission adopts Delegated Regulation on RTS specifying the elements of ESG rating products to be disclosed to the public and to users of ESG ratings
The Commission adopted a draft Commission Delegated Regulation supplementing the ESG Rating Regulation with regard to RTS specifying the elements of ESG rating products to be disclosed to the public and to users of ESG ratings, rated items and issuers of rated items.
The structure of the draft Commission Delegated Regulation is as follows:
- Article 1 specifies that the RTS address disclosures to be made under Annex III.1 and Annex III.2 of the ESG Rating Regulation.
- Article 2 specifies that disclosures made in accordance with Annex III.1 of the ESG Rating Regulation should be presented in accordance with the sequence and structure of the table in Annex I of the RTS.
- Article 3 requires a range of rating level disclosures around what is rated and what risks and impacts are measured.
- Article 4 addresses general methodological disclosures.
- Article 5 deals with disclosures on the limitations of data sources.
- Article 6 deals with disclosures on ESG rating providers’ organisational information.
- Article 7 establishes a higher level of methodological disclosures for rated items and users of ESG ratings.
- Article 8 deals with disclosures on the revision of methodologies.
The draft Commission Delegated Regulation enters into force on the twentieth day following its publication in the OJ. It applies from 2 July 2026.
24 April 2026 – ESG Rating Regulation – Commission adopts Delegated acts on fees and penalties
The Commission adopted:
- Commission Delegated Regulation supplementing the ESG Rating Regulation with regard to fees charged by the European Securities and Markets Authority (ESMA) to ESG rating providers. This Delegated Regulation supplements the ESG Rating Regulation by specifying the type of fees, the matters for which fees are due, the amount of the fees and the respective justification, the manner in which they are to be paid and, where applicable, the way in which ESMA is to reimburse competent authorities in respect of any costs that they might incur when carrying out tasks pursuant to that Regulation, in particular as a result of any delegation of tasks pursuant to the ESG Rating Regulation.
- Commission Delegated Regulation supplementing the ESG Rating Regulation with regard to rules of procedure on fines and periodic penalty payments imposed to ESG rating providers by ESMA. This Delegated Regulation sets out further rules of procedure for the exercise of ESMA’s power to impose fines or periodic penalty payments, including provisions on rights of defence, temporal provisions and the collection of fines or periodic penalty payments, and on detailed rules on the limitation periods for the imposition and enforcement of fines and periodic penalty payments.
Next steps
The Council of the EU and the European Parliament will now scrutinise the Delegated Regulations. If neither object, the Delegated Regulation on fees enters into force on the day following that of its publication in the OJ and the Delegated Regulation on fines and periodic penalty payments enters into force on the twentieth day following its publication in the OJ.
Link to France France
There have been no reported updates this month.
Link to The Netherlands The Netherlands
There have been no reported updates this month.
Link to Australia Australia
Climate Integrity report co-authored by Ruth Higgins SC suggests recent ICJ decision will catalyse more climate litigation
A report from Climate Integrity co-authored by the incoming solicitor general, Ruth Higgins SC, found a recent Advisory Opinion from the International Court of Justice on states’ climate change obligations would catalyse increased litigation over companies’ and directors’ climate obligations. The report warns of three primary litigation fronts: greenwashing claims (including those concerning ‘Paris-aligned’ targets), disputes over the regulatory approval of emissions-intensive projects, and legal challenges concerning director liability for climate-related harm.
In the ICJ opinion, their Honours found states must act with due diligence and cooperate internationally to prevent environmental harm from greenhouse gas emissions, aligning with commitments under the Paris Agreement. The report observed this decision “has already precipitated legal and regulatory developments that create or amplify climate-related transition risks” (indeed, the opinion already been relied upon in at least three Australian cases challenging decisions to approve fossil fuel projects) and “we expect it to continue to do so. As the magnitude of those risks or the probability of their occurrence rises, so too may the standard of care expected of directors of those corporations.”
The report stated that directors of fossil fuel companies will be affected most by the opinion, and that “in our view, directors of such corporations would be required in their decision-making processes to a least consider such risks” that their companies’ assets associated with fossil fuels may be limited, prohibited or rendered financially unviable in the near future.
The report highlighted the situations most likely to give rise to a breach of a director’s duty:
- Where a director approves misleading statements about a corporation’s climate-related risks (including statements that are misleading by omission);
- Where a director fails to consider climate-related risks at all; or
- Where a director approves a course of action so unreasonable that no reasonable director would have approved it.
The takeaway from the Climate Integrity report is that directors must exercise greater ‘diligence and intelligence’ regarding climate-related risks. Specifically, they should stay informed on evolving climate developments, seek expert advice when necessary, and ensure timely risk disclosure to the market.
Link to United States- SEC and CFTC United States- SEC and CFTC
There have been no reported updates this month.
Link to International regulators – FSB, IOSCO, Basel Committee, NGFS, SASB, IFRS, ISSB International regulators – FSB, IOSCO, Basel Committee, NGFS, SASB, IFRS, ISSB
There have been no reported updates this month.