Just because we’re highly likely to see a monkey wrench thrown into the current SEC’s efforts to adopt regulations on climate and sustainability (see this PubCo post and this PubCo post) doesn’t mean that we won’t be seeing a lot of activity in connection with state and international ESG requirements, along with voluntary reporting standards and various stakeholder policies, that will affect many US and other companies in this new year. This new Cooley Alert, Climate and Sustainability Regulations: 2024 End-of-Year Review, from our Public Companies and ESG and Sustainability Advisory groups, provides a rundown of developments regarding current key climate and sustainability regulations, such as the California climate statutes and the EU’s Corporate Sustainability Reporting Directive, and the scoop on significant stakeholder developments as of the end of 2024. The Alert also highlights “critical areas of focus for the year ahead.” If your company may be subject to any climate or sustainability frameworks—whether mandatory or voluntary—this is a comprehensive Cooley Alert that you need to read!
As the Alert points out, while the new Administration will probably beat a hasty retreat when it comes to climate and sustainability regulation on a federal level, “2024 was an active year in many other jurisdictions around the world and certain US states, with important regulations and guidance coming out in California, the European Union, Australia, and Canada—and many countries such as the UK not far behind. Nongovernmental frameworks such as the CDP, Science Based Targets initiative and International Sustainability Standards Board also have seen notable developments.” In 2025, many companies will probably be devoting time and resources to compliance with some of these existing regulations and standards. The Alert also discusses topics such as sustainable finance and anti-greenwashing regulation. In addition, the Alert identifies potential changes already on the agenda and others that we might see in the new year. For example, the Alert suggests, we may, in the future, begin to see the rise of the “global reporting passport”: “With the growing number of sustainability reporting standards joining existing voluntary frameworks, 2024 has seen a focus on interoperability and alignment, leading to further convergence of commonly used frameworks. As standards converge, companies will be able to prepare their reports once and use the data points to satisfy multiple global reporting obligations.” Definitely something to which we can look forward! Be sure to check out the new Alert!
