In this issue:

Chapter 1: UK developments 

Chapter 2: EU Developments

Chapter 3: International developments

This month, we saw significant developments in nature and biodiversity policy, including the publication of Nature-Positive Transition Pathways (“NPPs”) for priority sectors and the UK's 30by30 delivery plan for nature protection. We also saw progress on international biodiversity governance, with the UK ratifying the BBNJ Agreement.

(a) Nature-Positive Transition Pathways for the UK economy

In its Environmental Improvement Plan (2025), the UK Government committed to working with GFI, WWF-UK and UKCEH to develop NPPs for the UK focusing on priority sectors: agrifood, water utilities and the built environment. The UK ASA has also made some rulings in relation to carbon offsetting in the air travel sector. 

In July 2026, the group published “Co-creation and evaluation of Nature-Positive Transition Pathways for the UK economy: a methodological approach”. It provides Nature-Positive Transition Pathways which provide a practical bridge between national nature targets and real-economy delivery, helping to create a shared understanding of what delivery of those targets looks like in practice.

(b) UK Government publishes 30by30 delivery plan for biodiversity

On 13 July 2026, the UK government published its 30by30 on land delivery plan to complement the vision and criteria for 30by30 on land that was published in 2024.

The plan explains how the government will deliver its commitment to protect 30% of land for nature in England by 2030 and how it will work with and support stakeholders and landowners to manage and protect their land for nature for the long term and contribute towards the 30by30 commitment.

(c) UK ratifies BBNJ Agreement

On 20 September 2025, the United Nations announced that the High Seas Treaty, also known as the Biodiversity Beyond National Jurisdiction (“BBNJ”) Treaty, had met the 60 ratifications required for its entry into force, clearing the way for it to take effect from 17 January 2026. This follows almost a decade of negotiations with agreement on the content finally being reached in 2023.

The treaty establishes legally binding rules to, amongst other things, conserve and sustainably use marine biodiversity and create protected areas across two-thirds of the world’s ocean area that lies beyond national boundaries.  It also sets the stage for increased scientific cooperation, including fairer use of marine genetic resources. It also supports the Kunming-Montreal Global Biodiversity Framework and reinforces the UN Convention on the Law of the Sea as the foundation of international ocean governance. On 10 July 2026, the UK ratified the BBNJ Agreement. 

“The agreement will make it possible to

• establish marine protected areas (MPAs) in the high seas
• regulate the exploitation of marine genetic resources
• assess the environmental impact of current and future human activities
• support developing countries through capacity-building and marine technology transfer programmes.” 

(d) ASA rules on carbon offsetting claims in the air travel sector

On 15 July 2026, the Advertising Standards Authority (“ASA”) made two more rulings on carbon offsetting claims in the air travel sector. These connected rulings examined claims such as voluntary “bulk offset”, “more eco-friendly” and “climate-consciously” used in the air travel sector and considered whether these terms gave a misleading impression for consumers.

In the EU this month we saw developments on sustainability, climate and nature-related initiatives, including proposed reforms to the EU Emissions Trading System, a new Electrification Action Plan, implementation of the EU Deforestation Regulation and Ecodesign for Sustainable Products Regulation.  We also saw a number of publications in relation to sustainability reporting and ESG ratings regulation.

(a) ESG Ratings Regulation update

1. ESMA confirms that from 2 July 2026, the exemption for third parties publishing or distributing ESG ratings of existing, but still unauthorised, ESG rating providers will be able to continue to do so from 2 July 2026. The announcement clarifies how the transitional regime will work from 2 July 2026 to 2 November 2026.
2. On 28 July 2026, the EU ESG Ratings regulatory technical standards specifying elements of ESG ratings products to be disclosed to the public and to users of ESG ratings (in force) and regulatory technical standards specifying the measures and safeguards to be implemented by ESG rating providers to separate their ESG rating activities from their other activities following regulations (in force) were published in the Official Journal of the EU.
3. On 30 July 2026, the delegated act supplementing the ESG Ratings Regulation with regard to rules of procedure on fines and periodic penalty payments imposed to ESG rating providers by ESMA (in force 19 August 2026) and with regard to fees charged by ESMA to ESG rating providers (in force 31 July 2026) were published in the Official Journal of the EU.
4. ESMA also published FAQs on the ESG Ratings Regulation.

(b) European sustainability reporting updates – final ESRS and VESRS published

Following the finalisation of the omnibus simplification package for corporate sustainability reporting and due diligence, on 3 July 2026 the European Commission adopted the revised, simplified European Sustainability Reporting Standards (“ESRS”) and Sustainability Reporting Standard for Voluntary Use (“VESRS”) for smaller companies outside the scope of the Corporate Sustainability Reporting Directive (“CSRD”). On 28 July 2026, EFRAG announced that it has launched a revised interactive document set for the new standards, see here.

On 23 July 2026, EFRAG launched a public consultation on its ESRS for Certain Non-EU Undertakings (“ESRS-40a”) – these standards were previously known as ESRS-TC and NESRS.  EFRAG is seeking feedback on drafting approach, references to EU legislation, option to limit the reporting to EU-related impacts only, instead of reporting on global impacts (mixed approach) and interoperability. The consultation closes on 31 October 2026. 

See here for links to the slides and presentation given by EFRAG and read more in our briefing here.

On 1 July 2026, EFRAG published State of Play Report 2026, providing an evidence-based assessment of sustainability reporting practice under ESRS. Read more here.

(c) EU ban on the destruction of unsold clothing and footwear comes into force

On 19 July 2026, the Commission’s new measures adopted under the Ecodesign for Sustainable Products Regulation (“ESPR”) regulating the destruction of unsold apparel, clothing, accessories and footwear came into force.  

Every year in Europe, an estimated 4-9% of unsold textiles are destroyed before ever being worn. The ESPR requires companies to disclose information on the unsold consumer products they discard as waste. It also introduces a ban on the destruction of unsold apparel, clothing accessories and footwear.

By requiring disclosure and banning destruction of unsold apparel, the regulation is intended to:  

• Reduce wasteful disposal of valuable goods  
• Encourage reuse, repair, sustainable production and business efficient practices  
• Cut the environmental footprint of the apparel sector. 

The disclosure rules already apply to large companies and the ban on destruction of unsold apparel will apply to them from 19 July 2026.  The ban and disclosure requirements will apply to medium-sized companies from 2030. Small enterprises will not be subject to the regulation.  

Here are links to the Delegated and Implementing Acts. 

(d) European Commission proposes reform to EU Emissions Trading System (“EU ETS”)

On 17 July 2026, the Commission announced modernisation of the EU ETS recognising that “the geopolitical and economic context has changed, and EU industry is under increased pressure”. 

The review is intended to bring relief to industry by:

• Updating the linear reduction factor (LRF) of 3.7% for 2031-2035 to 1.7% for 2036-2040;
• Free allocation for companies will continue beyond 2030;
• Integrating permanent carbon removals into the EU ETS (including slowing the reduction of free allocation for sectors covered by the Carbon Border Adjustment Mechanism); and
• Reform of the Market Stability Reserve.

The proposal can be found here.

(e) European Commission announces EU Electrification Action Plan

On 17 July 2026, together with the reforms to the EU Emissions Trading System, the Commission announced its new Electrification Action Plan (“EAP”). 

The plan recognises the benefits of electrification for European consumers and intends to address the barriers to electrification, such as:

• Electricity often costs three times more than gas.
• Grid connections can take years.
• Too many innovative technologies never reach commercial scale.
• Companies have too little incentive to make the switch from fossil fuels to electricity. 

The EAP will reduce the pricing gap between electricity and fossil fuel energy costs to incentivise the uptake of cleaner energy, future-proof energy bills for consumers, lower the upfront costs of electrification, speed up grid deployment and promote the development of viable investment project and manufacturing capacity in clean energy technologies.

See here for factsheet on the EAP, proposed regulation and staff working document accompanying the regulation.

(f) EU Deforestation Regulation – Delegated Act and Implementing Act adopted

On 13 July 2026, the European Commission adopted two measures to support the implementation of the EU Deforestation Regulation (“EUDR”) which form a part of the simplification package agreed in May 2026. 

The Delegated Act updates Annex I of the EUDR, removing cattle hides, skins and leather, re-treaded tyres, soybeans for sowing, articles of vulcanised rubber, conveyor and transmission belts, and aircraft and motor vehicle seats from the scope of the Regulation whilst adding soluble coffee, certain palm oil derivatives and frozen cattle tongues. 

To allow businesses sufficient time to prepare, the new products added to the scope will become subject to the Regulation from 30 December 2027.   

The Delegated Act will now be sent to the European Parliament and the Council of the EU for scrutiny before entering into force.   

The Information System Implementing Act was also published, establishing the technical rules for the EUDR Information System and introducing operational simplifications. 

A revised Staff working document has also been published.

(g) European Commission publishes guidelines on the application of the EU Forced Labor Regulation (“EU FLR”)

On 26 June 2026, the Commission publishedguidelines on the application of EU FLR.  They are non-binding but provide guidance for those in scope of EU FLR and set out a six-step due diligence framework for companies.

The EU FLR was adopted on 19 November 2024 and becomes applicable on 14 December 2027 when enforcement will begin.

This month, we bring you international climate reporting updates from California and Singapore, updates to the GHG Protocol and bring you a briefing setting out what businesses should expect at COP17 on desertification being held in Mongolia in August.

(a) Updates to Greenhouse Gas Protocol corporate standards announced

On 29 July 2026, the Greenhouse Gas Protocol (“GHGP”) announced a series of updates to its corporate standards.  

These updates include:

• GHGP and the International Organization for Standardization (“ISO”) will combine their corporate carbon accounting standards into a single, harmonized global accounting standard,
• GHGP is publishing the results of its public consultation on the Scope 2 standard and,  
• GHGP is releasing preliminary feedback from the Request for Information on its Actions and Market Instruments (AMI) standard development process, which will be synchronized with Scope 2 development. 

This builds on the strategic partnership between GHGP and the ISO established last year and the series of updates will further the alignment and harmonisation of standards to publish a single, co-branded corporate standard, with an integrated public consultation on the future corporate standard planned for Q2 2027 – this action is a key milestone in the COP30 Action Agenda.

(b) Singapore publishes draft ISSB-aligned reporting framework

On 27 July 2026, the Accounting and Corporate Regulatory Authority (“ACRA”) launched a public consultation on the draft Singapore Sustainability Disclosure Standards.   

These standards set out the information companies would be required to disclose on how they manage climate-related risks and opportunities. The public consultation will take place from 27 July to 25 October 2026.

The draft standards are based on the ISSB Standards IFRS S1 and IFRS S2.  In Singapore it is proposed that only IFRS S2 (covering climate-related disclosures”) will be mandatory and IFRS S1 will be voluntary.  Other adjustments include tailored transition reliefs and a requirement for a statement of compliance to align with Singapore’s implementation roadmap.

(c) California Air Resources Board (“CARB”) updates:

1.     CARB provides a roadmap: 2026 revised initial regulations open for public comment: On 27 July 2026, CARB published its revised Initial Regulation intended to implement the Climate Corporate Data Accountability Act (“SB 253”) (see CARB’s notice here and its revised Initial Regulation here).  The proposed substantive revisions in CARB’s draft address definitions, fee schedules, and reporting requirements unique to the inaugural 2026 report.  Read more here.

2. CARB previews 2027 GHG reporting requirements while 2026 reporting deadline remains delayed until Q4: On 21 July 2026, the CARB held a public workshop to discuss development of the regulatory framework for its greenhouse gas reporting program under the SB 253. This is CARB’s first workshop since it delayed the reporting deadline for Scope 1 and Scope 2 greenhouse gas emissions from 10 August 2026, to 10 November 2026 (see CARB’s notice here). Read more here. 

(d) COP17 on desertification – what is it and why does it matter for finance, technology, business and nature?

COP17 to the United Nations Convention to Combat Desertification (“UNCCD”) will take place from 17 to 28 August 2026 in Ulaanbaatar, Mongolia. The theme is “Restoring Land. Restoring Hope.”  In the context of a world where drought is increasingly widespread and has significant ramifications for livelihoods, agriculture and land use, in this briefing we will discuss the aims of the UNCCD, the impetus for action and why it matters. Read more here.

Our global Sustainable Finance & Investment group brings together a multidisciplinary global team that provides clients with best-in-market support.  We are following developments relating to ESG regulation, so please get in touch if you would like to discuss.

Stay ahead with timely curated developments, insights and thought leadership on ESG regulation with our ESG Regulatory Alerts tool.  

This note is intended to be a general guide to the latest ESG developments. It does not constitute legal advice.

Authored by Emily Julier and Rita Hunter.