Horizon – News and Trends in Sustainability Law

Deadline alert

• California: Under SB 54, the Plastic Pollution Prevention and Packaging Producer Responsibility Act, November 15, 2025 is the deadline to report data to the Circular Action Alliance for covered material sold/distributed in California in 2023.


• California: Under SB 261, the Climate-Related Financial Risk Act, covered entities are required to post their first biennial climate-related financial risk report to CARB’s public docket by January 1, 2026. For SB 253, the Climate Corporate Data Accountability Act, CARB has proposed June 30, 2026 as the initial deadline for Scope 1 and 2 reporting.

Please also see our ESG calendar for information about key reporting deadlines around the world.

Disclosures and voluntary reporting

CARB publishes guidelines and checklist for SB 261 disclosures, then releases Preliminary List of Reporting/Covered Entities. On September 2, the California Air Resources Board (CARB) published draft guidelines and a checklist for climate-related financial risk disclosures under SB 261, the Climate-Related Financial Risk Act, which requires companies to disclose their material climate-related financial risks. The checklist outlines minimum requirements for companies with over USD500 million in annual revenue doing business in California, covering five key areas: reporting framework selection, governance, strategy, risk management, and metrics/targets. Notably, detailed greenhouse gas emissions data (Scope 1, 2, and 3) may not be required for the initial reporting period. The draft guidance also clarifies exemptions (such as for insurance entities), allows use of either calendar or fiscal year data, and permits consolidated parent-subsidiary reporting. Companies may use existing reports if they meet statutory requirements and must post disclosures on their website and CARB’s public docket. However, CARB reiterated that the guidance is not legally binding and does not create new obligations beyond the statute. As noted elsewhere in this issue, January 1, 2026 is the deadline for covered entities to post their first biennial climate-related financial risk report to CARB’s public docket.

Next, on September 24, CARB published its Preliminary List of Reporting/Covered Entities – specific companies that may be subject to SB 261 and SB 253, the Climate Corporate Data Accountability Act, which requires US-based entities doing business in California with over $1 billion in annual revenue to publicly disclose their scope 1, 2, and 3 GHG emissions. The list is reportedly going to be refined – at present, it names more than 4,000 entities, but some are duplicates, some are nonprofits that technically are not in scope, and some in-scope companies may not have been added to the list yet. CARB has advised, first, that the preliminary list will inform its development of the fee regulation and second, that in-scope entities are required to comply with the two laws whether or not their names appear on the list. Download the list via this page. CARB is also asking stakeholders to help build out the information on the preliminary list via this voluntary survey.

Omnibus I in the news. The EU continues to advance Omnibus I, the set of proposed simplification measures that will streamline key reporting and compliance requirements of the bloc’s Green Deal: the Corporate Sustainability Reporting Directive (CSRD), Corporate Sustainability Due Diligence Directive (CSDDD), EU Green Taxonomy, and Carbon Border Adjustment Mechanism (CBAM). Here are the latest developments:

• European Parliament approves CBAM reforms. On September 10, the European Parliament overwhelmingly voted (617 to 18, with 19 abstentions) to approve the simplification of the Carbon Border Adjustment Mechanism (CBAM). Chief among the amendments is a new de minimis threshold, under which imports of up to 50 metric tons per importer per year will not be subject to CBAM rules. This change effectively exempts 90 percent of importers from CBAM’s rules. Notably, the overarching climate ambition behind the mechanism remains unchanged: 99 percent of total CO2 emissions from imports of iron, steel, aluminum, cement, and fertilizers will still be covered by the CBAM.


• President von der Leyen reiterates Omnibus I goals. In her September 9 State of the Union address, European Commission President Ursula von der Leyen reiterated the Commission’s goals of simplifying and streamlining the European Green Deal. “To protect jobs, we need to make business in Europe easier,” she stated. The reforms’ overarching goal of “less paperwork, less overlaps, less complex rules,” she continued, will ultimately “cut EUR8 billion a year of bureaucratic costs for European companies.” Von der Leyen added that the Commission also intends to pursue similar streamlining reforms in other legislative areas. Read her address here.


• Broad swathe of European entities urge European Commission to preserve core elements of reporting standards. In an open letter released on September 9, 475 European entities – multinationals, financial institutions, professional services firms, NGOs, and religious, civil society, and public interest groups – called for “preserving the core elements” of the EU’s sustainability reporting standards, affirming that the standards “are essential for achieving the EU’s wider sustainability, growth and competitiveness ambitions.” The European Commission has stated that the Omnibus I reforms would reduce reporting obligations by 25 percent for large private firms and 35 percent for small and medium-sized enterprises. The open letter, “Omnibus initiative: Sustainability rules are essential for European competitiveness,” sets out recommendations for achieving regulatory simplification “without compromising on the substance of sustainability rules or their significant benefits for businesses across the EU.” The signatories are calling for the European Commission to maintain the CSRD’s double materiality approach; include companies with more than 500 employees in the CSRD’s scope (in line with the scope of the 2014 Non-Financial Reporting Directive); ensure the value chain cap allows for the constructive exchange of sustainability information between investors and companies; safeguard the CSDDD’s core elements, not least risk-based corporate due diligence; and maintain the CSDDD requirement for companies to adopt science-based climate transition plans. Retaining these core elements, the open letter stated, “is necessary for providing the transparency and certainty needed to achieve growth whilst supporting decarbonisation.”


• Switzerland will harmonize its legislation with reformed CSDDD. When the shape of the Omnibus I reforms is clearer, Switzerland will adapt its equivalent supply chain legislation to harmonize with the EU’s Corporate Sustainability Due Diligence Directive (CSDDD). In its September 5 announcement of the coming change, the Swiss Federal Council stated that it “considers it necessary to adopt the legislation to continue ensuring harmonization of rules at the international level.” The Council intends to submit a proposed draft for public consultation by the end of March 2026.

Another delay for the EUDR? The European Commission is considering another 12-month delay of the Regulation on Deforestation-Free Products (EUDR)’s due diligence reporting obligations. The EUDR prohibits the import into the EU of commodities such as timber, soy, beef, palm oil, rubber, cocoa, and coffee, along with their derivatives, unless they are certified as deforestation-free. Its due diligence obligations were originally set to go into effect on December 31, 2024, but in December 2024 the European Parliament voted overwhelmingly in favor of delaying those requirements by 12 months. On September 23, 2025, EU Environment Commissioner Jessika Roswall notified Antonio Decaro, the European Parliament’s Environment Committee chair; Magnus Johannes Heunicke, Chair of the Environment Council; and the EU’s Danish presidency that she intends to seek a further 12-month delay. Roswall pointed to concerns about the readiness of the Commission’s IT system to handle the vast projected quantity of data EUDR reporting will generate. Speaking to the European Council, Roswall stated that she will next discuss the proposed delay with the Council and the European Parliament before any formal moves are made; she reportedly also suggested the possibility of further streamlining of the EUDR’s scope.

Spain announces state pact to address climate emergency; annual emissions reporting deadline coming soon. On September 2, Spain’s Council of Ministers approved El Pacto de Estado contra el cambio climático (the state pact to address the climate emergency), a 10-point plan to help the country address the climate emergency and speed up the transition to net zero. Among the plan’s 10 points: the government will create permanent funds to accelerate local recovery from weather disasters and harden against future events and will also create a new State Agency for Civil Protection and Emergencies and a national network of climate shelters. Speaking on September 1, Prime Minister Pedro Sánchez stated that Spain will be discussing the plan with the European Commission and the governments of Spain and Portugal to explore possible synergies and collaborations. Earlier this year, Spain put in place Royal Decree 214/2025, which establishes mandatory disclosure rules for businesses, on an accelerated timeline: reporting by companies of their 2025 Scope 1 and Scope 2 emissions starts in 2026. Also starting in 2026, companies are required to submit GHG reduction plans with a minimum target horizon of five years. Large covered entities will be required to include their Scope 3 emissions report starting in 2028.

Singapore amends reporting requirements. Singapore’s Accounting and Corporate Regulatory Authority (ACRA) and Singapore Exchange Regulation (SGX RegCo) have announced significant changes to the sustainability reporting obligations for Singapore listed companies. All companies are still required to report their Scope 1 and 2 emissions starting with FY2025; but, for Scope 3 emissions, only Singapore’s largest listed companies – the 30 entities on the Straits Times Index – will need to report their Scope 3 emissions starting with FY 2026. For smaller companies and non-listed companies, Scope 3 reporting is voluntary, for now. For all entities, the requirement to provide external limited assurance for Scope 1 and 2 emissions is being pushed forward to 2029. See ACRA’s announcement of the changes here.

ISO and GHG Protocol will unify their GHG emissions reporting standards. On September 9, two key standard-setting organizations, the International Organization for Standardization (ISO) and the Greenhouse Gas Protocol (GHG Protocol) announced a new strategic partnership to unify global GHG emissions reporting standards. The two organizations state that they have agreed to harmonize their existing standards and to work together to develop new standards for carbon accounting. Among the standards they will address are the GHG Protocol Corporate Accounting and Reporting standard, the Scope 2 and 3 standards, and the ISO 1406X standards, which set out a framework for quantifying, reporting, and verifying GHG emissions and removals. To meet growing business demand, they stated, they will also work to develop a joint product carbon footprint standard, described by GHG Protocol as “a common global language for emissions accounting which will accelerate progress towards decarbonization.” ISO, founded in 1946, is a non-governmental organization that brings together standardization bodies to create standards that ensure consistency worldwide. It currently has members from 173 countries. GHG Protocol, first convened in 1998, works to establish global standardized frameworks to measure GHG emissions from private and public sector operations, value chains, and mitigation actions. In 2023, 97 percent of disclosing S&P 500 companies reported to CDP (formerly called the Carbon Disclosure Project) using GHG Protocol.

SBTi introduces Power Sector Net-Zero Standard. Early this month, the Science Based Targets initiative (SBTi) released the initial draft of its Power Sector Net-Zero Standard, created to help companies across the power sector in setting near- and long-term goals to achieve net zero by 2050. SBTi has lately been working to develop sectoral standards for heavy emitters, among them the cement, construction, chemicals, air transport, and Forest, Land and Agriculture (FLAG) sectors. The proposed Power Sector Net-Zero Standard would affect companies involved in power generation, transmission, and distribution, as well as electricity storage, trade, and retail. It includes a proposed requirement that companies in the sector set out their plans to stop investing in and to phase out unabated fossil fuel use. Nearly 40 percent of GHG emissions worldwide arise from the power sector.

Greenwashing

Canadian securities regulator announces greenwashing allegations against an asset management company. The Ontario Securities Commission (OSC), Canada’s largest securities regulator, has filed an Application for Enforcement Proceeding alleging that the asset management company Purpose Investments and its CEO, Som Seif, made marketing claims about the way the company considers ESG factors that were “misleading, untrue, and in conflict with the prospectuses of the funds it managed.” The OSC’s allegations, released on September 15, cover a period from September 2019 to March 2023 during which it is alleged that the company told clients and prospective clients that ESG factors were central to its investment strategies. But, the OSC stated in its filing, “Purpose did not consider ESG in making investment decisions for many of the funds it managed,” nor did it put in place formal policies or documented procedures in that period. In a press release released shortly after the OSC’s action, CEO Som Seif defended Purpose’s long-term approach to integrating ESG factors into its work, adding that the company had rejected an offer to enter a settlement with OSC because “such an outcome would not have reflected our principles or our responsibility to our investors and the public.” He stated, “We are struggling to understand how the OSC is seeing this as a topic for enforcement action against Purpose, and even more specifically against me.” A case management hearing on Ontario Securities Commission v Purpose Investments Inc will be held before the Capital Markets Tribunal on October 6.

Addressing greenwashing in advertising, Germany advances draft bill to implement EU Empowering Consumers Directive. On September 3, Germany’s federal cabinet approved the Entwurf eines Dritten Gesetzes zur Änderung des Gesetzes gegen den unlauteren Wettbewerb (Draft of a Third Act to Amend the Act Against Unfair Competition), a measure aiming to transpose into German law the EU’s Empowering Consumers Directive, which addresses environmental and sustainability claims in advertising. The draft measure’s sweeping rules will apply to all sectors and industries. The foundation of the rules is the requirement to substantiate green claims. For example, terms like “sustainable” and “climate neutral” may be used only if they can be supported with scientific evidence. Additionally, marketing claims about future goals (such as “we will be climate neutral by 2030”) must be supported by a publicly available, realistic implementation plan, and companies will be allowed to add sustainability logos to marketing materials only if those logos are based on third-party certification or set by a government body. Of note: the German rules will specifically forbid marketing a product as climate neutral or environmentally friendly if that claim is based on emissions offsets.

Australia: ASIC sharpens focus on climate reporting and greenwashing. Reflecting a broader regulatory push for transparency, accountability, and integrity in sustainability disclosures, the Australian Securities and Investments Commission (ASIC) has released a series of updates reinforcing its commitment to guiding entities through the transition to Australia’s new climate reporting regime. Notably, in its efforts, ASIC remains focused on misleading sustainability claims. See our alert.

Bermuda financial regulator proposes amendments to address greenwashing by investment firms. On September 5, the Bermuda Monetary Authority (BMA) released a consultation paper setting out its plans to update existing Bermudian law to address greenwashing by investment funds. The BMA proposes amending Bermuda’s Investment Funds Act 2006 to require all Bermudian-registered and authorized funds that make ESG claims to ensure that disclosures are accurate, clear, complete, and substantiated. The Investment Fund Rules 2019 would be amended to specifically prohibit the use of misleading fund names that do not accurately reflect the fund’s business activities. BMA is also proposing a six-month transitional period for compliance once the amendments are in place. See the Bermudian consultation paper, Framework Enhancements Introducing Sustainability Disclosures and Prohibition on the Use of Misleading Fund Names.

Sustainability: Regulatory

White House’s Unified Agenda sets out intended deregulatory actions by EPA. Among the regulatory priorities set out in the semiannual Unified Agenda of Regulatory and Deregulatory Actions (UA), released by the White House on September 4, are key points about the deregulatory agenda of the EPA. Remaining on the path it has been forging this year, the agency intends in the coming months to continue revisiting environmental regulations in several areas, among them water, climate change, and chemical rules. In the UA, the EPA specifies that it intends to finalize rules by February 2026 rescinding the legally enforceable maximum contaminant levels (MCLs) in drinking water for four PFAS (per- and polyfluoroalkyl substances) and to finalize a rule, by April 2026, extending the PFOA and PFOS compliance timeline for public water systems by two years. Surprisingly, the UA does not mention an expected third deregulatory move that would affect the designation of PFOA and PFOS as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). You may also be interested in our recent alert, EPA signals intention to modify Biden Administration’s National Primary Drinking Water Regulation for PFAS.

Senate investigates companies that may have supported EPA proposal to rescind the 2009 Greenhouse Gas Endangerment Finding. The Senate Committee on Environment and Public Works is investigating whether a select group of entities influenced EPA’s Proposed Rule rescinding the 2009 Greenhouse Gas Endangerment Finding. The Endangerment Finding is a prerequisite for regulating emissions from new motor vehicles and new motor vehicle engines. Without the Endangerment Finding in place, EPA lacks statutory authority under Section 202 of the Clean Air Act to prescribe standards for greenhouse gas emissions. Therefore, EPA also proposed to remove the GHG regulations for light-, medium-, and heavy-duty on-highway vehicles. However, EPA intends to retain regulations necessary for criteria pollutant and air toxic measurement and standards, Corporate Average Fuel Economy testing, and associated fuel economy labeling requirements.

Senator Sheldon Whitehouse (D-RI), ranking member of the Committee, wrote to more than 20 entities on September 16 asking that, by September 30, they provide documents concerning the role they may have played “in drafting, preparing, promoting, and lobbying on the [Proposed Rule].” The Whitehouse letter was sent to businesses, trade associations, and law firms. The Committee does not have the power to subpoena these documents, but the move has the potential to set the stage for future congressional investigations.

US rejects IMO’s Net-Zero Framework as an unfair global carbon tax that would harm American interests. The UN’s International Maritime Organization (IMO) has drafted regulations whereby ships must reduce their annual greenhouse gas fuel intensity (GFI) – that is, how much GHG is emitted for each unit of energy used. A ship emitting above GFI thresholds will have to purchase “remedial units” to balance its deficit emissions, while a ship using zero or near-zero GHG technologies will be eligible for financial rewards.  As we’ve previously reported, in April, IMO member nations agreed to legally binding targets for maritime shipping emissions: a 20 to 30 percent reduction in GHG emissions by 2030, a 70 percent reduction by 2040, and net zero “by or around” 2050.

The US formally rejected the agreement in August and has warned IMO member nations that, if they support the net-zero framework, the United States will consider remedies. A joint statement by the Secretary of State, Secretary of Commerce, and Secretary of Transportation sets out the United States’ position, which is that “the proposed framework is effectively a global carbon tax on Americans levied by an unaccountable UN organization.” The statement explains that the IMO standards would require the use of expensive fuels unavailable at global scale and would preclude the use of proven technologies that fuel global shipping fleets, including lower emissions options where U.S. industry leads such as liquified natural gas and biofuels. Further, under the IMO’s proposal, ships would have to pay fees for failing to meet unattainable fuel standards and emissions targets, driving up energy, transportation, and leisure cruise costs.

Draft regulations amending the International Convention for the Prevention of Pollution from Ships’ Annex VI are set to be adopted in October, with implementation guidelines expected in spring 2026 and entry into force in early 2027.

Top points from Colorado stakeholder meeting on its Producer Responsibility Program. The Colorado Department of Public Health and Environment (CDPHE) held a stakeholder rulemaking meeting on September 3 to discuss proposed amendments to Section 18.9 of the state’s Solid Waste Regulations, focusing on eco-modulation incentives for the Producer Responsibility Program. Key topics included updated definitions for compostable materials and contamination, revised benchmarks for eco-modulation bonuses (such as sourcing local recycled content and compostability standards), and new guardrails for case study incentives. The meeting featured robust public comment, with stakeholders raising questions about the practicality of Colorado-specific recycled content requirements, toxicity standards, and the verification of compostable packaging. Final rules are expected to be considered in November this year and take effect January 1, 2026.

EU formally adopts updates to Waste Framework Directive, targeting textile and food waste. On September 9, the European Parliament formally adopted the Waste Framework Directive, a set of rules aiming to prevent and reduce waste from food and textiles across the EU. The Directive introduces binding targets aiming to lower food waste by households, retailers, and restaurants by 30 percent by 2030, compared to 2021-2023 levels; food processing and manufacturing businesses will be required to reduce their food waste by 10 percent. These goals are to be met at the national level by December 31, 2030. Regarding textile waste, the Directive will require producers that make textiles available in the EU to cover the costs of collecting, sorting, and recycling waste textiles through new extended producer responsibility (EPR) programs, which are to be set up by each member state within 30 months of the directive’s entry into force. To address the waste generated by fast fashion, the Directive applies to producers both inside and outside the EU. Going forward, EU member states will have 20 months to transpose the rules into national legislation following their entry into force.

Also on September 9, the European Parliament voted to merge the End-of-Life Vehicles Directive and the 3R Type-Approval Directive into a new Regulation on Circularity Requirements on Vehicle Design and on Management of End-of-Life Vehicles. This measure now enters the negotiation phase. Finally, the consultation period for the EU’s proposed Circular Economy Act remains open until November 6. Comments may be provided through the Have Your Say portal.

Congressional Research Service publishes report on US-EU tariffs and trade Framework Agreement. On September 18, the Congressional Research Service published a report on the US-EU Framework on an Agreement on Reciprocal, Fair, and Balanced Trade (Framework Agreement) announced in August 2025. The Framework Agreement seeks to improve trade, investment, and market access between the two regions through such measures as eliminating tariffs and addressing barriers that restrict trade. Directly responding to US concerns with EU sustainability regulations, the EU has committed to work to, among other matters: (i) address the concerns of US producers and exporters regarding the EU Regulation on Deforestation-Free Products (EUDR), with a view to avoiding undue impact on US-EU trade; (ii) provide additional flexibility in the implementation of the Carbon Border Adjustment Mechanism (CBAM); and (iii) ensure that the Corporate Sustainability Due Diligence Directive (CSDDD) and the Corporate Sustainability Reporting Directive (CSRD) do not pose undue restrictions on transatlantic trade. In the context of the CSDDD, this includes undertaking efforts to reduce administrative burdens on businesses, including small- and medium-sized enterprises, and to propose changes to climate transition-related obligations and to the requirement for a harmonized civil liability regime for due diligence failures. Also in that context, the EU has committed to addressing US concerns regarding the imposition of CSDDD requirements on companies of non-EU countries with relevant high-quality regulations. See our alert for more information about the Framework Agreement.

Italy now requiring all businesses to have NatCat coverage – and requiring insurers to provide it. Italy is now requiring all corporate entities with either a registered office or a permanent establishment in Italy to purchase insurance policies that cover certain natural catastrophes and for insurers operating in Italy to offer such coverage. This bilateral obligation was codified in Italy’s 2024 budget law and refined this year under Ministerial Decree No. 18, which goes on to set out operational rules for both insurers and insureds. The coverage must include flood, overflow, inundation, earthquake, and landslide events; notably, certain other climate-related events, such as hail and hurricanes, are not in scope. Insurers are required to price these policies – nicknamed NatCat policies in the industry – proportionate to risk. While the law imposes an obligation on insurers, it also allows them to set ex ante risk tolerance thresholds; insurers that reach that threshold may suspend underwriting in the Italian marketplace – but they must immediately notify the Instituto per la vigilanza sulle assicurazioni (IVASS), Italy’s insurance regulator, or the equivalent regulator in the country where they are headquartered, and they must publish the decision on their website. Furthermore, when insured entities implement climate change mitigation measures, insurers must adjust their premiums accordingly, a requirement added to encourage businesses to invest in proactive climate resilience. Essential to the scheme is the role of SACE S.p.A., Italy's state-owned export credit agency, which will cover up to 50 percent of indemnities paid by insurers for mandatory natural catastrophe claims. This summer, a consortium of insurance companies operating in the Italian market formed a NatCat insurance pool, an autonomous legal entity and operational hub for managing catastrophic risks. At this writing, about 75 percent of insurance companies operating in Italy have joined the pool.

Africa Climate Summit culminates with ambitious global call to action. The second Africa Climate Summit concluded on September 10 with the official adoption of the African Leaders Addis Ababa Declaration on Climate Change and Call to Action (the Addis Ababa Declaration), which seeks to position Africa at the forefront of global climate action and renewable energy generation. The ambitious Addis Ababa Declaration presses for "strengthened and sustained support to scale up the implementation of African-led climate initiatives,” such as the Great Green Wall Initiative and the African Forest Landscape Restoration Initiative. It also urges reform of the global financial architecture – the way multilateral development banks structure investment – to lower borrowing costs and expand African representation in financial governance. Among many other developments at the Summit, Abiy Ahmed, Prime Minister of the Federal Democratic Republic of Ethiopia, announced two climate finance initiatives, the Africa Climate Innovation Compact (ACIC) and the African Climate Facility (ACF), with African leaders committing to mobilize USD50 billion annually to support those programs, and major African financial institutions signed a landmark cooperation framework to advance the Africa Green Industrialisation Initiative. Talks also furthered the idea of a permanent ACS secretariat – a centralized administrative body to advance climate action and accountability. The second Africa Climate Summit took place September 8 - 10 in Addis Ababa, attended by more than 25,000 delegates ranging from heads of state and business leaders to farmers, youth, and academics.

Sustainability: Litigation

DOJ calls for summary judgment in New York and Vermont Climate Superfund lawsuits. The Department of Justice has filed a motion for summary judgment in USA and EPA v. New York asking the US District Court for the Southern District of New York to rule that New York’s Climate Change Superfund Act is an unconstitutional overreach. The New York law, like the similar law in Vermont, requires major oil and gas companies to pay into a state-based fund based on their historic GHG emissions; the fund will support projects mitigating the impacts of climate change in each state. At this writing, the court has not ruled on the August 29 motion for summary judgment, nor on a motion to intervene filed by a number of environmental groups, among them Food & Water Watch and Catskill Mountainkeeper.

Next, on September 15, the DOJ asked the US District Court for the District of Vermont to overturn Vermont’s Act 122, the Climate Superfund Act. The motion for summary judgment in USA and EPA v. Vermont calls the Vermont law “an attack on the supremacy of federal law that threatens the balance of power between the national government and the states” and asserts that the law “conflicts with the express foreign policy of the United States.” As with the New York Superfund case, at this writing, the court has not ruled on the motion for summary judgment.
See some of our previous coverage of the litigation over these Superfund laws here and here.

Eighth Circuit pauses SEC climate rules litigation pending SEC action. The Eighth Circuit Court of Appeals has ordered that the proceedings in Iowa v. SEC – the case challenging the Securities and Exchange Commission’s landmark climate disclosure rules – remain paused until the SEC either reconsiders the rules through the notice-and-comment rulemaking process or decides to renew its defense of the rules in court. In its latest order, the court emphasized that it is the SEC’s responsibility to determine the outcome of its rules – whether to rescind, repeal, modify, or defend them. Find out more in this concise post on our Market Edge blog.

Chamber of Commerce v. CARB: Appeals court denies plaintiffs’ injunction against SB 253 and SB 261. On September 11, the US District Court for the Central District of California issued an order in Chamber of Commerce v. California Air Resources Board – ongoing litigation targeting California’s landmark climate disclosure laws, SB 253 and SB 261 – denying the plaintiffs’ motion for an injunction that would prevent the laws from taking effect pending appeal. The District Court found that the plaintiffs had failed to raise “serious questions going to the merits,” with reasoning that overlapped significantly with its earlier analysis of the plaintiffs’ likelihood of success when it denied a preliminary injunction in August. The parties have agreed to stay all proceedings in the District Court action, including discovery, until the appeal is resolved. Only one claim remains: that the laws violate the First Amendment by compelling speech. At this writing, no deadlines are currently pending in the District Court, and no briefing schedule has been set in the Ninth Circuit. Given the lack of judicial stay or injunction, and the district court’s early findings in favor of the laws’ validity, businesses may consider preparing to comply, particularly with respect to the January 1, 2026 deadline for SB 261 climate-risk disclosure reporting. With respect to SB 253, CARB has indicated that it intends to exercise its discretion during the program’s first reporting cycle and not seek enforcement actions against companies that make good-faith compliance efforts. Although not final, CARB’s current regulatory proposal includes a deadline of June 30, 2026, for SB 253 compliance. See some of our earlier coverage of these laws and this litigation here and here.

DC Appeals Court rules that EPA may claw back green bank funds. On September 2, the US Court of Appeals for the DC Circuit ruled, 2-1, that the EPA may claw back billions of dollars in frozen funds granted to green banks through the Greenhouse Gas Reduction Fund (GGRF). The ruling from the panel stated that in finding for the plaintiffs, the US District Court for the District of Columbia had “disregarded the government’s interest in prudent management of the grant programs and the government’s representations that it planned to properly supervise, rather than abandon, the grantmaking process.” The ruling went on to suggest that the dispute should be heard instead in a federal claims court that considers contract disputes. In her dissent, Judge Cornelia Pillard called the clawback “unprecedented and unfounded” and stated that the green banks had provided ample evidence that the EPA wanted to shut down their programs because it disagreed with their goals. In April, the US District Court for the District of Columbia issued a preliminary injunction barring the EPA from “unlawfully suspending or terminating” the grants and ordering the funds to be disbursed to the three green banks. That order was stayed pending the appeals court’s decision. At this writing, it appears likely that the plaintiffs intend to appeal that decision. See some of our earlier coverage of this case here.

Supreme Court reportedly being urged to hear Boulder climate litigation. The Department of Justice (DOJ) reportedly is urging the US Supreme Court to hear a suit brought by the county commissioners of Boulder County and the City of Boulder charging that two energy companies “intentionally misled the public” about the environmental impact of their products. In May this year, the Colorado Supreme Court ruled that the case, originally filed in 2018, is not preempted by federal law and may proceed in state court. It did not rule on other aspects of the case. The DOJ and a number of other entities, among them the state of Alabama and several members of Congress, reportedly intend to file amicus briefs calling on the Supreme Court to hear the case. In January, the US Supreme Court declined to hear a challenge to a similar ruling from the Supreme Court of the State of Hawaii.

Seeking a new era of stakeholder accountability: International court advisory opinions on climate obligations. As we reported in July, two international courts have issued advisory opinions on climate change, marking a significant evolution in the international legal landscape. These opinions reinforce the binding nature of climate obligations for states. Our alert explores the practical implications of these advisory opinions for businesses.

Taxonomy Day. The General Court of the European Union this month issued two long-awaited, pivotal rulings affecting the EU Taxonomy for Sustainable Activities, a classification system that defines which economic activities are environmentally sustainable in order to drive investment in the energy transition. Both rulings were issued on September 10, which many media observers dubbed Taxonomy Day. Here is information about those rulings:

• EU General Court: European Commission may list nuclear, some gas energy in taxonomy of sustainable investments. Ruling against a complaint by Austria, on September 10 the General Court of the European Union found that when the European Commission included nuclear and gas energy in the EU Taxonomy, it was not breaching its obligations to tackle climate change – a finding that is expected to clear the way for member states and the EU itself to invest in new nuclear facilities. The Commission added specific nuclear and gas activities to the Taxonomy in 2022; later that year, Austria brought its complaint, charging that, in including those activities, the Commission bypassed the legislative process and neglected to carry out an impact assessment. In its ruling this month, the court stated that the Commission “was entitled to take the view that nuclear energy generation has near to zero greenhouse gas emissions and that there are currently no technologically and economically feasible low-carbon alternatives.” The court went on to state that it “endorses the view that economic activities in the nuclear energy and fossil gas sectors can, under certain conditions, contribute substantially to climate change mitigation.” The EU has long been deeply divided over support for nuclear power – Germany, for instance, shuttered the last of its nuclear power plants in 2023 and concentrates on renewables, while France depends on nuclear for its low-carbon strategy and operates Europe’s largest nuclear fleet, generating 70 percent of its electricity. On August 29, in a harbinger of the September 10 ruling, Germany and France adopted a Franco-German Economic Agenda to “ensure non-discrimination among all net-zero and low-carbon energy technologies in their respective contribution to European energy, sustainability, and climate goals” – in essence, pledging not to obstruct each other’s energy activities.


• EU General Court OKs listing of forest biomass burning, bioplastics manufacturing in taxonomy of sustainable investments. Also on September 10, the General Court of the European Union ruled that the European Commission did not err in listing the burning of forest biomass and manufacture of plastics from organic materials in the Taxonomy for Sustainable Activities. This action, brought by the charity ClientEarth in 2022, charged, among other things, that when the European Commission listed those activities in the taxonomy, it was violating the EU’s "do no significant harm" principle. ClientEarth brought its case via the EU’s relatively new internal review procedure, under which environmental NGOs have the right to ask EU bodies to review their own decisions that may have contravened EU environmental law. The process was a long shot for ClientEarth from the start – the Court of Justice has never annulled a negative decision from the EU institutions on substantive grounds in an internal review case.

Supply chain integrity

Germany aims to amend its Supply Chain Due Diligence Act. In late August, Germany’s Federal Ministry of Labor proposed amending the country’s Supply Chain Due Diligence Act (Lieferkettensorgfaltspflichtengesetz, LkSG) to abolish the act’s compliance reporting obligations. Under the proposed changes, certain due diligence obligations would become exempt from administrative fines. The proposal does not alter the LkSG’s due diligence and documentation requirements. The landmark LkSG came into force in 2023 and will remain in force until Germany transposes the EU’s CSDDD (now undergoing its own amendment process) into national law.

Energy and natural resources

Changing energy priorities. The Administration’s January 2025 Executive Order, Temporary Withdrawal of All Areas on the Outer Continental Shelf from Offshore Wind Leasing and Review of the Federal Government’s Leasing and Permitting Practices for Wind Projects, has resulted in a moratorium on federal approvals for new offshore wind projects. In August, the Bureau of Ocean Energy Management (BOEM) ordered a halt to work on the 65-turbine $6.2 billion Revolution Wind project, which was 80 percent complete. (On September 22, the US District Court for the District of Columbia granted the project developers’ motion for a preliminary injunction, finding BOEM’s decision to stop construction unsupported by any evidence of national security concerns.) The Department of the Interior argues that developers failed to provide required documentation detailing how the project would mitigate interference with federal marine fisheries surveys and national defense interests and also mentioned concerns about a "swarm attack" of undersea drones.

Also in August, the IRS released guidance that would make it harder for wind and solar projects to receive tax credits, and Transportation Secretary Sean Duffy withdrew $679 million in federal funding for twelve offshore wind grants and project selections that were not aligned with the goals and priorities of the Administration. The Department of Transportation promises that, where possible, funding from these projects will be recompeted to address critical port upgrades and other core infrastructure needs of the United States. On September 12, the Interior Department asked the US District Court for the District of Maryland to cancel the construction and operations plan (COP) for the 141-turbine Maryland Offshore Wind Project. On September 18, it asked the US District Court for the District of Columbia to revoke the COP for the SouthCoast Wind project off the coast of Massachusetts.

Australia announces new emissions reduction targets. Australian Prime Minister Anthony Albanese has announced new emissions reduction targets intended to, by 2035, slash its GHG emissions by at least 62 percent compared to 2005 levels. Albanese stated on September 18, “This is a responsible target supported by science and a practical plan to get there, built on proven technology.” Australia's first National Climate Risk Assessment, published on September 15, reported that the country has already reached warming of above 1.5C – regarded as a critical threshold beyond which risks to ecosystems and human societies escalate significantly – and concluded that if the government fails to take strong action, no Australian community would be immune from climate threats that will be "cascading, compounding and concurrent.”

Sustainability in financial services

“Fair banking” Executive Order targets politicized debanking and reputational risk. President Donald Trump’s August 7 Executive Order “Guaranteeing Fair Banking for all Americans” broadly prohibits banks and other financial institutions from engaging in politicized or unlawful debanking – essentially, from restricting or denying credit, deposit, or other financial services to customers and potential customers based on political or religious beliefs or lawful business activities. Our alert sets out proactive steps supervised institutions may wish to consider in this evolving landscape.

Zimbabwe aims to launch National Climate Fund. Early this month, Zimbabwe released the draft Climate Change Management Bill, a measure aiming to create a National Climate Fund. That fund would finance projects to mitigate the impact of climate change and respond to climate emergencies, while incentivizing public and private entities to cut their GHG emissions and move to the use of clean energy. According to the Government Gazette, the fund would be financed through levies on carbon trades as well as contributions from extant taxes. Earlier this year, Zimbabwe launched a blockchain-based registry though which developers may trade carbon credits. To date, the country’s Environment Ministry states, more than 100 companies have enrolled on that registry.

EU and ASEAN announce two initiatives to support the green transition in Southeast Asia. The European Union (EU) and the Association of Southeast Asian Nations (ASEAN) have announced two regional programs to promote climate resilience and biodiversity conservation across Southeast Asia. The initiatives, announced on September 4 during the ASEAN-EU Ministerial Dialogue on Environmental and Climate Change in Langkawi, Malaysia, have been designed to support the green transition in Southeast Asia. Under the strategic collaboration, the EU will contribute EUR30 million: EU15 million to support the Nature Solutions Finance Hub, which aims to marshal EU1.5 billion in nature-positive investments by 2030, and another EU15 million to support the ASEAN Small Grants Programme Phase III, which promotes agroforestry and other community-driven conservation efforts. The ASEAN Centre for Biodiversity will contribute another EU5 million to the latter project.

Sustainability in the marketplace

California and Denmark sign climate MOU. In late August, the state of California and the government of Denmark signed a five-year Memorandum of Understanding (MOU) supporting their cooperation on developing the green economy, achieving carbon neutrality by 2045, enhancing climate resilience, and cooperating on technological innovation to support those goals. Speaking at the signing ceremony, Governor Gavin Newsom stated, “Our message to the rest of the world is clear: California is a stable, reliable partner.” See the MOU here.

Lenovo joins Coalition for Sustainable AI. Global technology company Lenovo has joined the Coalition for Sustainable AI, an initiative launched by the government of France, the United Nations Environment Programme (UNEP), and the International Telecommunication Union. The coalition’s website states that its goals are twofold: lessening the ecological impacts of AI and deploying the technology to confront broader environmental challenges. Lenovo, along with numerous other corporations, research institutions, and NGOs, joined CSA early this year during the AI Action Summit in Paris; that development is only being widely reported this month.

Realtor.com’s 2025 Climate Risk Report: 26% of US homes face “severe or extreme climate risk.” Realtor.com’s 2025 Climate Risk Report, issued this month, concludes that mounting climate risks are reshaping US housing markets by driving up the cost, and complexity, of insurance, and that fully 26 percent of American homes – nearly 6 million houses, valued at USD3.4 trillion – are at “severe or extreme climate risk.” These pressures are particularly acute in states like Florida and Louisiana, where premiums can reach record highs, and in wildfire-prone regions, where insurance availability is shrinking. This shift underscores the growing importance of climate risk assessment, insurance strategy, and regulatory compliance for real estate stakeholders and lenders. The findings in the 2025 report, Fortune noted, actually are milder than those in Realtor.com’s 2024 report, which evaluated risks in five areas (flood, wind, wildfire, heat, and air quality) and concluded that 44 percent of US homes worth USD22 trillion were at risk. The 2025 report takes into account only three areas of climate risk – wind, flood, and wildfire. See the report here.

Calendar

Key global reporting deadlines

Click on each icon to learn more.

Coming events

• The IUCN World Conservation Congress takes place October 9-15, 2025 in Abu Dhabi.
• The FAO’s World Food Forum will be held October 10-17, 2025 in Rome and online.
• The 6th World Congress on Agroforestry takes place October 20-24, 2025 in Kigali.
• The European Conference on Climate Change and Environmental Sustainability takes place November 6-7, 2025 in Vienna.
• The 2025 United Nations Climate Change Conference (COP 30) will be held November 10-21, 2025 in Belém.

For professional responsibility reasons, these summaries may not include discussions of developments relating to certain matters.