Navigating Regulatory Compliance in Science

Spain has just taken ESG into their own hands. The ESG regulatory landscape is becoming increasingly complex, not less. This year, we have seen the EU's "Omnibus" package as a major simplification, reducing the scope of CSRD and delaying timelines. Spain is now moving in the opposite direction. The Spanish government has just approved a new "Climate Emergency Plan," Here are the key details: ↳ Mandatory Carbon Reporting: Companies must begin reporting Scope 1 & 2 emissions in 2026 (for 2025 data). ↳ Scope 3 Phase-In: Larger entities will be required to include Scope 3 (value chain) emissions starting from 2028. ↳ Action Plans Required: Businesses will also need to submit concrete greenhouse gas reduction plans with a minimum five-year horizon. ↳ Resilience Measures: The plan goes beyond reporting, establishing a new national agency for civil protection and introducing stricter land-use and forest management rules to build climate resilience. Brussels is attempting to streamline and reduce the reporting burden to make it more effective and enhance global competitiveness. At the same time, individual member states, such as Spain, are pushing ahead with their own ambitious and legally binding national climate laws. The Omnibus sets the floor, but it doesn't set the ceiling. We are entering an era of multi-speed regulation, where companies will have to navigate a complex patchwork of EU directives and more stringent national laws. Does this fragmentation create a compliance nightmare, or does it allow climate-leading nations to raise the bar for everyone?

NEW ANALYSIS: Meeting European climate goals will require a stark contraction in fossil gas use. But in many countries gas grid planning is based on the assumption of infinite gas grid use. Despite the substantial implications for gas grid users and infrastructure, current grid planning does not adequately reflect this new reality. This misalignment poses a substantial barrier to the transition towards a sustainable energy system and underscores the need for more holistic planning. Alignment of energy infrastructure planning with other planning processes could better support climate and social goals. Regulations regarding heat planning, for instance, have significant consequences for gas grid infrastructure development, heating appliance regulations and consumer burdens. Infrastructure planning processes also do not yet address the support needed to ensure vulnerable energy users are able to fully participate in the transition to cleaner, more efficient technologies. Our study provides comprehensive information on the current state of the gas grid, its development, and the regulatory framework in selected European countries, and identifies current regulatory barriers for the phase-out of fossil gas. It concludes with recommendations on how Member States could better align energy infrastructure planning with the attainment of national and EU climate targets: - Adopt a national phase-out target and give energy regulators a net zero mandate. - Make the regulatory framework fit for the gas phase-out. - Adopt integrated heat and grid planning. - Plan future gas infrastructure based on realistic assumptions about future availability of zero-carbon heating technologies. - Track and collect harmonised data at the EU level. - Protect vulnerable customers. More in our Regulatory Assistance Project (RAP) & Oeko-Institut e.V. report released today.

Of all the challenges I have seen emerge in recent years, sustainability is the one that most demands structured thinking. Too often, companies take isolated actions—launching an initiative here, cutting emissions there—without stepping back to look at the full landscape. But sustainability is not just about doing better; it is about making smart, coordinated choices in a complex and fast-moving context. This visual framework outlines four key questions that leaders should ask themselves: - What is the lay of the land? Understanding expectations, risks, and competitive signals is the starting point. You cannot navigate without a map. - Where do we need to go, and how fast? Clarity of ambition and pace is essential. Without it, even the best intentions can drift. - What will it take to get there? Strategic transformation means rethinking products, business models, and resource flows. - How must we act now? Organizational culture, innovation paths, and stakeholder communication must be aligned to sustain momentum. These questions help shift the focus from compliance and reputation to real value creation. Sustainability, when approached strategically, becomes a driver of long-term business resilience. It is time we treat it as a business question, not just an ethical one. #Sustainability #Leadership #BusinessTransformation

Two continents. Two legal realities. One climate crisis. 🌎 A stark divide is emerging in how courts on either side of the Atlantic are approaching climate action—and it’s putting global companies in a legal and strategic bind. In Europe, lawsuits are being filed against companies for not doing enough to address climate change. ING, the largest Dutch bank, is now facing legal action over the climate impact of its investment portfolio. The argument: large financial institutions must align with the Paris Agreement and take responsibility for financed emissions. Meanwhile in the U.S., the situation is inverted. Companies and nonprofits are being sued for doing too much. BlackRock and others have faced accusations of breaching fiduciary duties by factoring climate risks into investment decisions. Greenpeace was recently ordered to pay millions in a case brought by a pipeline company. The message: stay in line with fossil fuel interests—or face the consequences. This growing legal polarization reflects more than political division—it underscores the shrinking room for neutrality. Companies with operations in both regions are now navigating conflicting regulatory signals, stakeholder expectations, and legal frameworks. But staying silent is not a strategy. As expectations rise, the need for a clear, principled, and well-grounded sustainability position becomes not only a moral imperative—but a business one. Regulatory uncertainty will persist. Reputational risk will rise. And litigation—on both sides—will continue. But inaction is no longer the safest option. #sustainability #sustainable #business #esg #climatechange

As an auditor assessing a client's greenhouse gas (GHG) accounting practices, sources, emissions mitigation efforts, and other related areas, you should ask a comprehensive set of questions to gain a thorough understanding of their practices and ensure compliance with relevant standards. Here are some key questions you might consider: #GHG Accounting Practices 1. GHG Inventory Scope and Boundaries - What are the organizational and operational boundaries defined for your GHG inventory? - How do you determine which GHG sources are included in your inventory? - Do you follow any specific standards or frameworks for #GHGaccounting (e.g., #GHGProtocol)? 2. Data Collection and Management - What processes are in place for collecting and managing GHG data? - How do you ensure the accuracy and completeness of your GHG data? - What tools do you use for GHG data collection and management? 3. Verification and Validation - How often do you verify and validate your #GHGdata? - Do you use third-party verification for your GHG inventory? Details? Documentation? #GHGSources - What are the primary sources of GHG emissions within your operations (e.g., stationary combustion, mobile sources, process emissions)? - How do you identify and categorize different GHG sources? 2. Emission Factors and Calculations - What emission factors do you use for calculating GHG emissions from various sources? - How often are these emission factors updated and reviewed? 3. Scope 1, 2, and 3 Emissions - How do you account for #Scope1 (direct) emissions? - How do you account for Scope 2 emissions? - How do you track and report #Scope 3 emissions? GHG Emissions Mitigation Efforts 1. Mitigation Strategies and Targets - What strategies have you implemented to reduce GHG emissions? - Have you set specific GHG reduction targets? If so, what are they and what is the timeline for achieving them? 2. Performance Tracking and Reporting - How do you measure and track the effectiveness of your emissions reduction efforts? - Do you publicly report your GHG emissions and reduction progress? 3. Renewable Energy and Efficiency Improvements - Have you implemented any renewable energy projects or #energyefficiency improvements. Regulatory Compliance - Are you in compliance with all relevant local, national, and international GHG regulations and reporting requirements? - Can you provide documentation of your compliance status and any regulatory filings? Risk Management and Adaptation - How do you assess and manage risks related to #climatechange and GHG emissions? 3. Stakeholder Engagement - How do you engage with #stakeholders on #GHGemissions and climate-related issues? - What are your future plans for enhancing your GHG accounting and mitigation practices? These questions will help you gather a comprehensive understanding of the client's GHG accounting and management practices.

Guidance on Climate Transition Plans under ESRS For organisations navigating climate reporting and sustainability compliance, the new guidance on implementing climate transition plans under the European Sustainability Reporting Standards (ESRS) provides valuable support! The guidance provides an approach for organisations to meet the ESRS requirements by detailing disclosure obligations that align with key EU regulations, such as the Corporate Sustainability Due Diligence Directive (CSDDD) and the EU Taxonomy. This alignment helps ensure climate transition activities and sustainability disclosures meet broader European compliance standards, reinforcing their commitment to responsible and sustainable practices in line with EU legislation. 1️⃣ Purpose: Offers non-binding guidance to help organizations create effective transition plans for climate change mitigation. 2️⃣ Compliance: Maps out how ESRS aligns with EU laws like the Corporate Sustainability Due Diligence Directive (CSDDD) and EU Taxonomy, ensuring regulatory alignment 3️⃣ Structure: Covers all aspects of climate disclosure—from European frameworks and disclosure requirements to international standards 4️⃣ Paris Agreement Alignment: Organizations must disclose targets that align with the 1.5°C goal, showing commitment to global climate efforts 5️⃣ Decarbonization: Outlines required emissions reduction actions, including operational changes and product modifications. Organisations are required to outline specific actions, known as "decarbonization levers," which may include operational adjustments, product changes, and other emissions reduction initiatives 6️⃣ Investments: Specifies the need for transparent reporting on investments, including EU Taxonomy-aligned CapEx for sustainable projects 7️⃣ Disclosures: Companies involved in EU Taxonomy activities must show their alignment with taxonomy criteria for sustainable finance 8️⃣ Governance: Transition plans should be embedded within overall corporate strategy, backed by governance bodies to ensure alignment with broader goals 9️⃣ Progress: Regular updates on implementation are required, measuring action effectiveness toward emissions targets 🔟 IROs from climate change mitigation: The guidance stresses the need for organisations to assess and disclose social and environmental impacts, risks, and opportunities linked to their climate transition plans The guidance emphasises that climate transition plans should be fully embedded within a company's overarching strategy and be actively supported by governance bodies. This integration ensures that climate goals are not treated as standalone objectives but are interwoven with long-term corporate planning. By doing so, organisations can align their climate ambitions with their overall business objectives, securing strategic and governance-level commitment to climate action.

📢 Exciting news! Just finished reading a fascinating report titled "Norwegian CCS: What have we learned?" authored by Raeid Jewad, Bassam Fattouh, and Hasan Muslemani from the Oxford Institute for Energy Studies. This report offers valuable insights into Norway's journey in implementing Carbon Capture and Storage (CCS) and its impact on the Norwegian economy. Here are some key takeaways: 1️⃣ Norway's success in implementing CCS can serve as a guide for other countries with plans for CCS policies. The factors contributing to Norway's success include vast offshore CO2 storage resources, a supportive government approach and strategy, a robust regulatory and licensing regime, government funding, a commercial framework, cross-border transportation of CO2, and public acceptance. 2️⃣ Robust Regulatory and Licensing Regime: Norway's success in implementing CCS can be attributed to its robust regulatory and licensing regime. The government has established clear guidelines and frameworks for CCS projects, ensuring safety, environmental protection, and effective monitoring of CO2 storage sites. 3️⃣ Market and Commercial Framework: Norway has developed a commercial framework that incentivizes CCS deployment. The government provides funding and financial support for CCS projects, making them economically viable. Additionally, the establishment of a market for CO2 certificates creates a revenue stream and encourages investment in CCS technologies. 4️⃣ Legislative Support: Norway's strong legislative support has played a crucial role in the development of CCS. The government has introduced policies and measures to promote CCS, aligning with national climate goals. This legislative support creates a favorable environment for CCS implementation and encourages industry participation. 5️⃣ Cross-Border Collaboration: Norway has actively engaged in cross-border cooperation and bilateral agreements for the transportation and storage of CO2. This collaboration enhances the viability of CCS projects by enabling the sharing of infrastructure and resources, fostering international partnerships, and supporting knowledge exchange. The robust regulation, market, and legislation in Norway provide a solid foundation for the successful implementation of CCS projects. These factors contribute to the country's leadership in CCS technology and offer valuable lessons for other countries aiming to develop their CCS capabilities. This report is a must-read for policymakers, industry professionals, and researchers interested in understanding the regulatory, market, and legislative aspects of CCS implementation. It sheds light on the challenges and opportunities of CCS and its role in achieving climate goals and supporting economic growth. #CCS #CarbonCaptureandStorage #Norway #Regulation #Legislation #MarketFramework #ClimateAction #EnergyTransition

⚠️𝗦𝘄𝗶𝘁𝗰𝗵𝗶𝗻𝗴 𝗖𝗢₂ 𝗦𝗼𝘂𝗿𝗰𝗲𝘀: 𝗔 𝗥𝗲𝗴𝘂𝗹𝗮𝘁𝗼𝗿𝘆 𝗣𝗮𝗿𝗮𝗱𝗼𝘅 𝗛𝗼𝗹𝗱𝗶𝗻𝗴 𝗕𝗮𝗰𝗸 𝗲𝗦𝗔𝗙 𝗙𝗜𝗗 While policymakers continue to broadcast unwavering support for the scale-up of eSAF production, investment decisions remain scarce. The ambition to establish a thriving market is clashing with regulatory uncertainty and financial risk. Nowhere is this more apparent than in the carbon feedstock dilemma—a seemingly technical requirement that threatens the economic viability of industrial-scale eSAF plants. 🚧A Timeline That Doesn't Add Up A realistic project timeline sees FID in late 2025 and operations starting no earlier than 2030. Given the capital intensity of these projects, investors and lenders expect a plant lifetime of at least 15–25 years—in line with the depreciation cycles of key industrial assets. ⚠️Yet, a critical contradiction emerges: Current regulations temporarily allow the use of recycled fossil carbon, but from 2041 onwards, plants must switch to biogenic CO₂ sources. In practical terms, this implies that an eSAF plant designed with a multi-decade investment horizon may face an existential feedstock disruption after just 10 years, far before financial viability is achieved. 🚫Investment Logic vs. Regulatory Design This isn’t just an inconvenience—it’s a fundamental misalignment between investment logic and policy design. No investor will commit to capital-intensive infrastructure if its core feedstock is legally restricted halfway through its operational life. The Delegated Act governing RFNBOs allows RED-compliant biogenic CO₂ indefinitely, while fossil-derived CO₂ is phased out by 2041. As a result, plants launching in 2029–30 may only operate for a decade before needing an alternative CO₂ source, effectively cutting the economic lifespan of key components in half. With most e-fuel production assets designed for a 20–30-year operational lifetime, developers must either secure biogenic CO₂ sources now or risk premature obsolescence. Meanwhile, biogenic CO₂ faces intense competition from shipping, chemicals, plastics and construction industries. 🚧A Technically and Financially Unviable Transition The assumption that plants can seamlessly transition from fossil-based CO₂ to biogenic sources after 2041 is deeply flawed. Fischer-Tropsch (FT) synthesis—the core process behind eSAF—requires feedstock homogeneity and CO2 purity, making a switch in CO₂ sources anything but straightforward. A dual-sourcing model or gradual blending strategy seems nearly impossible without costly modifications, as it requires catalyst recalibration and expensive retrofittings, further eroding already fragile eSAF economics. 🚨The Market Stalemate Continues 🔹The feedstock exists. 🔹The technology exists. 🔹The capital exists. 🔹The political rhetoric exists. Yet, with the handbrake still engaged, eSAF investments remain frozen in uncertainty—until regulations align with financial and technical realities. #eSAF, #greenCO2

Draft Implementation Guidance on Transition Plan for Climate Change Mitigation published on #EFRAG website. Nice and timely 🤪 The below summary is all in yellow, which apparently means that it is contextualising, raising questions on text proposed or text that is still to be reviewed with stakeholders. 1. Purpose and Scope: This guidance provides non-authoritative support for undertakings in implementing #transitionplans for #climatechange mitigation, as required under the #ESRS. 2. Regulatory Compliance: The document details ESRS disclosure requirements, linking them to EU laws like the #CSDDD and #EUTaxonomy, among others. 3. Structure: The guidance is structured into multiple chapters, covering the European framework, specifics of disclosure requirements for climate transition plans, connections to other European regulatory frameworks and international standards and Frequently Asked Questions (FAQs). 4. Target compatibility: Undertakings must disclose their #targets and explain how they are compatible with the 1.5°C target set by the Paris Agreement. 5. Actions and Decarbonization levers: Undertakings must describe the #decarbonizationlevers, such as operational and product adjustments, that support #emissions reduction. 6. Investment and funding: They are also required to disclose investments and funding supporting these plans, including EU Taxonomy-aligned CapEx. 7. Supporting disclosures: Undertakings conducting activities covered by the EU Taxonomy for #sustainablefinance must disclose their alignment with taxonomy criteria. This includes climate-related objectives and compliance with technical screening criteria. 8. Governance and strategy: The document emphasises that climate transition plans must be embedded in a undertaking’s overall strategy, with explicit support from governance bodies. This ensures alignment between sustainability goals and corporate planning. 9. Progress Reporting: Undertakings are required to provide updates on the progress of implementing their transition plans. This includes tracking the effectiveness of planned actions and their contribution toward emission reduction targets. 10. #IROs arising from the transition plan for climate change mitigation: The guidance highlights the importance of considering social and #biodiversity impacts, risks and opportunities connected to the climate transition plan. Undertakings must disclose how transition plans may affect workers, communities, and #ecosystems and may be dependent from its adaptation actions. 

𝗖𝗮𝗹𝗶𝗳𝗼𝗿𝗻𝗶𝗮 𝗔𝗶𝗿 𝗥𝗲𝘀𝗼𝘂𝗿𝗰𝗲𝘀 𝗕𝗼𝗮𝗿𝗱 (𝗖𝗔𝗥𝗕) 𝗵𝗮𝘃𝗲 𝗿𝗲𝗹𝗲𝗮𝘀𝗲𝗱 𝗮 𝗰𝗵𝗲𝗰𝗸𝗹𝗶𝘀𝘁 𝘁𝗼 𝘀𝘂𝗽𝗽𝗼𝗿𝘁 𝗰𝗼𝗿𝗽𝗼𝗿𝗮𝘁𝗲 𝗰𝗹𝗶𝗺𝗮𝘁𝗲 𝗿𝗶𝘀𝗸 𝗰𝗼𝗺𝗽𝗹𝗶𝗮𝗻𝗰𝗲. Starting in 2026, many US companies doing business in California must biennially disclose their climate-related financial risks under Senate Bill 261. The California Air Resources Board (CARB) has now released a draft checklist to guide these disclosures. This new checklist helps companies prepare their first report, due on 𝗝𝗮𝗻𝘂𝗮𝗿𝘆 𝟭, 𝟮𝟬𝟮𝟲. The guidance is a baseline for disclosure. It is largely based on the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). 𝗧𝗛𝗘 𝗙𝗜𝗩𝗘 𝗣𝗢𝗜𝗡𝗧 𝗖𝗛𝗘𝗖𝗞𝗟𝗜𝗦𝗧 𝟭. 𝗣𝗶𝗰𝗸 𝗮 𝗥𝗲𝗽𝗼𝗿𝘁𝗶𝗻𝗴 𝗙𝗿𝗮𝗺𝗲𝘄𝗼𝗿𝗸 Select a framework for reporting climate-related risks and opportunities. Reports may follow TCFD or International Sustainability Standards Board (IFRS S2) or other governmental standards. A report should contain a statement on which reporting framework is being applied, and which recommendations and disclosures have been compiled. 𝟮. 𝗚𝗼𝘃𝗲𝗿𝗻𝗮𝗻𝗰𝗲 Disclosures should describe the organisation's governance structure for identifying, assessing, and managing climate-related financial risks. 𝟯. 𝗦𝘁𝗿𝗮𝘁𝗲𝗴𝘆 The report should describe the actual and potential impacts of climate-related risks and opportunities on a company's operations, strategy, and financial planning. 𝟰. 𝗥𝗶𝘀𝗸 𝗠𝗮𝗻𝗮𝗴𝗲𝗺𝗲𝗻𝘁 The disclosures should describe how the reporting entity identifies, assesses, and manages climate-related risks and how those processes are integrated into the organisation's overall risk management. 𝟱. 𝗠𝗲𝘁𝗿𝗶𝗰𝘀 𝗮𝗻𝗱 𝗧𝗮𝗿𝗴𝗲𝘁𝘀 The report must disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities. 𝗠𝘆 𝗧𝗮𝗸𝗲 This checklist brings clarity to a complex mandate. It sets minimal expectations for companies navigating these new reporting requirements. Companies should not wait for the final rules to be published. They should proactively prepare for compliance by assembling a cross-functional team, identifying existing data, and assessing reporting gaps. Organisations should integrate climate-related risk management into their overall risk management framework. Viewing climate change with the same rigour as any other strategic risk is a forward-looking practice that will build resilience and support investor confidence. For support with meeting SB261 requirements, please get in touch. #ClimateRisk #Sustainability #ESG #CorporateGovernance #Regulation #California #Finance TCFD Source: https://lnkd.in/eWp5ERuX ___________ 𝘍𝘰𝘭𝘭𝘰𝘸 𝘮𝘦 𝘰𝘯 𝘓𝘪𝘯𝘬𝘦𝘥𝘐𝘯: Scott Kelly