International Sustainability Updates
SBTi Automotive Net-Zero Standard draft: second public consultation launched
Second public consultation for the SBTi Automotive Net-Zero Standard open until 22nd March.
The SBTi released a draft Automotive Net-Zero Standard which is now open for the second round of public consultation from 3 February to 22 March 2026. The released draft incorporates extensive feedback that was provided by participants in the first round of the consultation and participation in the second round is highly encouraged.
The final Standard will be a new framework for automakers and auto parts manufacturers seeking to set science-based emission reduction targets that are aligned with reaching net-zero by 2050.
GHG Protocol Releases Land Sector and Removals Standard
Long awaited sector-specific standard released by GHG Protocol.
The GHG Protocol has released an accounting standard dedicated to land-sector emissions and carbon removals. The Land Sector and Removals (LSR) Standard will come into force 1 January 2027 and is set to impact a variety of sectors.
For more information see: GHG Protocol Land Sector and Removals (LSR) Standard: What Businesses Need to Know for 2027
First government and public sector climate-related reporting standard launched by IPSASB
A finalised IPSASB SRS 1 standard has been released to support government and public sector climate reporting aligned with IFRS S2.
The International Public Sector Accounting Standards Board (IPSASB) has released its finalised IPSASB SRS1 standard which is aimed at supporting governments and public sector entities in reporting climate-related risks and opportunities. The structure of the standard is similar to IFRS S2, requiring disclosures with the key areas of Governance, Strategy, Risk Management and Metrics and Targets.
Key requirements of the standard include reporting Scope 1, 2 and 3 emissions, disclosing climate related risks and opportunities along with the associated risks and financial consequences, which is to be supported by scenario analysis.
Some key divergences from the IFRS S2 standard include accommodations to address broader stakeholder needs compared to the private sector, the incorporation of public sector terminology and the introduction of a rebuttable presumption on the GHG protocol, which sets the expectation that reporting entities will use the GHG protocol for emissions reporting, unless the rebuttable presumption is invoked in favour of another methodology.
The standard includes transition reliefs, with reporting entities able to avoid the reporting of Scope 3 emissions in the first three annual reporting periods, no requirements for the disclosure of comparative information and for the allowance for first year reporting to be submitted after financial statements have been published.
UK and California sign climate and Energy Memorandum of Understanding
UK and California develop relationship through a collaborative agreement for clean energy and climate resilience.
On 16 February, UK Energy Secretary Ed Miliband and California Governor Gavin Newson signed a Memorandum of Understanding with the objective to establish a joint framework to address global decarbonisation, climate resilience and the exchange of technology and scientific knowledge.
Specific areas of collaboration include developing clean energy technologies and systems, such as renewable energy, storage solutions and grid infrastructure; financing clean energy and climate resilience; carbon and pollution management, such as ETS programmes and GHG removals and storage; transport decarbonisation; and environment, agriculture and resilience which covers biodiversity, water, agriculture and waste management.
EU Sustainability Updates
EU legally bind carbon reduction target of 90% by 2040
The proposed 90% emissions reduction target has bound into law by majority vote.
On 10th February 2026, the EU Parliament voted to legally bind the previously proposed target of a 90% reduction in emissions by 2040. This was backed by a majority vote of 413 to 226. From 2036 onwards, a maximum of 5% of reduction is permitted to come from high quality internation offsets and the use of domestic permanent carbon removals has been included as a possibility for hard to abate sectors as included in the ETS.
This target will be assessed every other year, to consider feasibility against the latest science and technology, energy prices, and EU industrial competitiveness. Upon review, a proposed amendment may be made by the Commission, either modifying or strengthening the target.
EU sets world first voluntary rules for certifying permanent carbon removals
Certification Framework for Carbon Removals and Carbon Farming announced for consistency in carbon removals across the EU.
Standards due to be laid out under EU’s Carbon Removals and Carbon Farming (CRCF) certification framework were announced in early February. These govern how permanent carbon removal activities should be assessed by certifiers EU wide with the aim to improve consistency and comparability of carbon removal credits across the bloc.
The rules are set to cover three permanent removal types, direct air capture with carbon storage, biogenic emissions capture with carbon storage and biochar carbon removal. The voluntary framework looks to standardise approaches to removals quantification, risks and demonstration of permanence, the adoption of which may be supported by purchase of CRCF aligned credits by the EU in future years, although this is still under consideration.
If no objections are raised during the scrutiny period, the regulations are expected to be published around the end of April, enabling certification schemes to apply for recognition by the EU commission though the CRCF methodologies.
France Announces New Strategy for Energy and Climate
France’s bold decarbonisation strategy to exit coal by 2030 and gas by 2050.
France has announced a new decarbonisation strategy, ‘Programmation pluriannuelle de l’énergie’ (PPE), which lays out ambitious plans with main objectives reducing its total energy by 50% and achieve carbon neutrality by 2050. The strategy also considers energy security, energy optimisation and socio-economic factors largely related to consumer cost.
To move away from fossil fuels, France intends to expand its nuclear and renewable energy production. The inclusion to expand nuclear is controversial due to costs and the heavy reliance on nuclear over renewables. However, Finance Minister Roland Lescure backed the PPE stating that “Nuclear is the backbone of our electrical system” and “we need both nuclear and renewables [to decarbonise the energy sector]”.
US Sustainability Updates
New York introduces Climate Bill
The second US state to implement mandatory quantification of carbon emissions for businesses with revenue over $1 billion.
On 10 February 2026, the New York Senate passed Senate Bill S9072A, also known as the Climate Corporate Data Accountability Act. This bill, similar to that of SB 253 in California mandates the quantification of Scope 1, 2 and 3 emissions for businesses with a total revenue greater than $1 billion.
This is yet to be written into law by the state Governor as it must go through the assembly first, however it is anticipated to be a phased approach with Scope 1 and 2 for 2027 reported in 2028 and Scope 1, 2 and 3 for 2028 in 2029. It is likely to also require limited assurance for 2028 reporting before moving to reasonable assurance in 2032.
Submission to a digital portal is required with penalties being handed out for non-compliant companies.
US revoking GHGs as threat to human health
EPA repealed the ruling that GHGs are a threat to human health.
On 12 February 2012, President Trump announced what was described as the “single largest deregulatory action in U.S. history” as the Environmental Protection Agency (EPA) repealed the ruling that greenhouse gasses (GHGs) are a threat to human health, predicted to save $1.3 trillion in lower costs across cars and industrial products. This ruling was first put in place in 2009 and allowed the EPA to spearhead federal GHG reduction efforts.
For more information see: U.S. Revokes EPA GHG Endangerment Finding | Business Impact
US judge declares Texas anti-ESG Law as ‘unconstitutional’
“SB13’s definition of ‘boycott energy companies’ permits the state to penalize companies for all manner of protected expression concerning fossil fuels” – Judge Albright.
In early February, District Judge Alan Albright declared that a 2021 Texas Law (SB 13) had violated the first amendment (Freedom of Speech) by punishing businesses for speaking about fossil fuels. SB 13 restricted state investments in companies that aimed to reduce reliance on fossil fuels or spoke about boycotting the fossil fuel industry. Since its enforcement in 2021, it has forced some state pension funds to sell asset management shares that were linked with efforts to slow the effects of climate change. Texas plans to appeal this decision.
UK Sustainability Updates
UK government publish Sustainability Reporting Standards (SRS)
UK SRS final SRS Standards released in line with IFRS reporting
On 25th February 2026 the UK Government released the final IFRS aligned Sustainability Reporting Standards (SRS). SRS 1 sets out general guidelines for applying the standards and general sustainability-related risks and opportunities. SRS 2 focuses on climate-related risks and opportunities and requires reporting on governance; strategy including risks and opportunities and climate resilience; risk management; and metrics and targets.
Metrics to report on include:
- Scope 1, 2 and 3 emissions
- calculation methods
- physical and transition risks
- internal carbon pricing and remuneration
While largely aligned with IFRS, UK SRS has made certain amendments. One main divergence is that time references have not been included for Scope 3 and climate first reporting reliefs.
UK FCA consults on reporting requirements for listed companies
A consultation is in progress regarding requirements for UK listed companies to report in line with IFRS standards.
The UK Financial Conduct Authority is consulting on an expanded set of sustainability requirements for listed companies. This would include reporting aligned with the recently released SRS standards and significantly increase current requirements, including the notably more involved Scope 3 reporting. The outcome of the consultation is expected to be announced in announced later in the year with the possibility of new rules coming into effect at the start of 2027.
Britain secures record levels of new renewable energy projects
During the latest renewables auction this month, Britain secured record levels of new solar, onshore wind and tidal projects, putting the UK on track for reaching its 2030 clean power target.
Included in this is the largest successful onshore wind project in England in a decade following the onshore wind ban. Combined with January’s offshore wind sourcing, the UK government has secured 201 renewable energy projects so far in 2026 that will generate 14.7 GW of clean power, enough energy to supply the equivalent of 16 million homes.
UK Heat Pump Sales reach ‘record high’
The Heat Pump Association (HPA) UK recorded 125,037 heat pumps as sold in the UK in 2025.
This represents a 27% increase since 2024, with increases across every category of heat pump.
However, the rate of increase did reduce in comparison to 2024. Analysis by the HPA project heat pumps in use across the UK to increase to 2.5 million by 2030 and 9.3 million by 2035. This is a significant increase from the 0.5 million in 2025 and is expected to have a significant impact on residential space heating emissions, with savings of 17 million tCO 2 e, roughly one third of the sectors emissions.