The past month brought a wave of important ESG and sustainability regulatory updates across multiple regions, underscoring the rapid pace at which expectations are evolving for multinational businesses. From California’s climate disclosure mandates to Europe’s refinements of corporate reporting standards and New Zealand’s proposed modern slavery laws, companies are facing mounting obligations to demonstrate credible, consistent, and transparent practices on climate, human rights, and environmental claims.

Greenwashing Scrutiny Intensifies

Regulators around the world are increasing oversight of “green” marketing claims. Even technically accurate statements are coming under fire if they omit key facts or leave consumers with a misleading impression. This means businesses need to ensure all environmental messaging is backed by robust, documented evidence. Internal review systems and employee training will become critical tools to mitigate litigation risk and regulatory enforcement.

Supply Chain Due Diligence in Transition

Germany’s Supply Chain Due Diligence Act (Lieferkettensorgfaltspflichtengesetz, or LkSG) is poised for reform. Draft amendments propose eliminating the requirement for an annual public report and narrowing enforcement obligations for upstream suppliers. If adopted, these changes would ease compliance burdens for U.S.-based multinationals with German operations while maintaining the law’s focus on addressing human rights risks in global supply chains.

California’s Climate Disclosure Push

California continues to lead in climate-related reporting. The California Air Resources Board (CARB) issued draft guidance under Senate Bill 261, outlining how companies should prepare climate-related financial risk reports. The draft clarifies reporting scope, assurance considerations, and practical compliance steps. At the same time, CARB published a preliminary list of companies potentially falling short of SB 261’s requirements—an early indicator of more active oversight and enforcement.

Expanding Global Human Rights Reporting

New Zealand has introduced two competing legislative proposals on modern slavery disclosures. One bill would apply broadly to large entities across the economy, while the other would impose narrower but more prescriptive requirements. Both signal a trend toward mandatory transparency on labor and supply chain risks, aligning New Zealand with similar regimes already in place in Australia, the UK, and the EU.

Europe Refines CSRD and ESRS Timelines

Across the European Union, the Corporate Sustainability Reporting Directive (CSRD) remains a centerpiece of sustainability regulation. To help manage implementation challenges, several member states have adopted the “stop the clock” directive, delaying certain reporting deadlines. Meanwhile, the European Financial Reporting Advisory Group (EFRAG) continues to revise the European Sustainability Reporting Standards (ESRS) to simplify reporting without losing core policy objectives. This mix of delay and revision reflects a balance between regulatory ambition and practical feasibility.

U.S. ESG Compliance Heats Up

In the U.S., ESG disclosure is also advancing on multiple fronts. Regulators are sharpening scrutiny of fund naming conventions, greenwashing risks, and climate disclosures. Combined with active litigation, these developments highlight the increasing exposure companies face if disclosures are inconsistent or overstated. Executives should expect that scrutiny of ESG claims will only expand, demanding stronger alignment between compliance, legal, and communications teams.

Key Takeaways for Executives

The common thread across these developments is clear: ESG and climate-related regulation is not slowing down, but becoming more complex and closely monitored. Multinationals should strengthen internal controls for marketing claims, prepare for climate risk disclosures in California, track evolving timelines in Europe, and anticipate growing obligations around human rights transparency in supply chains. Those who take a proactive approach—by aligning reporting with international standards, coordinating across functions, and building defensible evidence behind claims—will be best positioned to manage both compliance and reputational risks in this rapidly evolving landscape.