A Global Supply Chain Sustainability Regulations Guide for 2025
- Laura V. Garcia
- Sep 10, 2025
- 30 min read
Updated: Sep 22, 2025
Transparency Note: This guide was developed with the aid of AI for research and content generation. I have applied my professional expertise throughout the process, and a list of sources is provided to enable your own verification.
The clock is ticking—and the stakes are high. As of mid-2025, more than 5,000 climate-related laws and policies are in force worldwide, according to the Climate Change Laws of the World database maintained by the Grantham Research Institute at LSE. The costs of noncompliance are steep: fines in the millions, investor pullback, reputational damage, and loss of access to sustainable finance (ESG-linked investment and financing).
This guide—while not exhaustive—focuses on select, high-impact regulations that define today’s core legal expectations for sustainability and supply chain responsibility, highlighting the frameworks most critical to boards and supply chain leaders.
Guide Scope
Categories covered: Human and labor rights, due diligence, environment and climate change, sustainable business practices, trade and market access, waste and resource management.
Regions covered: Europe, North America, Asia-Pacific, the Middle East, India, Japan, South America (Brazil, Chile, Colombia), and Africa (South Africa, Kenya, Nigeria).
Global
Sustainable Business
The global sustainability reporting landscape is anchored by two frameworks: the IFRS Sustainability Disclosure Standards (IFRS S1 & S2) and the Global Reporting Initiative (GRI) Standards. Though not legally binding, they are so widely adopted—and so central to mitigating risks such as fines, investor pullback, and loss of sustainable finance—that they effectively operate as de facto regulations. While separate, they are designed to be complementary, providing a comprehensive view of a company’s sustainability performance from both a financial and impact perspective.
Purpose and Audience
IFRS S1 and S2 focus on enterprise value. Their primary goal is to provide information to investors, lenders, and other creditors about how sustainability-related risks and opportunities affect a company's financial prospects and value over the short, medium, and long term.
GRI Standards focus on impacts on people and the planet. Their goal is to provide information to a broad range of stakeholders, including civil society, employees, and governments, about a company's significant impacts on the economy, environment, and people.
Key Concepts
The core distinction lies in their approach to materiality:
IFRS S1 & S2 are based on financial materiality, meaning a company must disclose sustainability information that is financially relevant to its business.
GRI Standards are based on impact materiality, meaning a company must disclose its most significant impacts on the world, regardless of whether those impacts are financially material to the business.
This dual perspective is often referred to as double materiality and is a key concept in other major regulations, such as the EU's Corporate Sustainability Reporting Directive (CSRD).
Relationship and Interoperability
The IFRS Foundation and GRI have been working to ensure interoperability, allowing companies to use both sets of standards efficiently.
Complementary Disclosures: The two organizations have published joint statements clarifying how companies can use both standards together to meet the needs of both investors and broader stakeholders.
Equivalence: GRI has granted equivalence to IFRS S2, which allows companies to use a single set of greenhouse gas emissions disclosures from IFRS S2 to meet the corresponding requirements in the updated GRI 102 Climate Change Standard. This new standard, approved in June 2025, will come into effect on January 1, 2027.
Summary: GRI Standards are the world's most widely used voluntary framework for sustainability reporting. They guide companies to report on their impacts on people and the planet, which helps a broad range of stakeholders—including civil society, investors, and governments—understand a company’s contributions to sustainable development.
Who is impacted?
The standards are designed to be flexible and applicable to any organization, regardless of size, sector, or location. While voluntary, over 73% of the world's 250 largest companies use them. This widespread adoption is driven by the need to meet stakeholder demands, manage reputational risks, and prepare for evolving regulatory landscapes.
Recent updates:
GRI's standard-setting process is continuous, with key updates since 2025 focusing on:
New Sector Standards: GRI has been developing new, sector-specific standards for high-impact industries like mining and coal, with reporting expected to be mandatory from 2025 for companies using the GRI framework.
Climate and Energy Standards: New climate and energy standards, GRI 102 and GRI 103, were released in mid-2025 to align better with other key frameworks, including the International Sustainability Standards Board (ISSB) and the European Sustainability Reporting Standards (CSRD). These updates include new disclosures on topics like "just transition" and the use of carbon credits.
Focus on Materiality: GRI continues to emphasize the concept of double materiality, which requires companies to report not just on how sustainability issues affect their business financially, but also on how their business operations impact the environment and society. This aligns with a core principle of the European Union's Corporate Sustainability Reporting Directive (CSRD).
Enforcement and resources:
As a voluntary standard, GRI does not enforce compliance or impose penalties itself. However, many jurisdictions and mandatory frameworks, such as the EU’s CSRD, are built with GRI in mind. This means companies using GRI standards may already be well-prepared to comply with new regulations, as their data and reporting practices are often highly interoperable.
Official GRI Standards Website: The official source for all GRI standards and guidance documents.
GRI and ISSB Interoperability: An official statement on the ongoing collaboration between GRI and the ISSB to ensure reporting interoperability.
GRI Climate-Related Disclosures: Resources related to the latest updates to GRI's climate and energy standards.
Impact and penalties:
The impact of non-compliance with GRI is primarily reputational and market-driven. Organizations that fail to report, or are found to have inaccurate disclosures, may face a loss of investor confidence, negative public opinion, and reduced access to capital from financiers focused on ESG performance.
Summary: IFRS S1 and S2 are two global sustainability reporting standards developed by the International Sustainability Standards Board (ISSB), a sister board to the International Accounting Standards Board (IASB) under the IFRS Foundation. IFRS S1 outlines the general requirements for disclosing sustainability-related financial information, while IFRS S2 specifies the disclosures for climate-related risks and opportunities. Both standards are designed to provide investors with a globally consistent and comparable baseline of information to inform their investment decisions.
Who is impacted?
The standards are intended for companies in jurisdictions that have decided to make them mandatory, with reporting periods generally beginning on or after January 1, 2024. While Australia, New Zealand, and Singapore are indeed adopting the standards, the number of jurisdictions is constantly growing. As of mid-2025, over 35 jurisdictions have either adopted, or are in the process of adopting, the standards.
Recent updates:
Since their issuance in June 2023, the ISSB has been focused on supporting the adoption and implementation of the standards. Recent updates include:
Proposed enhancements to the SASB standards and consequential amendments to IFRS S2, which were opened for public feedback in July 2025.
Publication of educational material and guidance to support companies in applying the standards, including a guide for companies that only wish to report climate-related information.
Ongoing work on the ISSB's 2024-2026 work plan, which includes new projects.
Enforcement and resources:
The enforcement and specific dates of implementation, vary by country. For example, Australia is taking a phased approach with different effective dates for large, medium, and small companies. Hong Kong and Singapore have also set specific effective dates. The official source for all standards and guidance is the IFRS Foundation, which has a dedicated IFRS Sustainability Disclosure Standards Navigator and a Knowledge Hub.
Impact and penalties:
The impact and potential penalties are determined at the jurisdictional level. Since many countries are converting the standards into law, non-compliance could lead to financial penalties and other legal consequences. The specific nature of these penalties would be defined by the regulatory bodies in each country.
Europe
Due Diligence
Summary: Mandates due diligence for large EU and non-EU companies operating in the EU. Companies are required to identify, prevent, mitigate, and account for negative human rights and environmental impacts in their operations and value chains. The directive includes whistleblower protections and provisions for civil liability.
Who is impacted?
The directive applies to EU and non-EU companies that meet specific thresholds. The scope has been narrowed from earlier proposals, but it still captures a broad range of large businesses.
EU Companies:
Group 1 (starting July 26, 2028): Companies with over 5,000 employees and a net worldwide turnover exceeding €1.5 billion.
Group 2 (starting July 26, 2029): Companies with over 3,000 employees and a net worldwide turnover exceeding €900 million.
Group 3 (starting July 26, 2030): Companies with over 1,000 employees and a net worldwide turnover exceeding €450 million.
Non-EU Companies: Companies with an EU-generated net turnover that exceeds the thresholds outlined for each group above.
Recent updates:
The directive officially entered into force on July 25, 2024. The legislative process was prolonged, leading to the "Stop-the-Clock" directive, which delayed the application dates for all three groups. Member states have until July 26, 2027, to transpose the directive into national law.
Enforcement and resources:
Enforcement is delegated to designated member state authorities, which will have powers to conduct investigations and impose penalties. The staggered application timeline provides a phased approach to compliance, starting with the largest companies. See the official EU Commission page for updates.
Impact and penalties:
Penalties will be determined by member states but must be effective, proportionate, and dissuasive. Administrative fines can be imposed, with a maximum of at least 5% of a company's net worldwide turnover. The directive also enables civil liability for damages resulting from non-compliance.
Summary: Requires companies to implement human rights and environmental due diligence systems. Non-compliance risks fines and exclusion from public tenders.
Who is impacted?
The act applies to companies that meet specific employee thresholds within Germany, regardless of their headquarters. The law has been in effect for companies with:
3,000+ employees since January 1, 2023
1,000+ employees since January 1, 2024
Industries with significant human rights and environmental risks, such as manufacturing, electronics, textiles, and raw materials, are particularly affected.
Recent updates:
The German government has begun a legislative process to amend the LkSG. On August 29, 2025, a draft bill was proposed to remove the annual reporting obligation and limit the scope of administrative fines to only serious human rights violations. These proposed changes are intended to streamline the act's requirements before the EU Corporate Sustainability Due Diligence Directive (CSDDD) is transposed into national law. While the due diligence obligations themselves remain, the Federal Office of Economics and Export Control (BAFA) is temporarily suspending its review of reports until the end of 2025.
Enforcement and resources:
Federal Office of Economics and Export Control (BAFA) oversees enforcement with powers to investigate, issue fines (up to €8 million or 2% of annual turnover), and exclude companies from public procurement. See the official BAFA site.
Impact and penalties:
Fines and public procurement exclusion for non-compliance.
Summary: Requires proof that certain goods imported into or exported from the EU are deforestation-free.
Who is impacted?
Operators and traders placing commodities on the EU market, such as cocoa, coffee, rubber, soy, palm oil, cattle, and wood products, and manufacturers using these raw materials.
Recent updates:
Due diligence obligations for large and medium operators began December 30, 2025. The EU adopted a country risk classification regulation affecting due diligence requirements on May 22, 2025.
Enforcement and resources:
Enforcement carried out by national authorities in member states. See the official European Commission site.
Impact and penalties:
Fines up to 4% of EU turnover, seizure/confiscation of goods, temporary bans from public contracts, and funding.
Environment and Climate Change
Summary: Expands mandatory sustainability reporting to a broad range of companies, requiring detailed disclosures on environmental, social, and governance (ESG) matters in accordance with European Sustainability Reporting Standards (ESRS). The CSRD aims to increase transparency and accountability by requiring sustainability information to be audited and published alongside financial reports.
Who is impacted?
The directive will eventually apply to approximately 50,000 companies. The scope includes:
Companies already subject to the NFRD: Public interest entities with over 500 employees.
Large EU companies: Companies meeting at least two of the following criteria: over 250 employees, a net turnover of over €50 million, or total assets of over €25 million.
Listed SMEs: Listed small and medium-sized enterprises (SMEs) with certain exemptions and reporting deferrals.
Non-EU Companies: Companies with an EU-generated net turnover exceeding €150 million and at least one large EU subsidiary or a branch with a net turnover exceeding €40 million.
Recent updates:
The implementation of the CSRD is being phased in with adjusted timelines.
Phase 1 (Reporting in 2025): Companies already subject to the NFRD began reporting on their 2024 financial year.
Phase 2 (Reporting in 2026): Large companies not previously subject to the NFRD will now begin reporting on their 2025 financial year, a two-year delay from the original timeline.
Phase 3 (Reporting in 2027): Listed SMEs will have a two-year deferral, with their first reports on the 2026 financial year now due in 2027.
Phase 4 (Reporting in 2029): Non-EU companies will begin reporting on their 2028 financial year.
Enforcement and resources:
Each member state is responsible for transposing the directive into national law and designating authorities to enforce compliance. Reports must be filed with business registries, ensuring they are publicly accessible. The ESRS, developed by EFRAG, provides the detailed framework for reporting. See official CDSB resources.
Impact and penalties:
The CSRD does not specify exact penalties for non-compliance; this is left to individual member states. However, the directive requires penalties to be "effective, proportionate, and dissuasive." Consequences can include substantial monetary fines (in some cases, up to 5% of a company’s worldwide turnover), public censure, and civil and criminal liability for executives.
Summary: Carbon pricing on imports for selected sectors to prevent carbon leakage.
Who is impacted?
Importers of covered goods like iron, steel, cement, aluminum, fertilizers, electricity, hydrogen.
Recent updates:
Definitive regime requiring purchase and surrender of CBAM certificates begins Jan. 1, 2026.
Enforcement and resources:
Enforced by national customs authorities requiring registration and emissions reporting.
Official Regulations: You can find the full legal texts of the CBAM Regulation and its implementing acts. This is the most authoritative source for the law itself.
Guidance and FAQs: The site offers various guidance documents, webinars, and frequently asked questions (FAQs) to help businesses understand their obligations during the transitional and definitive phases.
CBAM Transitional Registry: This is the official portal for importers to register and submit the required quarterly reports on embedded emissions.
Impact and penalties:
Non-compliance can result in fines, customs delays, import bans, and the seizure and forfeiture of goods.
Waste & Resource Management
Summary: Mandates resource efficiency, waste reduction, and recyclability.
Who is impacted?
EU member states, manufacturers, importers, and supply chains, particularly in construction, electronics, chemicals, packaging, textiles.
Recent updates:
Packaging and Packaging Waste Regulation (PPWR) entered into force on February 11, 2025, and will be applicable from August 12, 2026.
Enforcement and resources:
Enforced by environmental agencies of member states.
Impact and penalties:
Fines, product recalls, and market access restrictions imposed by member states.
Human and Labor Rights
Summary: Requires transparency to prevent slavery and trafficking via annual public statements.
Who is impacted?
UK commercial organizations with a total turnover of £36 million or more; sectors include fashion, manufacturing, agriculture, construction, and services.
Recent updates:
A 2024 House of Lords Committee report called for stronger enforcement, mandatory due diligence, and the introduction of an import ban on forced labor goods. These are recommendations for future legislation and not yet official policy.
Enforcement and resources:
UK government enforces via High Court injunctions, with potential reforms to enable fines and penalties.
Official Regulations: The full legal text of the Act.
Guidance for Businesses: Government guidance on how to comply with the reporting requirements.
Modern Slavery Statement Registry: The government-run registry where organizations can voluntarily publish their statements.
Impact and penalties:
No direct monetary fines yet, but legal injunctions, reputational damage, and contract losses risked.
Summary: Requires companies with large workforces to draft vigilance plans to manage human rights, health, and environmental risks in supply chains.
Who is impacted?
Companies with 5,000+ employees in France or 10,000+ employees in France and abroad; affected industries include retail, energy, manufacturing, agriculture, and services.
Recent updates:
Enforcement involves formal notice procedures permitting NGOs and civil society to require compliance.
Enforcement and resources:
Led by courts, with NGOs and individuals able to file lawsuits for non-compliance.
Official France Duty of Vigilance resources: Authoritative summary, legal actions, enforcement updates, English translations, and practical guides for companies and practitioners.
Official Regulations: Full legal text of the Act. Available here (French government).
NGO Resources: A list of companies and their vigilance plans is maintained by NGOs.
Government Guidance: Government guidance on compliance.
Impact and penalties:
Court orders, daily fines for ongoing non-compliance, and civil liability for harm caused by negligence.
North America
Human and Labor Rights
Summary: Prohibits import of goods made with forced labor in Xinjiang; mandates extensive supply chain due diligence.
Who is impacted?
U.S. importers of Xinjiang-origin goods, especially textiles, apparel, electronics, automotive parts, and solar components.
Recent updates:
Enforcement is active, with expanded Forced Labor Entity List and heightened scrutiny in high-priority sectors, including caustic soda, copper, lithium, jujubes (red dates), and steel, which were added in August 2025.
Enforcement and resources:
U.S. Customs and Border Protection (CBP) enforces rebuttable presumption prohibiting forced-labor goods.
"Forced Labor Enforcement Task Force Release of the 2025 Update to the UFLPA Strategy" (USTR, accessed Sept. 13, 2025)
"Uyghur Forced Labor Prevention Act Statistics" (U.S. Customs and Border Protection, accessed Sept. 13, 2025)
"Uyghur Forced Labor Prevention Act (UFLPA) Fact Sheet" (U.S. Department of State, accessed Sept. 13, 2025)
Impact and penalties:
Goods seizure, destruction, customs penalties, financial losses.
Summary: This Act aims to increase transparency and drive improvements in corporate supply chain practices. It requires entities to report on the measures they have taken to prevent and reduce the risk that forced labor or child labor is used in their supply chains.
Who is impacted?
The Act applies to any entity that has a place of business in Canada, does business in Canada, or has assets in Canada, and meets at least two of the following conditions in its most recent financial year:
At least $20 million in assets.
At least $40 million in revenue.
An average of at least 250 employees. It also applies to entities listed on a Canadian stock exchange. The reporting obligation is triggered for entities that produce or import goods, or control an entity that does so. New guidance has clarified that intangible assets (e.g., intellectual property and goodwill) are no longer included in the asset calculation.
Recent updates:
The second annual reporting cycle was due on May 31, 2025. Public Safety Canada issued updated guidance to clarify the definition of a reporting "entity" and provided more detail on how to assess risks and what information is required in a report. This new guidance helped to clarify ambiguities from the first reporting cycle.
Enforcement and resources:
The Act is managed by Public Safety Canada, which has an online portal for submissions. Reports must be publicly published in a prominent place on the entity's website. Public Safety Canada has the authority to conduct inspections and issue orders for corrective measures. While late submissions may be accepted and published, the Act makes late filing a strict liability offense.
Official Regulations & Act Text: The full legal text of the Act and its provisions.
Reporting Portal & Guidance: Official information and guidance for entities on how to prepare and submit a report.
Catalogue of Reports: A public catalogue of all submitted reports. Impact and penalties: Non-compliance can lead to significant penalties. Fines are up to CAD $250,000 for failure to file a report, providing false or misleading information, or failing to comply with an order. Importantly, directors and officers who knowingly authorize or permit non-compliance may be held personally liable.
Impact and penalties:
Non-compliance can lead to significant penalties. Fines are up to CAD $250,000 for failure to file a report, providing false or misleading information, or failing to comply with an order. Importantly, directors and officers who knowingly authorize or permit non-compliance may be held personally liable.
Environment and Climate Change
Summary: Proposed rules requiring climate-related financial disclosures for public companies.
Who is impacted?
Public companies with $700 million+ annual revenue, including energy, utilities, mining, chemicals, agriculture, manufacturing, transportation, financial services.
Recent updates:
Adopted March 2024 but stayed pending court review; the SEC announced March 27, 2025, that it would end its defense of the climate disclosure rule. The rules are now effectively terminated, though not formally repealed.
Enforcement and resources:
Await court outcomes and SEC actions.
Official Rulemaking Page: The SEC's press release and official information on the final rule.
SEC Statement on Ending Defense: A statement from an SEC Commissioner on the decision to withdraw the defense of the rules.
Analysis of Current Status: A legal analysis of the SEC's decision and its implications. Impact and penalties: Penalties depend on final court rulings.
Impact and penalties:
Penalties depend on final court rulings.
Summary: These laws mandate a new level of corporate climate accountability for companies operating in California. SB 253 (the Climate Corporate Data Accountability Act) requires public disclosure of a company’s full greenhouse gas (GHG) emissions. SB 261 (the Climate-Related Financial Risk Act) requires companies to report on their climate-related financial risks and mitigation strategies.
Who is impacted?
The laws apply to U.S.-based public and private companies that "do business in California" and meet the following revenue thresholds:
SB 253: Companies with annual revenues exceeding $1 billion.
SB 261: Companies with annual revenues exceeding $500 million.
Recent updates:
The laws are in effect, and compliance deadlines remain despite ongoing legal challenges.
The California Air Resources Board (CARB) has not yet finalized all implementing regulations but is moving forward with the process. They held a public workshop in August 2025 and are expected to propose a final rule for the Board's consideration in December 2025.
A federal court denied a preliminary injunction in August 2025, allowing the laws to proceed while a First Amendment challenge continues. A hearing on a request for an injunction to block the laws during an appeal to the Ninth Circuit Court is scheduled for September 15, 2025.
The first SB 261 reports are due by January 1, 2026.
The first SB 253 reports (for Scope 1 and 2 emissions from the 2025 fiscal year) are due in 2026 by a date to be determined by CARB (a proposed deadline is June 30, 2026). Scope 3 emissions reporting will begin in 2027.
Enforcement and resources:
Enforcement is the responsibility of the California Air Resources Board (CARB). CARB will manage a public docket for reports and is planning to publish a list of companies it believes are subject to the laws in September 2025.
Official Bill Text for SB 253 & SB 261: The full text of both laws can be found on this page.
CARB's FAQ on Climate Disclosure Laws: A document from CARB providing initial guidance for companies.
Litigation Update from Law Firms: A summary of the legal challenges and their status.
Impact and penalties:
Companies face significant penalties for non-compliance.
SB 253: Penalties for non-compliance can be up to $500,000 per reporting year. CARB has indicated it will exercise enforcement discretion during the first reporting cycle for companies that can demonstrate a good-faith effort to comply.
SB 261: Penalties for non-compliance can be up to $50,000 per reporting year.
South America
Environment and Climate Change
Summary: Governs forest protection, licensing, and deforestation limits. The Code requires private landowners to maintain areas of native vegetation as Permanent Preservation Areas (APPs) and Legal Reserves (RLs).
Who is impacted?
Landowners and agricultural producers, especially in the soy, cattle, and timber sectors.
Recent updates:
Enforcement has been strengthened under the current administration, with IBAMA issuing an increasing number of fines and seizing illegal agricultural goods and machinery. Recent reports from August 2025 show deforestation alerts have risen in the Amazon biome over the past year.
Enforcement and resources:
The law is enforced by the Brazilian Institute of Environment and Renewable Natural Resources (IBAMA) and state environmental agencies. Enforcement is carried out through fines, embargoes, and a public registry of non-compliant properties.
Official Legal Text: The full legal text of the Act.
IBAMA Official Site: The website for the federal enforcement agency.
Rural Environmental Registry (CAR): A mandatory national registry for all rural properties, which is the primary tool for monitoring compliance. Impact and penalties: Penalties for non-compliance include fines, land embargoes, and the loss of access to subsidized rural credit. Penalties can also include criminal prosecution and the seizure of illegally produced goods.
Impact and penalties:
Fines, embargoes, rural credit access loss.
Summary: Establishes a legally binding goal of achieving carbon neutrality by 2050 and sets national emissions reduction targets and sustainability reporting rules.
Who is impacted?
Large Chilean companies, government agencies; sectors with significant emissions like mining, energy, transportation, and agriculture.
Recent updates:
The law, enacted in 2022, is in the implementation phase. Sectoral mitigation and adaptation plans are currently being drafted, with final versions expected to be published over the next several years.
Enforcement and resources:
The Ministry of the Environment (MMA) and various sectoral agencies share oversight. The law empowers these agencies to set specific emissions limits by sector.
Official Legal Text: The full legal text of the Act.
IBAMA Official Site: The website for the federal enforcement agency.
Rural Environmental Registry (CAR): A mandatory national registry for all rural properties, which is the primary tool for monitoring compliance.
Impact and penalties:
Penalties for non-compliance include fines, land embargoes, and the loss of access to subsidized rural credit. Penalties can also include criminal prosecution and the seizure of illegally produced goods.
Due Diligence
Summary: This legal framework requires environmental due diligence, pollution control, and sustainability reporting for projects that impact the environment. The foundation is Law 99 of 1993, which created the institutional framework for environmental management.
Who is impacted?
Colombian companies and foreign investors are subject to these regulations, particularly those in natural resource projects such as mining, oil and gas, infrastructure, and renewable energy.
Recent updates:
A major recent update is the constitutionalization of the Escazú Agreement in 2024, which strengthens public participation and access to environmental justice. Additionally, the government has proposed eliminating environmental licenses for certain smaller renewable energy projects to streamline development.
Enforcement and resources:
ANLA Official Site: The official website for the National Environmental Licensing Authority.
Ministry of Environment: The website for Colombia's Ministry of Environment and Sustainable Development.
Law 99 of 1993: The legal text of the foundational environmental law.
Impact and penalties:
Penalties for non-compliance are severe and are governed by Law 1333 of 2009. They can include significant fines of up to 100,000 minimum monthly wages, temporary or permanent suspension of activities, confiscation of assets, and the revocation of licenses and permits.
Africa
Environment and Climate Change
Summary: Imposes a tax on carbon dioxide equivalent greenhouse gas emissions and gives effect to the "polluter-pays" principle.
Who is impacted?
Large industrial, energy, and transport emitters, including power generation, manufacturing, mining, and fuel production.
Recent updates:
The current tax rate is R236 per tonne of CO2e as of January 1, 2025. Phase 1 of the tax has been extended and will run until December 31, 2025, with Phase 2 set to begin on January 1, 2026.
Enforcement and resources:
The Act is administered and enforced by the South African Revenue Service (SARS) in collaboration with the Department of Forestry, Fisheries and the Environment (DFFE) and the National Treasury.
Official Legal Text: The full legal text of the Act.
Official SARS Website: The website for the South African Revenue Service, the primary administrative body.
DFFE Official Site: The website for the Department of Forestry, Fisheries and the Environment, which assists with enforcement and reporting.
Impact and penalties:
Non-compliance can lead to financial penalties for late or incorrect reporting and tax payment. New draft legislation proposes more severe penalties, including fines of up to R10 million and potential imprisonment for executives who fail to submit required reports or provide false information.
Summary: Provides the legal framework for a low-carbon, climate-resilient development pathway in Kenya. The Act requires public and private entities to incorporate climate mitigation and adaptation measures into their operations.
Who is impacted?
All sectors of the economy, including agriculture, energy, manufacturing, transport, and county governments. The law also impacts entities engaging in carbon market projects.
Recent updates:
The Climate Change Act was amended in 2023 to provide a legal framework for carbon markets. The Climate Change (Carbon Markets) Regulations, 2024 were published in June 2024 to regulate the operation of carbon projects, establish a National Carbon Registry, and enforce compliance. Enforcement and resources: The National Climate Change Council provides policy direction, while the National Environment Management Authority (NEMA) monitors, investigates, and reports on compliance.
Enforcement and resources:
The National Climate Change Council provides policy direction, while the National Environment Management Authority (NEMA) monitors, investigates, and reports on compliance.
Official Legal Text: The official government text of the Act.
NEMA Official Site: The website for the National Environment Management Authority, the primary enforcement body.
Carbon Markets Regulations (2024) Summary: A summary and analysis of the new regulations governing carbon markets.
Impact and penalties:
The Act and its regulations impose fines and other penalties for non-compliance. These can be severe, including fines of up to KES 500 million (approximately USD 3 million) or imprisonment for up to 10 years for offenses related to carbon markets.
Summary: Mandates Environmental Impact Assessments (EIAs) for public and private projects that are likely to have a significant environmental effect.
Who is impacted?
Industrial developers, contractors, and suppliers in sectors such as oil and gas, mining, infrastructure, and manufacturing.
Recent updates:
While the Act itself has not been updated since its amendment in 2004, enforcement efforts have become more targeted. The government is also engaging stakeholders in a review process to update the outdated law, which lacks provisions for new challenges like climate change.
Enforcement and resources:
The primary enforcing bodies are the Federal Ministry of Environment and the National Environmental Standards and Regulations Enforcement Agency (NESREA). Enforcement is carried out through monitoring, audits, and compliance orders.
Official Legal Text: The full legal text of the Act.
NESREA Official Site: The website for the National Environmental Standards and Regulations Enforcement Agency.
Federal Ministry of Environment: The website for the Federal Ministry of Environment.
Impact and penalties:
Penalties for non-compliance are governed by the Act and other environmental laws. They can include fines of up to ₦1,000,000 for corporations and imprisonment for up to 5 years for individuals who violate the Act's provisions. Projects can also be suspended or shut down.
Asia-Pacific and Middle East
Due Diligence
Summary: Mandated by the Securities and Exchange Board of India (SEBI), the BRSR is a reporting framework that requires ESG disclosures for the largest publicly listed Indian companies, aligned with international standards.
Who is impacted?
The top 1,000 publicly listed Indian companies by market capitalization are required to file the BRSR. The framework has also introduced a phased approach for disclosures from key value chain partners.
Recent updates:
In March 2025, SEBI introduced key amendments to the BRSR framework, including:
A new BRSR Core framework that specifies a subset of 49 key performance indicators (KPIs) for which mandatory, third-party assurance is required.
The introduction of Green Credits as a new leadership indicator under Principle 6 of the BRSR.
A phased implementation of mandatory assurance on the BRSR Core, beginning with the top 150 companies for FY 2023-24 and expanding to the top 1,000 by FY 2026-27.
Enforcement and resources:
The BRSR is managed and enforced by the Securities and Exchange Board of India (SEBI).
Official SEBI Circular (March 2025): The legal document detailing the latest amendments.
Official SEBI Website: The website for the Securities and Exchange Board of India.
BSE BRSR Filing Example (2025): A sample BRSR filing for the financial year 2024-25.
Impact and penalties:
While there are currently no direct financial penalties for BRSR non-compliance, SEBI has the power to issue fines and take other regulatory action for violations of the Listing Obligations and Disclosure Requirements (LODR). The primary impacts of non-compliance are reputational damage, increased regulatory scrutiny, and a potential loss of investor confidence.
Environment and Climate Change
Summary: This law requires all public and private entities in the UAE to measure, report, and plan for the reduction of their greenhouse gas (GHG) emissions. It provides a legal framework for the country's national climate strategy.
Who is impacted?
The law applies to all entities in the UAE, including those in free zones. While all entities must report, those with annual emissions of 500,000 metric tons of CO2e or more have additional mandatory requirements, such as registering with the National Carbon Registry and obtaining third-party verification.
Recent updates:
The law was issued in August 2024 and came into force on May 30, 2025. All entities have until May 30, 2026, to ensure full compliance with its provisions. The law also establishes a National Carbon Credit Registry and provides a framework for carbon markets.
Enforcement and resources:
The law is enforced by the Ministry of Climate Change and Environment (MOCCAE), which will set annual GHG reduction targets for various sectors and establish a central electronic platform for reporting.
Official Legal Text: The full legal text of the law.
MOCCAE Official Site: The official website of the Ministry of Climate Change and Environment.
UAE Climate Change Law Guide: A comprehensive guide on the law's implications.
Impact and penalties:
The law imposes significant financial penalties for non-compliance. Fines for failing to measure, maintain records, or report GHG emissions range from AED 50,000 to AED 2 million. Penalties for repeat offenses can be doubled.
Summary: The United Arab Emirates has implemented a phased nationwide ban on single-use plastic products as a key initiative to combat plastic pollution and align with its Net Zero by 2050 goals. The ban applies to a wide range of plastic items and is being introduced through a progressive schedule of regulations. The official regulation that outlines this process is Cabinet Resolution No. 38 of 2024, which builds on earlier federal laws.
Who is impacted?
All businesses and entities operating in the UAE, including the retail, hospitality, and manufacturing sectors. The ban is also intended to influence consumer behavior by encouraging the use of reusable and sustainable alternatives.
Status and Key Dates: The ban is being implemented in phases and varies slightly across different emirates.
January 1, 2024: The import, production, and trade of single-use plastic bags were banned.
January 1, 2025: The ban was expanded to include a wider range of single-use plastic items, such as stirrers, straws, cotton swabs with plastic stems, and Styrofoam cups and food containers.
January 1, 2026: A comprehensive ban will be enforced on a wider range of single-use plastic products, including cups, lids, cutlery, food containers, and plates.
Recent updates:
January 1, 2026: A comprehensive ban will be enforced on a wider range of single-use plastic products, including cups, lids, cutlery, food containers, and plates.
Enforcement and resources:
Enforcement is led by the Ministry of Climate Change and Environment (MOCCAE) in coordination with local government entities in each emirate, such as the Dubai Municipality.
Official UAE Ministry of Climate Change and Environment Page: The primary government source for official decrees and national strategies.
Legal Insight on Phased Ban (Baker McKenzie): A comprehensive legal overview of the ban's scope and key dates.
Dubai Municipality Details: Provides a breakdown of the specific items banned in Dubai and the phased rollout.
Impact and penalties:
Noncompliance can lead to fines, which for first-time violations start at AED 200 and double for repeat offenses up to a maximum of AED 2,000. Businesses will need to audit their current materials and source certified compostable or reusable alternatives to comply with the regulations.
Human and Labor Rights
Summary: The Japanese government's guidelines for human rights due diligence, while not a binding law, are seen as a strong signal and have become the de facto standard for corporate behavior in Japan. They provide a clear framework for companies to identify, prevent, and mitigate human rights risks across their value chains, mirroring international standards such as the UN Guiding Principles on Business and Human Rights.
Who is impacted?
All companies operating in Japan, particularly those with global supply chains.
Investors and stakeholders who expect companies to demonstrate responsible business practices.
Recent updates:
September 2022: The guidelines were released by the Ministry of Economy, Trade and Industry (METI) and the Ministry of Foreign Affairs (MOFA).
Ongoing: The guidelines are currently in effect as voluntary guidelines, but their adoption has been widespread among major Japanese companies. The government is monitoring their implementation and actively promoting their use.
Enforcement and resources:
The guidelines are not legally binding. However, the government has begun integrating human rights due diligence as a consideration in public procurement tenders, which provides an incentive for compliance.
Official Guidelines Document (English): This is the main document outlining the framework for human rights due diligence.
Ministry of Foreign Affairs' Business and Human Rights page: Provides an overview of Japan's stance and activities regarding business and human rights.
Impact and penalties:
There are no direct legal penalties for noncompliance. However, companies may face significant reputational risk and increasing pressure from investors, consumers, and civil society, particularly given the trend toward mandatory human rights legislation in other jurisdictions.
This guide was compiled using publicly available information and research from the following sources, current as of 2025.
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