ESG

It’s no secret that banks are under increasing pressure to understand and manage their environmental, social, and governance (ESG) risks, and Banca d’Italia’s latest report on ESG disclosures shows just how challenging that can be. As the financial world moves toward a more sustainable future, Italian and European banks are slowly but surely stepping up to the plate—despite facing significant hurdles. Banca d’Italia’s Notes on Financial Stability and Supervision No. 45 delves into the current state of ESG risk assessment, tracking the progress these banks have made while highlighting the areas still in need of improvement.

In what is sure to be a controversial turn of events, the U.S. Securities and Exchange Commission (SEC) has decided to pull back from its defense of the much-debated climate disclosure rules. A move that may change the course of corporate environmental regulation, the SEC’s vote today marks a shift in its approach to climate-related corporate transparency.

If you’ve been keeping an eye on the news, it might feel like corporate sustainability is in trouble. Stories about companies walking back their climate commitments seem to be everywhere—fueled by a mix of economic strain, shifting regulations, and political uncertainty. It’s easy to get the impression that businesses are losing their nerve when it comes to climate action.

Today, the European Banking Authority (EBA) took a step forward in tracking climate-related risks within the EU banking sector. With the release of its new climate risk monitoring dashboard, the EBA is shedding light on just how exposed European banks are to the changing climate landscape—and how well prepared they are to manage the financial implications.

When the European Commission unveiled its Omnibus proposal, it sparked a shift in the scope and timing of the Corporate Sustainability Reporting Directive (CSRD)—and with it, some new challenges and opportunities for businesses and auditors alike. The proposal trims the number of companies that must comply with CSRD standards, but despite these changes, the Dutch Authority for the Financial Markets (AFM) is doubling down on its commitment to keeping sustainability reporting both transparent and reliable. The question remains over whether the tweaks in the Omnibus proposal truly improve things, or is it more of a stopgap?

Senator Bill Hagerty (R-TN), a member of the Senate Banking Committee, has introduced the Prevent Regulatory Overreach from Turning Essential Companies into Targets (PROTECT USA) Act of 2025. The bill is intended to protect U.S. businesses from the extraterritorial reach of European Union regulations, specifically the Corporate Sustainability Due Diligence Directive (CSDDD), which was adopted in May 2024.

The Sustainability Standards Board of Japan (SSBJ) has recently unveiled its sustainability disclosure standards. This marks a milestone not just for Japan, but for the global conversation around transparency in corporate sustainability. The SSBJ, which was established in July 2022 with a mission to develop standards that would align with the global push for clearer, more comparable sustainability disclosures, has now taken a major step forward.