What's Happening in Sustainability & ESG (01.01 - 06.01) 🌎

🎉 Happy New Year, and thanks for being part of our community.

The past year tested sustainability from every angle, but it also clarified what truly matters. Thank you for reading, sharing, and trusting Green Digest along the way.

In the year ahead, we’ll continue to follow the developments that shape sustainability in practice, from policy shifts and market signals to how companies are actually responding.

As always, if you have suggestions on how we can improve or topics you’d like us to cover, just reply to this email. We read every note.

- Ardit from GD

This week’s read time: 6 minutes

Welcome to this edition of Green Digest, where you will get updated about everything happening in the Sustainability & ESG space in less than 10 minutes. 🌎

We go through tons of articles and data from the most reliable sources, filter & simplify them, and serve them to you in bite-sized chunks every week. 🍀

In this edition, we’ll cover:

• The year ahead in sustainability: What actually matters 💭

• Three offshore wind developers sue Trump administration over $25 billion East Coast project halt 🇺🇸

• China released a new climate disclosure standard aligned with the IFRS ISSB framework 🇨🇳

• Venture capital is likely to continue pivoting away from climate tech in 2026 📉

• Tesla lost its top EV seller spot in 2025 as deliveries fell 9% to 1.64 million, overtaken by China’s BYD with 2.26 million sales 🚗

• and other news 🌍

THIS WEEK’S TOP NEWS

Regulatory Oversight & Industry Insights

2025 was one of the toughest years the sustainability profession has faced, marked by political reversals, regulatory rollbacks, legal pressure on climate claims, stalled clean energy momentum, and the loss of thousands of public-sector climate experts. From the weakening of the US Inflation Reduction Act and uncertainty around SEC climate disclosures, to the dilution of EU sustainability rules, the collapse of plastics treaty talks, and abrupt attacks on offshore wind and renewable institutions, many of the structures that supported corporate climate action were undermined at once.

These setbacks have pushed sustainability out of performative commitments and into more grounded, resilient forms of action, where leadership is driven by choice rather than compliance. As regulation weakens or stalls, responsibility is shifting decisively to companies willing to integrate climate and environmental goals into core business decisions, operations, and risk management.

Sustainability in 2026 will be defined less by bold declarations and more by quiet, disciplined execution that delivers measurable business value. As budgets tighten, teams shrink, and scrutiny intensifies, the companies staying the course are steadily building durable systems and embedding sustainability into how the business actually runs.

A clear pattern has emerged across industries: effective sustainability leaders focus on what they can control, build internal trust, and stay aligned with core business priorities, even when sustainability is not the loudest voice in the room. Their influence increasingly comes from credibility, relationships, and clarity rather than formal mandates. Leadership in 2026 looks less like grand vision-setting and more like steady competence under pressure.

At the same time, sustainability is moving decisively from standalone strategies into core business systems. Climate goals are shaping budgets, procurement decisions, risk management, and board oversight. Decarbonization and circularity are transitioning from pilots into day-to-day operations.

Digital infrastructure, from data centers to AI deployment, is now assessed through the lens of energy use, embodied emissions, water, and long-term capacity planning. These are no longer side initiatives but operational realities.

Credibility is also being rebuilt through data, technology, and greater precision in communication. Companies are investing in better supplier data, stronger lifecycle assessment frameworks, and practical digital tools that reduce manual work and improve decision-making. Grand narratives are giving way to grounded stories focused on outcomes, tradeoffs, and business relevance.

In a more constrained and politicized environment, this shift toward substance over spectacle may be the most important sustainability signal of all.

The loss of public-sector capacity is creating new momentum in the private sector, as experienced climate experts move into companies, advisory roles, and startups, bringing deeper technical rigor and execution focus. At the same time, tighter scrutiny of climate claims is forcing clearer language, better data, and more credible strategies.

Taken together, these shifts point to a more pragmatic, innovation-driven sustainability landscape in 2026, defined less by headlines and more by durable systems, internal capability, and leaders who continue to act with steady, actionable hope.

MORE INTERESTING NEWS

Latest developments, reports, insights, and trends

🇺🇸 Three offshore wind developers are suing the Trump administration after the Interior Department ordered a halt to five East Coast offshore wind projects worth around $25 billion, citing “national security concerns.” Ørsted, Equinor, and Dominion Energy say the pause affects nearly completed projects totaling around 6 GW of capacity, and is already causing significant financial losses.

Ørsted said its 704 MW offshore wind project off Rhode Island is 87% complete, with about $5 billion already spent or committed, all permits secured after extensive federal and defense reviews, and power generation expected to begin in January 2026 for more than 350,000 homes in Connecticut and Rhode Island. Equinor said its Empire Wind project, developed under contract with New York State, is more than 60% complete and that halting work risks serious commercial and financing damage at a critical stage. Dominion Energy said it already invested $8.9 billion in its Coastal Virginia project, which was expected to start generating power in early 2026, and warned the pause could harm customers and regional energy supply, with a court hearing scheduled for January 16.

🇨🇳 China released a new climate disclosure standard aligned with the IFRS ISSB framework, initially voluntary but designed to become mandatory over time, to help companies report climate risks, opportunities, and impacts and support green development goals. The standard mirrors IFRS S2’s core structure but adds China-specific elements, notably mandatory reporting on companies’ climate impacts across value chains, with sector-specific guidelines planned and a phased expansion from large listed firms to SMEs and from qualitative to quantitative disclosures.

WHAT ARE COMPANIES DOING?

Corporate sustainability, new tools and services & companies in the news

🚗 Tesla lost its position as the world’s top electric vehicle seller in 2025 after deliveries fell 9% to 1.64 million vehicles, overtaken by China’s BYD with 2.26 million sales. The decline was driven by backlash against Elon Musk’s politics, the expiration of US EV tax credits, and stronger competition overseas, marking Tesla’s second consecutive year of falling sales. Despite weaker vehicle performance and regulatory scrutiny, investors remain focused on Tesla’s push into robotaxis, energy storage, and robotics, helping the stock finish the year up about 11%.

⚡️ Octopus Energy Group said it will spin out its AI-powered utility software business Kraken, and raise $1 billion in a standalone funding round valuing the company at more than $8.6 billion. Kraken provides an AI operating system for energy utilities, including virtual power plant capabilities, and now serves over 70 million utility accounts globally, with contracted annual revenues exceeding $500 million after more than quadrupling in three years. The de-merger will allow Kraken to scale as an independent, neutral platform while Octopus focuses on its core energy businesses, retaining a 13.7% stake.

⚡️ Italian energy company Eni said it is spinning out its traditional refining and logistics assets into a new company, Eni Industrial Evolution S.p.A., as part of its strategy to decarbonize its energy offering and accelerate industrial transformation. The move transfers several European refineries, logistics infrastructure, and downstream investments into the new unit to support circular economy and new supply chains, while Eni retains its biorefineries.

EVERYTHING FINANCE

Sustainable finance, funding rounds, acquisitions & private equity deals

📉 Venture capital is likely to continue pivoting away from climate tech in 2026 as weaker policy support, regulatory uncertainty, AI-driven energy demand, and lower risk appetite reshape investor priorities. Fundraising for impact funds fell from $156.9 billion in 2022 to $71.4 billion in 2024 and just $36.7 billion in the first nine months of 2025, pushing investors toward defense, energy security, adaptation, and transition technologies rather than pure climate mitigation plays. While some VCs see opportunities in geothermal, nuclear, carbon capture, and resilience-focused solutions, others expect green premiums, green hydrogen, and green steel to struggle, with capital increasingly flowing only to businesses that can scale without heavy government support.

Acquisitions

⚡️ Alphabet acquired clean energy developer Intersect for $4.75 billion to secure large-scale power for its rapidly expanding AI and data center operations. The deal brings Alphabet access to Intersect’s clean energy and data center projects, with more than $15 billion in assets and up to 10.8 GW expected by 2028.

⚡️ Glencore acquired a majority stake in the Dutch energy solutions provider, FincoEnergies. Founded in 2013, FincoEnergies supplies fuels, biofuels, carbon offsetting credits, and emissions reduction solutions for transportation and industry.

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