What's Happening in Sustainability & ESG (Week Recap 11.02 - 17.02) 🌎

This week’s read time: 8 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. 🍀

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In this edition, we’ll cover:

• Despite the SEC rule pause, market forces see climate risk as a critical financial issue 🇺🇸

• Most companies remain committed to sustainability and climate reporting - Workiva survey 📑 

• US corporate boards see significant risks in speaking out on social issues amid heightened political scrutiny 🇺🇸

• Disney, Goldman Sachs, and ISS are among the latest companies retreating from DEI commitments ⏪

• and other news 🌍

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THIS WEEK’S TOP NEWS

Regulatory Oversight & Industry Insights

🇺🇸 The US Securities and Exchange Commission (SEC) effectively paused its climate disclosure rule, with Acting Chair Mark Uyeda calling it “deeply flawed” and harmful to the economy. The rule, which initially required public companies to disclose Scope 1, 2, and 3 emissions, was already weakened before facing legal challenges from business groups and Republican state attorneys general. Uyeda has now directed SEC lawyers to halt its legal defense, signaling its likely demise. However, while federal climate disclosure rules are fading, states like California and New York are stepping in with strict reporting mandates that will require businesses, including private companies, to disclose emissions and climate risks. At the same time, the EPA, under Administrator Lee Zeldin, is moving to terminate $20 billion in Biden-era climate grants aimed at clean energy and transportation projects in disadvantaged communities, part of a broader Trump administration effort to freeze climate-related funding despite ongoing legal battles.

Beyond politics: Market forces see climate risk as a critical financial issue

Institutional investors managing $1.5 trillion (including Scottish Widows, the People’s Partnership, and Brunel Pension Partnership) warned asset managers to intensify climate action or risk losing their mandates, emphasizing the long-term financial risks of climate inaction. As some major asset managers back away from climate commitments due to political pressure, these investors are demanding proactive engagement with portfolio companies and stricter voting on climate issues. Meanwhile, JPMorgan Chase launched “Climate Intuition,” a report led by the bank’s global head of climate advisory and former NOAA chief scientist, Sarah Kapnick, in response to growing client demand for climate-related insights. The report emphasizes that companies integrating climate awareness into their strategies will have a competitive edge, highlighting the increasing economic risks tied to extreme weather and global warming. Kapnick stresses the need for newer climate data as extreme temperatures rise faster than average temperatures, impacting businesses, infrastructure, and national security. JPMorgan’s own climate stance remains inconsistent—in January, it exited the Net-Zero Banking Alliance and it also remains the largest fossil fuel financier.

MORE INTERESTING NEWS

Latest developments, reports, insights, and trends

📊 Despite regulatory uncertainty, most companies remain committed to sustainability and climate reporting, recognizing its strategic value, according to a new Workiva survey of over 1,600 executives and 222 institutional investors. The report found that 85% of executives plan to continue disclosing GHG emissions, regardless of political changes, and 97% believe integrated sustainability and financial reporting provides a competitive advantage. Investor interest is also rising, with 96% agreeing that sustainability data improves financial decision-making and 97% more likely to invest in companies with assured reporting. However, challenges remain, as 29% of executives lack full confidence in their sustainability data accuracy, and 73% say their reporting technology is insufficient for compliance with new regulations.

📑 Another survey by Datamaran, ‘2025 CSRD Pulse Check’, shows that 71.6% of companies conduct regular ESG strategy reviews at the board level, 62.6% have dedicated ESG committees, and 32.87% link executive performance to ESG metrics, signaling sustainability’s move from an isolated function to a boardroom priority. Beyond compliance, 80.6% of companies use CSRD data to improve sustainability disclosures, 56.7% apply insights to risk management and strategic planning, and 44.7% use it for competitive benchmarking, though only 23.8% integrate supplier and partner evaluations. The top insights for decision-making include material impacts, risks, and opportunities (55%), strategic ESG-business alignment (37.8%), and value chain data analysis (30.7%).

🇺🇸 US corporate boards see significant risks in speaking out on social issues amid heightened political scrutiny, with only 18% of directors believing executives should publicly reinforce company values, according to a new survey by Corporate Board Member, Diligent, and FTI Consulting. The report highlights a shift toward less vocal leadership, with 85% of directors fearing customer loss from taking a stance, while only 15% see greater risk in remaining silent. Most companies have policies restricting public statements, with 81% implementing guidelines on who can speak on their behalf.

📚 The Taskforce on Nature-related Financial Disclosures (TNFD) launched two new capacity-building tools: the Learning Lab for self-guided training and the Trainer Portal for corporate and third-party educators. These platforms aim to help businesses and financial professionals integrate nature-related issues into decision-making by providing structured learning materials. Developed with the Cambridge Institute for Sustainability Leadership (CISL), the Trainer Portal includes presentation decks, teaching guides, and exercises. TNFD is collaborating with stock exchanges, financial institutions, and sustainability leaders to accelerate adoption, with over 1,700 member organizations and 300,000 downloads of its guidance documents in the past year.

📑 The Science Based Targets initiative (SBTi) updated its timeline for developing its new Corporate Net-Zero Standard, delaying public consultation until at least March 2025. Originally launched in 2021 to certify corporate decarbonization commitments, the standard’s revision process has been met with controversy, particularly regarding a proposal to allow carbon credits for Scope 3 emissions, which sparked internal backlash and leadership changes. The newly appointed CEO, David Kennedy, may reconsider this approach. SBTi will now consult Expert Working Groups on key topics, including Scope 2 and Scope 3 target setting, carbon credits, and Carbon Dioxide Removal (CDR). The revised process includes multiple public consultations to refine the standard while ensuring alignment with the initial version to facilitate corporate commitments.

WHAT ARE COMPANIES DOING?

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

⏪ Disney, Goldman Sachs, and ISS are among the latest companies retreating from DEI commitments amid rising political scrutiny. Goldman Sachs scrapped its board diversity policy, which required at least two diverse board members for IPOs, citing legal challenges and Trump-era regulatory shifts. The reversal aligns with a broader corporate pullback from DEI following Trump’s executive orders and a court ruling overturning Nasdaq’s diversity requirement. Meanwhile, Disney is also changing its DEI programs to focus more closely on business outcomes, shifting focus to talent attraction and workplace culture while removing diversity-focused executive compensation metrics. Conservatives, including Trump ally Stephen Miller, have criticized Disney’s DEI efforts, and the company previously clashed with Florida Governor Ron DeSantis over LGBTQ+ policies. Additionally, proxy advisory firm ISS will no longer consider gender and racial diversity in board voting recommendations, citing political pressure from 21 state Attorneys General. The firm acknowledged that companies and investors will take different approaches to adapting their DEI policies.

🟢 Air Liquide and TotalEnergies announced a joint investment of over €1 billion to develop two large-scale low-carbon hydrogen production plants in the Netherlands. The projects include a 200 MW electrolyzer in Rotterdam, powered by TotalEnergies’ offshore wind farms and set to begin operations by late 2027, and a 250 MW electrolyzer in Zeeland, developed through an equally held joint venture. The projects aim to reduce CO₂ emissions from TotalEnergies’ refineries in Belgium and the Netherlands by up to 450,000 metric tons annually, supporting decarbonization in heavy industry and mobility sectors.

EVERYTHING FINANCE

Sustainable finance, funding rounds, acquisitions & private equity deals

🔌 HSBC Asset Management (HSBC AM) invested in Singapore-based EV charging company SP Mobility, marking a strategic partnership to expand EV charging solutions in the region. SP Mobility operates Singapore’s largest public EV charging network with over 1,900 charging points, supporting the country’s rapidly growing EV adoption, where over a third of new car registrations in 2024 were electric. HSBC AM aims to leverage its infrastructure expertise to drive SP Mobility’s growth and explore inorganic expansion opportunities.

⚡️ Energy management platform Arcadia acquired RPD Energy to enhance its renewable energy procurement solutions for businesses and enterprises. Arcadia, which provides energy data management and community solar access, will integrate RPD Energy’s expertise in sourcing and delivering renewable power to corporate customers. The acquisition expands Arcadia’s Energy Procurement Advisory service, helping businesses optimize renewable power purchasing, behind-the-meter solar and storage solutions, and RECs and offsets.

🟢 UK-based climate solutions platform Ecologi acquired carbon measurement and reduction platform Net Zero Now to create a comprehensive solution for businesses aiming for net zero. The deal combines Net Zero Now’s sector-specific carbon measurement tools with Ecologi’s climate project funding, enabling businesses to calculate, reduce, and offset emissions while streamlining compliance with regulations like SECR, CSRD, and SBTi.

Funding rounds:

⚡️ Hydrostor, a long-duration energy storage provider, secured $200 million in financing to advance its Advanced Compressed Air Energy Storage (A-CAES) projects, supporting renewable energy integration. A-CAES technology enables scalable, long-duration energy storage (8 hours to multi-day) using underground air compression and thermal storage, addressing renewable energy intermittency.

🌳 Nature-based carbon removal startup Chestnut Carbon raised $160 million in a Series B round to scale its forest restoration projects, aiming to sequester 100 million tons of carbon. Founded in 2022 by alternative asset manager Kimmeridge, Chestnut acquires marginal farmland in the US and partners with local foresters to develop biodiverse ecosystems that generate high-integrity carbon credits.

🟢 StormFisher Hydrogen secured a $50 million investment to accelerate its pipeline of clean fuel production projects across the US and Canada. The Houston-based company develops e-Fuels using renewable energy-powered electrolysis, producing green hydrogen, e-Methanol, green ammonia, and e-Methane to help decarbonize hard-to-abate industries such as transportation, heavy industry, and gas utilities.

🔋 Battery tech startup ACCURE Battery Intelligence raised $16 million in a Series B funding round to scale its AI-driven predictive analytics software, which enhances battery safety, reliability, and sustainability. Founded in 2020, Germany-based ACCURE provides a platform that monitors batteries, detects issues, prevents thermal runaway events, and optimizes performance, helping operators reduce downtime and maintain warranty coverage.

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