What's Happening in Sustainability & ESG (Week Recap 29.07 - 04.08) 🌎

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. 🍀

In this edition, we’ll cover:

• Mixed signals for ESG in the US: a snapshot of the latest developments 🇺🇸

• EFRAG released revised ESRS drafts and adopted a Voluntary SME Standard 🇪🇺

• Over 300 investors, companies, and organizations (including Allianz and IKEA) are urging EU policymakers to safeguard the double materiality principle at the heart of the CSRD 🇪🇺

• Barclays announced its exit from the UN-backed Net-Zero Banking Alliance (NZBA) 🏦

• and other news 🌍

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THIS WEEK’S TOP NEWS

Regulatory Oversight & Industry Insights

🇺🇸 It was an eventful week in the US, so we’ve prepared a snapshot of the latest developments:

US companies blocked a record number of shareholder resolutions in 2025 after SEC guidance made it easier to exclude climate, labor, and diversity proposals. The SEC granted 195 “no-action” requests, up 33% from last year, leading to fewer votes on environmental and social issues like Amazon’s labor rights or Constellation Brands’ climate targets. The new guidance, which reverses Biden-era policies, allowed companies to argue such proposals were immaterial or micromanaging. As a result, ESG-related submissions dropped, and 21% were omitted — more than double last year’s rate. Both ESG advocates and skeptics saw proposals rejected, prompting groups to rethink their 2026 strategies.

Governance Proposals Gain Ground Either Way

Despite waning support for environmental and social proposals, corporate governance reforms continue gaining traction among US shareholders. In the year ending June 30, governance-related resolutions averaged 33.9% support, holding steady. Notably, 46 of 231 governance votes received majority backing. Proposals on political contribution disclosures rose in popularity, with some securing over 50% approval, reflecting investor concerns over reputational risks. While most governance votes remain advisory and fall short of majority support, high-profile wins — like Charles Schwab’s annual director election — highlight growing consensus on governance reforms over more contentious ESG topics.

Anti-ESG Legislation Loses Momentum

Despite 106 anti-ESG bills introduced in 2025, only 11 passed across 10 US states, most with weakened provisions, reflecting backlash fatigue and economic concerns. According to Pleiades Strategy, the successful bills (mainly in Republican-led states like Texas and Florida) often included escape clauses and were heavily lobbied for by fossil fuel interests. While these laws aim to restrict ESG and DEI considerations, many are symbolic, with limited real impact.

EPA Moves to Rescind GHG Endangerment Finding

The US Environmental Protection Agency (EPA) proposed rescinding the 2009 Greenhouse Gas Endangerment Finding, a move that would strip its authority to regulate GHG emissions from sectors like transport and energy. The finding, originally issued under Obama, enabled key climate regulations by linking GHGs to public health risks. The EPA now claims the scientific basis is weaker than believed and that global warming projections are overly pessimistic. If finalized, the repeal would nullify all federal GHG standards for vehicles and heavy-duty engines. Environmental groups condemned the proposal as dangerous and legally dubious, signaling upcoming legal challenges.

Florida Subpoenas CDP and SBTi Over ‘Climate Cartel’ Claims

Florida’s attorney general has subpoenaed climate nonprofits CDP and SBTi in a probe targeting an alleged ‘climate cartel’ and potential antitrust violations. The investigation, announced by AG James Uthmeier, will examine whether the groups misled investors by offering paid services that influenced ESG scores and public endorsements, potentially amounting to deceptive trade practices. It also questions whether coordination between nonprofits and financial institutions manipulated markets. Legal experts view this as part of a broader Republican-led effort to chill ESG-aligned initiatives. While no complaint has been filed, observers believe the probe could pave the way for further action against other for-profit companies.

State Officials Continue to Pressure Major Investment Firms

A coalition of state treasurers and financial officers from 21 US states sent letters to major investment firms (including BlackRock, JPMorgan Chase, and Goldman Sachs) warning them against incorporating climate and sustainability factors into investment strategies and proxy voting activities. The officials criticized ESG investing as ideological and urged firms to abandon practices such as using climate change as a long-term risk, aligning with global sustainability frameworks like the EU’s CSRD, or engaging in activist proxy voting. They demanded firms show evidence that their investment practices and affiliations align with “traditional fiduciary standards” and warned that failure to do so could jeopardize their eligibility for managing state funds.

BlackRock, Vanguard, and State Street Face ESG Antitrust Lawsuit

A US judge also ruled that an antitrust lawsuit against BlackRock, Vanguard, and State Street over alleged ESG-related coal market manipulation can proceed. The case, led by Texas and 10 Republican states, claims the asset managers colluded to cut coal production by using their influence through climate initiatives like NZAM and Climate Action 100+. While the court acknowledged a lack of direct evidence, it found enough circumstantial support to let the case move forward. The firms deny wrongdoing, calling the claims baseless and politically motivated, and plan to continue defending themselves.

MORE INTERESTING NEWS

Latest developments, reports, insights, and trends

🇪🇺 Some things happened in the EU as well:

The European Financial Reporting Advisory Group (EFRAG) released revised Exposure Drafts of the European Sustainability Reporting Standards (ESRS), significantly simplifying and reducing the reporting burden for companies under the EU’s CSRD. The updated drafts eliminate all voluntary disclosures and reduce total reporting datapoints by 57-68%, exceeding earlier estimates. Responding to concerns over the complexity of the original standards — particularly around the double materiality assessment — EFRAG introduced practical guidance, clearer criteria, and a proportionality principle to streamline topic selection and evidence requirements. Additional changes enhance readability, interoperability with IFRS sustainability standards, and include cost-relief mechanisms. The revised ESRS are now over 55% shorter, and EFRAG has launched a 60-day consultation period ending September 29, 2025, with final standards expected by November 2025.

The European Commission also adopted the Voluntary Standard for SMEs (VSME), a new sustainability reporting framework designed to help micro-, small-, and medium-sized enterprises disclose ESG information in a simplified and consistent manner. Initially intended for businesses outside the scope of the EU’s CSRD, the VSME is expected to become increasingly relevant due to the Commission’s Omnibus initiative, which proposes to exempt most smaller companies from mandatory reporting. Developed by EFRAG, the VSME aims to support SMEs in meeting data requests from larger companies and financial institutions, improving access to finance, and managing their own sustainability impacts.

The European Commission launched a consultation for its upcoming Circular Economy Act, aiming to double the EU’s circularity rate by 2030. The Act will address resource dependency, inefficiency, and environmental externalities, with key goals including boosting the market for secondary raw materials and increasing demand for recycled content. Initial focus areas include tackling e-waste and reforming rules around waste and recycling markets. The consultation is open until November 6, 2025, with adoption planned for 2026.

Over 300 investors, companies, and organizations are urging EU policymakers to safeguard the double materiality principle at the heart of the CSRD. A public letter coordinated by Eurosif warns that proposed Omnibus amendments may weaken vital sustainability rules, risking EU competitiveness and transparency. Signatories — including Allianz, IKEA, and B Lab — stress that the ESRS must remain aligned with global standards (GRI, ISSB) and continue to require disclosures on both impacts and risks. The call echoes growing global support, as seen in the UN FfD4 outcome document, and highlights that 85% of companies already use double materiality in reporting. The deadline for endorsements is August 29.

WHAT ARE COMPANIES DOING?

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

🟢 Meta is piloting the use of mass timber to reduce the embodied carbon footprint of its data centers, replacing high-emission materials like steel and concrete. Mass timber, a durable engineered wood, can cut embodied carbon by up to 41% and reduce construction emissions and time. Meta declared it ensures sustainable sourcing through third-party audits and prioritizes climate-smart forestry.

🥜 Mars launched the ‘Protect the Peanut Plan,’ a new $5 million agri-science initiative to safeguard peanut crops from climate-related threats. The program aims to develop hardier peanut varieties resistant to drought, disease, and pests, building on Mars’ prior $10 million investment in peanut genome research. As one of the world’s largest peanut buyers, Mars is partnering with institutions like the University of Georgia and USDA ARS to secure long-term peanut supply for products like M&Ms and Snickers.

EVERYTHING FINANCE

Sustainable finance, funding rounds, acquisitions & private equity deals

🏦 Barclays announced its exit from the UN-backed Net-Zero Banking Alliance (NZBA), becoming the second major UK bank to withdraw following HSBC’s departure last month. In its statement, Barclays cited the dwindling membership of global banks as undermining the NZBA’s ability to support its transition efforts, but reaffirmed its net zero by 2050 ambition, its $1 trillion sustainable finance goal by 2030, and recent progress, including $660 million in revenues from sustainable finance in 2024 and $220.2 billion mobilized to date.

🇪🇺 The European Central Bank (ECB) announced the introduction of a new “climate factor” within the Eurosystem’s collateral framework, aimed at managing climate-related financial risks by adjusting asset valuations based on their exposure to transition shocks. The measure, set to take effect in the second half of 2026, will reduce the value assigned to collateral from counterparties if the assets are deemed vulnerable to climate transition risks, thereby lowering the amount the ECB is willing to lend against them. The climate factor will be calculated using an uncertainty score combining sector-level data, issuer-specific exposure, and asset-level vulnerability, and will apply to marketable assets issued by non-financial corporations and their affiliates.

🏗️ CRH will acquire Eco Material Technologies for $2.1 billion to strengthen its cementitious materials position in North America and support infrastructure modernization. The deal secures long-term access to key materials like fly ash and synthetic gypsum, expands CRH’s distribution network, and adds over 1,100 employees. Eco Material, which processes 10 million tons of materials annually, will retain its name and operate under CRH.

⚡️ Alternative asset manager Ares formed a new joint venture, Tango Holdings, with Shell subsidiary Savion Equity to invest in solar power generation across the US, with Ares holding an 80% stake and Savion the remaining 20%. The newly launched entity will oversee a 496 MW portfolio of solar projects developed by Savion across the US, and will retain equity interests in three additional projects under construction.

📈 Nuveen and its sustainable real estate financing arm, Nuveen Green Capital, raised $785 million to expand their C-PACE lending, giving insurers access to long-term, impact-focused assets. C-PACE helps fund energy, water, and climate upgrades for commercial buildings. In 2024, NGC-backed projects cut CO₂ equal to 407,000 acres of forest, saved 461M gallons of water, reduced energy use by 585 MWh, and supported 2,100+ new housing units.

Funding rounds:

⚡️ Octopus Australia secured over A$1 billion (US$640 million) from Dutch pension investor APG to scale its renewable energy platform OASIS. The partnership will accelerate utility-scale solar, wind, and battery storage projects, marking one of the largest institutional investments in Australia’s energy transition.

🚐 Zenobē secured €325 million in debt financing to scale its electric fleets-as-a-service offering across Europe. The funding will support up to 1,000 electric buses, trucks, and chargers in the EU/EEA, expanding on its existing support for over 3,400 vehicles worldwide.

🔋 Pulse Clean Energy secured £220 million from six global banks to build six battery storage sites across the UK, supporting grid resilience and clean energy goals. The projects will deliver over 700MWh of capacity and are expected to save UK consumers over £200 million in gas and emissions costs.

🟢 Advanced materials company Lyten raised $200 million in equity funding to support its acquisition strategy, as it continues to acquire assets from bankrupt EV battery maker Northvolt. The move follows Lyten’s earlier acquisitions of Northvolt’s Cuberg battery facility in California and the Northvolt Dwa BESS manufacturing plant in Poland. 

🔋 Greenvolt secured a €150 million capital injection from KKR to fast-track its expansion in large-scale battery energy storage systems (BESS). Operating across 20 markets in Europe, North America, and Asia, Greenvolt focuses on Sustainable Biomass, Utility-Scale renewables, and Distributed Generation.

📊 Tanso raised €12 million in Series A funding to expand its sustainability software for industrial companies. Founded in 2021, Tanso offers a cloud-based platform that automates environmental compliance and carbon accounting, helping companies meet EU regulations like CSRD. The software is used by 300+ companies in over 40 countries, including Kärcher and Paulaner.

⚡️ Planted Solar, a California-based solar deployment solutions provider, raised $12 million in a new funding round to expand its platform and accelerate the rollout of solar projects. The company claims its platform enables deployment on slopes up to 27%, cuts land use by 50%, reduces steel needs by 70%, and delivers energy at 30% lower cost.

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