July - Aug 2026 Newsletter: Standards Expand, Capital Accelerates
With so much happening in the field of sustainability, we have decided to bring quality updates at more frequent intervals – such that they remain relevant, and you, dear readers, are updated with the latest news of what’s happening in the field of sustainability. We shall now be issuing monthly sustainability newsletters, with the exception of this month, where we shall be covering both July and August.
Like always, we have divided our newsletter into relevant sections for easy reading. Feel free to jump to the section of your interest. In case any topic interests you, feel free to click on the source links annexed with each news piece.
We would love to hear your feedback at info@esgityadvisors.com or in the comments section below.
Happy Reading!
COMPLIANCE UPDATES — how are sustainability related regulations and compliances changing?
The world's two most-used corporate GHG accounting frameworks are becoming one. GHG Protocol and ISO will fold GHG Protocol's Scope 1, 2, 3 and Actions & Market Instruments guidance together with ISO's 14064-1 standard into a single co-branded standard sparing companies the headache of reconciling both. A joint public consultation is planned for Q2 2027, with the merged standard targeted for around Q4 2028, positioned as a milestone under the COP30 Action Agenda.
EFRAG's draft standard for large non-EU companies with a significant EU footprint narrows the scope compared to the ESRS reporting for EU companies. The proposed draft requires disclosures only on environmental and social impacts, leaving out broader risk, opportunity and resilience disclosures. Thanks to the EU Omnibus, the pool of companies in scope has also shrunk from roughly 10,000 to about 1,200, and firms will get to choose between reporting global impacts or EU-only impacts, a flexibility some EFRAG members worry could dent comparability and open the door to greenwashing. Public consultation runs for 100 days, with a final standard expected in early 2027.
Singapore's draft disclosure standards, based on the ISSB framework, take a climate-first approach: Scope 1 and 2 reporting becomes mandatory, while Scope 3 and wider sustainability disclosures stay voluntary for now. It's a phased on-ramp rather than a big-bang mandate - a pattern showing up across several Asian regulators this year.
EcoVadis has opened access to ‘Community’, its sustainable supply-chain collaboration platform, to all procurement and sustainability professionals, and not restricted it to paying customers only. The idea is to create a shared space to swap best practices and troubleshoot supply-chain sustainability problems together, rather than everyone reinventing the wheel in their own silo.
INDUSTRY UPDATES — news from companies across sectors
Tesla has committed to net-zero emissions across its full value chain by 2040 while still arguing that conventional target-setting frameworks undercount the emissions its own products help avoid elsewhere. Disclosures have improved and the company plans to align reporting with IFRS standards. However, there is no published transition plan or near-term target yet, even as its operational and value-chain emissions keep climbing.
Salesforce is now publishing energy consumption and carbon emissions figures on the model cards for several of its AI models, using Hugging Face's open-source AI Energy Score. This makes Salesforce one of the first enterprise software players to put a number on its AI's footprint. More models are expected to get the same treatment as measurement methods mature. This is a trend worth tracking as AI's energy appetite becomes a bigger ESG talking point across the tech sector.
Just a month into H2 2026, micro-reactor funding has already broken the half-year record, at roughly US$ 1.23 billion, overtaking the buzzier small modular reactor (SMR) category, as nuclear’s fastest-growing investment theme. Micro-reactors can be built in a factory and shipped to site, sidestepping the cost and delay problems that dog conventional and even SMR-scale projects. Data centre and defence demand is a big part of what's pulling the capital in. Most developers are still in R&D rather than commercial operation, but public-market interest is starting to follow the money, mirroring the IPO wave already under way in the wider nuclear sector.
INVESTOR UPDATES — news developments on sustainable finance and sustainability-focused investors
The ECB announced it will extend its "climate factor" to a second, larger asset class. This climate factor is a valuation adjustment that measures how exposed an asset is to unexpected climate-transition shocks, and shrinks the asset's collateral value accordingly. Already applied to corporate bonds, the new step adds bank loans to non-financial corporations ("credit claims"), which make up roughly 29-30% of pledged collateral. The factor is built from three inputs: a sector-level climate stress score, the borrower's own transition risk, and the loan's remaining maturity. Riskier loans get marked down more with the maximum reduction capped at 5% of collateral value. The new rules are expected to phase in by end-2027, and will be updated yearly.
Investors poured a record US$ 12.6 billion into energy company IPOs in H1 2026, chasing the power demand boom from AI data centres with money flowing into generation, grid infrastructure, nuclear and geothermal. The catch: several newly listed names have struggled to hold their share prices once the IPO buzz wore off, a reminder that AI-driven energy enthusiasm and durable stock performance aren't the same thing.
The UN-backed Green Climate Fund has restructured its balance sheet to unlock an additional US$ 4 billion for new climate projects, taking total available funding to $5.65 billion over the next two years by holding less capital in reserve. The GCF estimates this could catalyse at least US$ 16 billion in total climate investment through co-financing in developing countries.
Green bonds hit a record US$ 193 billion in Q2 2026, per Moody's, powered by a 34% jump in European issuance. Europe alone accounted for 58% of all labelled sustainable bond issuance in the quarter. Blue bonds also had a standout run, up roughly sixfold year-on-year to US$ 3.7 billion in H1. The one laggard: sustainability-linked bonds were down 63% year-to-date, as issuers seem to prefer the certainty of use-of-proceeds structures over performance-linked ones.
Impact investor responsAbility has raised US$ 461 million at the final close of its Asia Climate Fund. The fund follows a private-credit strategy targeting renewable energy, electric mobility, energy efficiency and climate infrastructure across South and Southeast Asia. The fund leans on blended finance to pull private capital into a region where climate financing gaps remain large.
INDIA UPDATES — news shaping India's sustainability landscape
NIIF's US$ 600 million India-Japan Fund plans to deploy its remaining capital over the next 18-24 months, with roughly two-thirds of the portfolio earmarked for climate-focused sectors - mobility, energy efficiency, energy transition and waste recycling and the rest for the wider India-Japan business corridor. The bilateral fund, backed 49% by the Government of India and 51% by Japan's JBIC, has already backed names like Ather Energy and Eka Mobility.
Baroda BNP Paribas Mutual Fund pulled in over INR 1,200 crore through two new thematic launches: the ESG Best-in-Class Strategy Fund (about INR 640 crore) and a Services Fund (over INR 590 crore), with applications from more than 5,700 pin codes. This demonstrates solid evidence that ESG-themed investing continues to find retail appetite well beyond India's metros.
Affordable housing lender HomeFirst Finance is scaling its green-certified home portfolio toward 10,000 units, up from just over 600 certified so far, through a programme built with the IFC as groundwork for issuing green bonds down the line. The logic is that a large enough green home book could open the door to cheaper, sustainability-linked capital from foreign pension funds and other ESG-focused lenders.
Avaada Group has signed an MoU with the Haryana government to develop a 300-acre “Zero-CBAM” green industrial campus in Hisar, envisioned at an investment of roughly INR 10,000 crore and with the potential to create over 5,000 jobs. The campus is designed to run on round-the-clock renewable power, positioning tenant manufacturers to meet the EU's Carbon Border Adjustment Mechanism and similar requirements from day one - an early example of industrial infrastructure being built CBAM-ready rather than retrofitted later.
That's a wrap for July-August. See you next month.
Best Regards,
Team Esgity Advisors
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