ESG ratings, climate risk and sustainability disclosures

Global regulators advance ESG ratings, climate risk and sustainability disclosure rules

Financial regulators across the European Union, Japan, Korea and Singapore are continuing to strengthen requirements around ESG ratings, climate risk management and sustainability disclosures, according to Bloomberg’s August 2026 Global Regulatory Brief. The developments reflect growing regulatory attention on the quality and transparency of sustainability information, as well as the financial sector’s ability to manage physical and transition climate risks.

In the European Union, new technical standards under the ESG Ratings Regulation introduce detailed requirements for ESG ratings providers. These include public disclosures on rating methodologies, data sources, governance, business and fee models, conflict-of-interest management, and measures to ensure data quality and reliability. The standards also establish safeguards to maintain the independence of ESG rating activities and separate them from other business activities.

In Japan, the Financial Services Agency found that banks and insurers increasingly recognise storms and floods as material climate-related risks. Financial institutions are using more granular data, scenario analysis, hazard maps, supply-chain analysis and catastrophe modelling to assess these risks. Banks are also integrating physical climate considerations into lending decisions, while insurers are refining underwriting models and institutions are expanding adaptation finance and risk-management support for clients.

Korea has finalised a phased sustainability disclosure roadmap that will introduce mandatory statutory ESG reporting for large KOSPI-listed companies from 2028. The requirements will initially apply to companies with consolidated assets of at least KRW 10 trillion before expanding to smaller companies. Third-party verification will become mandatory from 2030, while Scope 3 emissions reporting has been deferred by three years for all tiers.

In Singapore, the Monetary Authority of Singapore’s Sustainability Report 2025–2026 highlights continued efforts to strengthen financial-sector resilience to climate risks and mobilise capital for Asia’s low-carbon transition. MAS has issued transition-planning guidelines for financial institutions, conducted climate scenario analysis and worked with SGX on climate-related disclosure requirements for listed issuers. It is also continuing efforts to improve market integrity through stronger disclosure standards and measures addressing greenwashing.  

Across these markets, the regulatory developments show sustainability regulation continuing to evolve across corporate disclosures, ESG ratings, climate-risk management and sustainable finance, with regulators placing increasing emphasis on reliable data, transparency and climate resilience.

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