The final quarter of 2024 saw significant regulatory updates across major markets. These changes, focused primarily on reporting, AI governance, and climate, reflect a global shift toward greater accountability and transparency. Here’s what you need to know about the developments that took place last quarter.
These excerpts have been taken from our comprehensive Quarterly Policy Brief, which is provided to Datamaran clients every three months.
Europe: Simplifying Sustainability, Strengthening Governance
European policymakers made sustainability reporting a priority. The proposed "omnibus simplification package" aims to ease compliance with the CSRD, CSDDD, and Taxonomy Regulation. While these regulations remain separate, changes proposed under the package could include revised size thresholds and fewer required data points in sustainability reporting.
The EU introduced stricter governance measures, including a regulation on ESG rating providers that mandates transparency in methodologies and the publication of separate environmental, social, and governance scores. Another new regulation, the EU Regulation on Prohibiting Products Made with Forced Labour on the Union Market (FLR), was introduced, banning products made with forced labor, and introducing additional supply chain transparency requirements for businesses.
AI regulation advanced with the release of the second draft of the General-Purpose AI Code of Practice, emphasizing risk management and ethical principles. On the cybersecurity front, the Cyber Resilience Act introduced EU-wide standards for securing digital products like IoT devices.
France released updated sustainability reporting guidance to help businesses align with CSRD requirements. Denmark proposed allowing independent providers to offer assurance services for sustainability reports, increasing flexibility and competition in the assurance market. The proposed law allows independent providers, beyond traditional auditors, to issue sustainability reporting certifications. The law establishes conditions for the registration and approval of non-auditor entities to provide assurance services. If it comes into force, this law will enable businesses to choose assurance providers that better meet their needs, which is particularly relevant as EU-wide sustainability reporting requirements under CSRD expand in scope.
In Switzerland, the Swiss Federal Council proposed amendments to its Climate Issues Reporting Ordinance. This includes mandatory net-zero transition plans for businesses, especially in the financial sector, and reporting standards aligned with international frameworks. Reports must be both human- and machine-readable to ensure interoperability with global platforms.
North & South America: Aggressive Climate and AI Regulations
In the United States, Q4 brought significant climate and AI-related policies. New York’s Climate Change Superfund Act holds large greenhouse gas emitters accountable, requiring them to pay $75 billion over 25 years for climate adaptation infrastructure. The EPA’s National Strategy to Prevent Plastic Pollution targets single-use plastics and calls for an Extended Producer Responsibility framework. California is moving forward with SB 54, a law that sets stricter compliance requirements for packaging and waste reduction.
AI governance is expanding at both the federal and state levels. Texas introduced the Responsible AI Governance Act, focusing on transparency and bias mitigation. The FDA released draft guidance on AI use in drug development, setting expectations for safety and transparency.
Canada introduced draft regulations to cap greenhouse gas emissions from the oil and gas sector. These regulations target upstream facilities and liquefied natural gas production, offering flexibility through offset credits for compliance.
Québec expanded its environmental legislation to strengthen biodiversity protections. The updates include stricter forestry, agriculture, and mining practices and increased penalties for violations. Québec also supports energy-efficient technologies and renewable energy solutions to reduce emissions.
Chile unveiled its Decarbonization Plan to transition to a carbon-neutral electricity sector by 2050. Key measures include replacing coal-fired power plants with renewable energy and repurposing thermal facilities using green hydrogen. The plan prioritizes grid modernization, clean electrification, and just economic transitions for affected workers and communities.
Chile also updated its General Law on Electrical Services, integrating climate goals into energy regulations. This included provisions to streamline the development of transmission projects and support energy storage innovation.
Asia Pacific: Leading in AI and Sustainability
Asia Pacific countries are advancing ESG policies and AI governance. South Korea passed Asia’s first comprehensive AI regulation, emphasizing safety, transparency, and ethical AI deployment.
In Hong Kong, a new roadmap for sustainability disclosures requires publicly accountable entities to adopt ISSB standards by 2028. Thailand’s Securities and Exchange Commission proposed enhancements to sustainability disclosure rules for listed companies. These updates align with ISSB standards, focusing on transparency and consistency to meet investor demands.
Australia introduced a Cyber Security Legislative Package with mandatory ransomware reporting and stricter protections for critical infrastructure. India released guidelines to combat greenwashing. These rules require companies to substantiate environmental claims with clear evidence and avoid ambiguous terms like "sustainable" or "eco-friendly."
Japan updated sustainability metrics reporting to align with financial reporting, aiming for better integration between financial and non-financial disclosures. Meanwhile, Taiwanese legislators drafted amendments to its Personal Data Protection Act. These changes focus on mandatory data breach reporting, appointing data protection officers, and prioritizing inspections in high-risk industries.
Looking Further Ahead
Q4 2024 highlighted how countries worldwide are pushing businesses to adopt stricter, more transparent practices. These regulations are not just about compliance—they reflect a growing expectation that companies take active roles in addressing climate change, improving governance, and protecting data and biodiversity.
Chile’s energy reforms, Switzerland’s reporting mandates, and Canada’s emissions caps show that climate action is becoming non-negotiable. Initiatives in the UAE, India, and Taiwan signal that transparency and accountability are now baseline expectations, not optional goals. Global standards like those from the ISSB and TNFD further underline the need for consistent reporting and clear data.
Additionally, the ascension of Donald Trump to the U.S. Presidency for the second time is stoking geopolitical fears. Since January 20, several executive orders have been signed that have significant implications on federal laws relating to ESG. The Paris Climate Agreement, electric vehicles, wind projects, and more have all been targeted. It’s worth noting that most of these will face legal challenges and are likely to be struck down by the courts. That said, these are unprecedented times, and sustainability leaders should keep a close eye on developments in the U.S. for these could have a rippling effect on ESG initiatives worldwide.
Regulatory change is coming fast, and staying ahead of it will be a defining factor in long-term business success. Those who adapt quickly will not only meet these new rules but also find opportunities to innovate, reduce risks, and strengthen trust with investors and stakeholders.
For more information and practical advice on aligning your strategy with these recent policy developments, download our latest C-Suite Guide.
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