For more than a decade, the prevailing assumption in sustainability reporting was straightforward: when the European Union legislates, global markets adapt. This pattern, often observed in areas such as privacy or competition law, led many to expect that Europe’s sustainability reporting framework would eventually become the worldwide reference point. That expectation is now being quietly overturned. Across the market, companies, investors, and regulators are converging not around the EU’s reporting model, but around standards developed by the International Sustainability Standards Board (ISSB). Rather than becoming another regional framework, the ISSB has positioned itself as the common language for climate and sustainability disclosure worldwide. This shift reveals something important about how global governance actually functions when regulatory ambition meets economic reality.

As the holiday season approaches and we prepare to welcome 2026, all of us at Hermesnet LTD want to extend our warmest wishes to our clients, partners, and stakeholders. This time of year is about more than just celebration; it is a moment to pause and reflect on a year that has fundamentally reshaped the landscape of sustainability. For the ESG sector, 2025 has been a year of "regulatory shockwaves." From the introduction of the EU’s Omnibus Simplification Package to the evolving dynamics of the U.S. market, the global playing field has fractured. We have moved past the era of "wait and see." Today, transparency is no longer a choice—it is a baseline for survival in a global economy.

As companies step into 2026, the conversation around climate strategy looks very different from just a few years ago. Regulations are tightening, global supply chains remain fragile, and investors are looking far beyond basic disclosures. What once counted as progress now feels incomplete. Leaders are increasingly asked to demonstrate evidence, not intent. Below are five dynamics set to influence how organisations plan, invest, and compete in the year ahead.

California’s new climate disclosure mandates—Senate Bill 253 (GHG emissions) and Senate Bill 261 (climate-related financial risk)—have fundamentally shifted the US corporate sustainability landscape. They are not merely state rules; they are regulatory shockwaves that, by design, compel thousands of public and private companies across the country to adopt audit-ready, standardized climate accounting. As of late 2025, companies face a critical dual challenge: navigating ambitious, near-term reporting deadlines while operating under continued regulatory and legal uncertainty. The message, however, is clear: preparing for compliance is no longer optional.

In February 2025, the European Commission unveiled a sweeping Omnibus Simplification Package proposing substantial amendments to key EU sustainability regulations — chief among them the Corporate Sustainability Reporting Directive (CSRD). Framed as a recalibration rather than a rollback, the package aims to reduce complexity, lighten administrative burdens, and align obligations more tightly with size and capacity. Yet its implications are profound: the Omnibus shifts the balance between ambition and pragmatism in corporate ESG reporting, reshaping who reports, when, and how deeply.

The New Rules of Business: Why Your ESG Story Matters The world is changing. It's no longer enough for a company to simply report financial success. Today, customers, investors, and regulators are demanding a new level of transparency—not just about profit, but about purpose. The conversation has shifted from quarterly earnings to long-term impact, and from financial risk to environmental and social risk.

Most big companies now know that their Scope 3 emissions — the ones from their value chains — are often far larger than the emissions from their own operations. In many industries, Scope 3 makes up 70% to 90% of total emissions. Yet for years, these emissions went mostly unreported. That’s quickly changing. Investors, regulators, and customers across the U.S., U.K., and E.U. are demanding more clarity. And a web of new standards is turning Scope 3 disclosure from a nice-to-have into a must-do.

The trajectory of decarbonization within private equity (PE) and venture capital (VC) markets, increasingly driven by Environmental, Social, and Governance (ESG) principles, underwent a fascinating and disruptive rerouting during the Trump administration. This period created a divergent landscape across continents, challenging firms to recalibrate their strategies.

As of May 22, 2025, the global ESG playing field has fractured. Multinational companies now face sharply different rules depending on which side of the Atlantic they operate. The EU is tightening ESG disclosure rules, while the U.S.—under President Trump’s second term—is rolling them back at pace. This isn’t a forecast. It’s already happening. EU deadlines are locking in. U.S. rules are being unwound. If your strategy still hinges on “wait and see,” you’re nearly out of time.

As ESG becomes more embedded in business, the U.S. and Europe are heading in opposite directions. A second Trump administration has reignited an anti-ESG push, with conservatives framing it as partisan overreach. In contrast, Europe is doubling down with major regulations like the CSRD and EU Taxonomy. This split raises tough questions: Is ESG still a global standard, or is it fragmenting? And how should European firms navigate the fallout?

Sustainability has become a critical focus for businesses, investors, and regulators worldwide. Companies are under growing pressure to report their Environmental, Social, and Governance (ESG) performance, and many rely on publicly available ESG and sustainability reports to assess risks and make investment decisions. However, these reports come with major challenges, from data inconsistency to greenwashing risks. So, what’s the problem with relying on public ESG data, and how can it be solved?

As environmental concerns grow and regulations tighten, AI is becoming an essential tool in ESG (Environmental, Social, and Governance) analysis and carbon accounting. By improving how companies measure and report their carbon footprints, AI is reshaping financial markets and sustainable investment strategies. Its rapid development is challenging traditional market assumptions and driving new approaches to ESG risk management.

Happy New Year! As we step into 2025, we extend our heartfelt wishes for a prosperous and joyful New Year to all our stakeholders. Your continued trust and support have been the cornerstone of our journey, and we look forward to achieving even greater milestones together in the year ahead.

Carbon neutrality and net zero are critical, yet distinct, strategies in tackling emissions. Carbon neutrality balances emissions through offsets, offering a quicker but less transformative approach. Net zero aims to reduce emissions at the source, aligning with science-based targets for deeper, longer-term impact. Standards and certifications ensure transparency and accountability. Adopting these goals enhances brand reputation, meets investor expectations, and prepares organizations for evolving climate regulations.

The fight against climate change is a global endeavour, and the European Union is taking a leading role with its ambitious Green Deal. A cornerstone of this initiative is the Carbon Border Adjustment Mechanism (CBAM), a pioneering policy designed to prevent "carbon leakage" and ensure a level playing field for businesses inside and outside the EU.

The European Union's (EU) regulatory landscape is undergoing a seismic shift, with sustainability and climate action taking centre stage. The Corporate Sustainability Reporting Directive (CSRD), set to impact nearly 50,000 companies, represents a landmark moment in this transformation. At its core lies carbon accounting, a practice that transcends mere compliance and emerges as a strategic imperative for businesses striving for a sustainable future.

The fashion industry is at a critical juncture. It grapples with a massive environmental footprint, generating 92 million tons of textile waste annually, according to the Ellen MacArthur Foundation. But what if this waste wasn't a burden? What if it could be transformed into a catalyst for innovation, a driver of brand reputation, and a source of new revenue streams?

The landscape of private equity is undergoing a transformation. The urgency to address climate change and foster sustainable practices is reshaping investment strategies. Environmental, Social, and Governance (ESG) factors are no longer peripheral considerations. They are central to long-term value creation and risk mitigation. At the heart of this ESG revolution lies carbon accounting—the meticulous measurement, management, and reduction of carbon emissions.

In a world grappling with the urgent climate crisis, data has emerged as a critical tool in the fight against carbon emissions. As highlighted in the World Economic Forum's "The Environmental Impact of Industries: A Data-Driven Approach to Decarbonization," data plays a crucial role in understanding and reducing the carbon footprint across various sectors.

The modern business world demands more than just a healthy bottom line. Today, companies are increasingly judged on their Environmental (E), Social (S), and Governance (G) performance – the core principles of the 'ESG company'. ESG reporting is your chance to showcase your commitment to these values, and it comes with some serious benefits.

Q2 2024 was another quarter of exceptional growth for HERMESNET, marked by significant expansion in our customer base and the continued evolution of our AI-powered platform.

Carbon accounting is the process of measuring a company’s greenhouse gas (GHG) emissions, which are released from its activities and operations. These emissions, including carbon dioxide (CO2), methane (CH4), and nitrous oxide (N2O), are the main contributors to climate change.

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