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From Compliance to Performance: Sustainability in 2026 and Resilience in Corporate Governance
The year 2025 marked a turning point for corporate sustainability, witnessing a necessary "collision" between the momentum of ESG regulations and complex economic and political realities. While this decade began with bold climate goals, we are now officially entering an era of execution and precision reporting. In this landscape, investor confidence, access to capital markets, and the long-term value of companies are directly dependent on the ability to operationalize sustainability.
Retrospective 2025: What have the main ESG developments taught us?
In 2025, we witnessed a paradigm shift. Sustainability is no longer just the responsibility of an isolated department, but a lens through which risk and resilience are managed throughout the entire organization, says Gabriela Hârțescu, Dean and Founder of Envisia, in a recent article for Financial Intelligence.
Biodiversity has become a material risk
According to the Global Biodiversity Framework (GBF) and the methodology of the Taskforce on Nature-related Financial Disclosures (TNFD), biodiversity loss is now assessed as a direct financial risk to supply chains.
Scope 3 Decarbonization:
Indirect emissions across the entire value chain have become priority zero, forcing companies to collaborate closely with suppliers to achieve credible targets.
Artificial Intelligence Integration
Companies have begun using AI to standardize massive sets of ESG data, reducing manual effort and improving the auditability of reporting.
Circular Economy Gains Legal Force
Through Extended Producer Responsibility (EPR) schemes, post-consumer waste management has moved from aspiration to financial obligation.
Forecasts for 2026: The Role for the Board of Directors
As we move into 2026, the "enthusiasm" of early reporting gives way to strategic optimization. Here are the pillars that will define corporate governance in the coming year:
The Regulatory Tipping Point: CSRD and CSDDD
The year 2026 will be marked by the entry into force of the Corporate Sustainability Due Diligence Directive (CSDDD) for large companies and the expansion of CSRD requirements in Europe. This will create a "flywheel" effect, requiring SMEs in the supply chain to provide high-quality ESG data.
Digital Product Passport (DPP)
The DPP is becoming the backbone of transparency in the EU, mandatory for sectors such as batteries, textiles, and electronics. Without this "digital passport" certifying the origin of materials, access to the European market will be restricted.
Water and Regenerative Thinking
Water stress is rising on the global agenda, becoming a core ESG indicator. In parallel, we are witnessing the maturation of the concept of regeneration: moving from "doing less harm" to business models that actively repair ecosystems.
Checklist 2026: Risk Management for Modern Boards
To navigate this complex landscape, board members should address the following key questions to executive management:
- Supply Chain Resilience (Scope 3): "How are we monitoring the emissions of our critical suppliers, and what contingency plan do we have for partners who will not be able to meet the new decarbonization standards by 2026?"
- Market Access and DPP: "Are our products prepared for the implementation of the Digital Product Passport? Do we have the necessary digital traceability to avoid being blocked from exporting to the EU?"
- Data Governance and AI: "How are we using Artificial Intelligence to ensure our ESG data is as robust and auditable as our financial reporting, avoiding greenwashing risks?"
- Upskilling: "Do we have the necessary competencies within the organization (and at the board level) to understand EFRAG and ISSB legislative milestones, or are we relying solely on external consultants?"
- Regenerative Strategy: "Beyond mere legal compliance, how are we integrating circular economy principles to reduce costs associated with EPR taxes (Extended Producer Responsibility) and create long-term value?"
Conclusion: Sustainability as a Competitive Advantage in Business
If there is a central message for 2026, it is this: Sustainability is now a core business capability, not a PR exercise. The best-prepared organizations will be those that approach risk and innovation with equal clarity, transforming legislative obligations into sustainable competitive advantages.
To make this transition from compliance to strategic performance, leaders must constantly update their knowledge. Participating in specialized programs, such as the postgraduate program "Corporate Governance that Creates Value - Governance in Practice," provides boards of directors with the necessary tools to navigate ESG complexity and to govern with rigor and vision.
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