June 2026 Newsletter

Top sustainability stories from May 2026.

NYC Pension funds challenge BlackRock and Fidelity on net zero alignment

New York City’s pension funds have publicly challenged BlackRock and Fidelity, stating that their investment and stewardship practices are not adequately aligned with the funds’ net zero objectives. According to the funds, both managers have fallen short on key expectations, including robust climate voting records, credible transition planning, and consistent engagement with high-emitting companies. The criticism reflects concerns about the gap between headline climate commitments and real-world implementation, particularly in passive strategies. NYC’s funds emphasise the need for clearer evidence of emissions reduction progress, stronger accountability, and tangible alignment with long-term decarbonisation targets embedded in their climate investment policies.

SEC signals withdrawal of climate disclosure rules amid legal challenge

The US Securities and Exchange Commission (SEC) is expected to inform a court that it intends to withdraw its proposed climate disclosure rules, marking a significant shift in federal ESG regulation. The rules, which aimed to require companies to report greenhouse gas emissions and climate-related risks, have faced strong legal and political opposition. The move reflects broader regulatory uncertainty in the US over mandatory climate reporting, particularly following challenges from business groups and state officials. Scrapping the rules would ease compliance pressure on companies but raises concerns among investors seeking consistent, decision-useful climate data and greater transparency on financial risks.

New York delays climate targets in budget deal

New York Governor Kathy Hochul has agreed to delay key elements of the state’s landmark climate law as part of a broader budget compromise, pushing back timelines for emissions reductions and easing certain near-term mandates. Measures affecting building emissions standards and compliance requirements were softened or postponed amid concerns over housing affordability, cost pressures, and implementation challenges. While the administration maintains its long-term net zero targets under the Climate Leadership and Community Protection Act, critics warn the changes could undermine policy momentum and certainty.

Extreme weather risks could drive $900bn in corporate losses, CDP warns

Companies worldwide could face up to $900 billion in financial losses from extreme weather impacts, according to CDP. The report finds that physical risks, including flooding, storms, and heatwaves, are already disrupting operations, supply chains, and asset values in more than half the reporting companies. Despite this, only around one-fifth have comprehensive adaptation plans in place, leaving them increasingly exposed to escalating climate shocks. The reports  also finds that climate-related risks identified by companies total trillions of dollars in potential impact. CDP emphasises that these risks are reshaping capital allocation and business resilience strategies, with investors demanding clearer disclosure and mitigation plans.

ECB updates guidance on managing climate and nature-related financial risks

The European Central Bank has released an updated compendium outlining good practices for managing climate and nature-related financial risks, aimed at strengthening banks’ risk frameworks. The guidance outlines stronger expectations on governance, data, and integration of environmental risks into core risk frameworks, including credit and operational assessments. It highlights gaps in how institutions assess dependencies on ecosystems and biodiversity loss. While progress has been made on climate risk, the ECB notes that nature risks remain less developed and poorly quantified. The update signals increasing supervisory pressure for banks to better capture, manage, and disclose interconnected climate and nature-related financial risks.

TISFDD launches framework to strengthen human rights and social impact disclosure

The Taskforce on Inequality and Social-related Financial Disclosures (TISFD) has launched a proposed framework to guide companies in reporting on human rights and social impacts. It focuses on people‑related factors such as labour conditions, access to services and value‑chain impacts, which are currently fragmented and difficult to compare. It builds on existing sustainability standards, aligning with frameworks such as TCFD, TNFD, and ISSB while addressing gaps in social data and encouraging integrated consideration of social, climate and nature issues. The framework has been issued for consultation until 31 July 2026. Read our full article here.

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