{"id":141472,"date":"2026-05-01T15:11:21","date_gmt":"2026-05-01T15:11:21","guid":{"rendered":"https:\/\/my.legal500.com\/guides\/?post_type=comparative_guide&#038;p=141472"},"modified":"2026-05-01T15:11:21","modified_gmt":"2026-05-01T15:11:21","slug":"china-environmental-social-and-governance","status":"publish","type":"comparative_guide","link":"https:\/\/my.legal500.com\/guides\/chapter\/china-environmental-social-and-governance\/","title":{"rendered":"China: Environmental, Social and Governance"},"content":{"rendered":"","protected":false},"template":"","class_list":["post-141472","comparative_guide","type-comparative_guide","status-publish","hentry","guides-environmental-social-and-governance","jurisdictions-china"],"acf":[],"appp":{"post_list":{"below_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">Hui Ye Law Firm<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2025\/03\/Hui-Ye-Law-Firm.jpg\"\/><\/span><\/div>"},"post_detail":{"above_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">Hui Ye Law Firm<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2025\/03\/Hui-Ye-Law-Firm.jpg\"\/><\/span><\/div>","below_title":"<span class=\"guide-intro\">This country specific Q&amp;A provides an overview of Environmental, Social and Governance laws and regulations applicable in China<\/span><div class=\"guide-content\"><div class=\"filter\">\r\n\r\n\t\t\t\t<input type=\"text\" placeholder=\"Search questions and answers...\" class=\"filter-container__search-field\">\r\n\t\t\t<\/div>\r\n\r\n\t\t\t\r\n\r\n\r\n\t\t\t<ol class=\"custom-counter\">\r\n\r\n\t\t\t\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Climate \u2013 the law governing operations that emit Greenhouse Gases (e.g. carbon trading) is addressed by Environment and Climate Change international guides, in respect of ESG:  a. Is there any statutory duty to implement net zero business strategies;  b. Is the use of carbon offsets to meet net zero or carbon neutral commitments regulated;  c. Have there been any test cases brought against companies for undeliverable net zero strategies;  d. Have there been any test cases brought against companies for their proportionate contribution to global levels of greenhouse gases (GHGs)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>a.<\/strong> Is there any statutory duty to implement net zero business strategies;<\/p>\n<p>The Environmental and Ecological Code interprets green and low-carbon development obligations, which will come to effect on August 15 2026. Most jurisdictions impose reporting\/disclosure obligations or sectoral emission limits, but not a standalone legal duty to adopt and deliver a full net-zero strategy. Only a few jurisdictions have limited, direct mandates for large\/listed firms.<\/p>\n<p><strong>b<\/strong>. Is the use of carbon offsets to meet net zero or carbon neutral commitments regulated;<\/p>\n<p>Yes, the use of carbon offsets to achieve net zero or carbon neutral commitments is regulated internationally, regionally and nationally. Rules govern offset integrity, additionality, permanence, double-counting prevention, disclosure requirements and green-washing restrictions, with strict limits on relying solely on offsets to make climate claims.<\/p>\n<p><strong>c.<\/strong> Have there been any test cases brought against companies for undeliverable net zero strategies;<\/p>\n<p>Yes, numerous test cases have been brought against companies globally for undeliverable or misleading net-zero strategies, including landmark greenwashing lawsuits against TotalEnergies, JBS, Tyson Foods, and Santos, alleging unsubstantiated claims and lack of credible delivery plans.<\/p>\n<p><strong>d.<\/strong> Have there been any test cases brought against companies for their proportionate contribution to global levels of greenhouse gases (GHGs)?<\/p>\n<p>Yes, landmark test cases (e.g., Lliuya v. RWE, Milieudefensie v. Shell) have challenged companies over their proportionate contribution to global GHGs, with courts recognizing corporate liability for climate harms based on attributed emission shares.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Biodiversity \u2013 are new projects required to demonstrate biodiversity net gain to receive development consent?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, in many jurisdictions (notably England under the Environment Act 2021, mandatory 10% biodiversity net gain (BNG) for most developments from 2024; EU, Australia and others adopting similar rules), new projects must demonstrate BNG to obtain development consent, subject to limited exemptions. In China, we have not seen much requirements so far.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Water \u2013 are companies required to report on water usage?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, many large and listed companies are legally required to report water usage under mandatory ESG\/sustainability rules (EU CSRD, UK SFDR, China\u2019s water laws, CDP mandates, stock exchange rules), with targeted reporting for high water-use industries and water-stressed regions.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Forever chemicals \u2013 have there been any test cases brought against companies for product liability or pollution of the environment related to forever chemicals such as Perfluoroalkyl and Polyfluoroalkyl Substances (PFAS)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, thousands of test cases have been filed globally against major manufacturers (3M, DuPont\/Chemours, Arkema, Daikin, etc.) for PFAS-related product liability and environmental pollution, including groundwater contamination, personal injury, class actions, and state environmental lawsuits, with landmark settlements and rulings across the U.S., Europe, and elsewhere.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Circularity \u2013 a. The law governing the waste hierarchy is addressed by the Environment international guide, in respect of ESG are any duties placed on producers, distributors or retailers of products to ensure levels of recycling and \/ or incorporate a proportionate amount of recycled materials in product construction? b. Are any duties placed on producers, distributors or retailers of products to handle the end-of-life of the products placed on the market?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>a.<\/strong> The law governing the waste hierarchy is addressed by the Environment international guide, in respect of ESG are any duties placed on producers, distributors or retailers of products to ensure levels of recycling and \/ or incorporate a proportionate amount of recycled materials in product construction?<\/p>\n<p>Yes. Under international\/regional ESG and waste laws (notably EU Waste Framework Directive, EPR rules, UK\/EU packaging laws), producers, distributors, and retailers face mandatory duties:<\/p>\n<p>1\uff09To meet statutory recycling rate targets for products\/packaging<\/p>\n<p>2\uff09To fund\/operate collection &amp; recycling systems<\/p>\n<p>3\uff09For many goods (plastics, batteries, electronics), to include minimum recycled content in products<\/p>\n<p>4\uff09To report recycling performance &amp; meet ESG disclosure rules<\/p>\n<p>All align with the waste hierarchy (prevention \u2192 reuse \u2192 recycling \u2192 recovery \u2192 disposal) as core ESG compliance.<\/p>\n<p><strong>b.<\/strong> Are any duties placed on producers, distributors or retailers of products to handle the end-of-life of the products placed on the market?<\/p>\n<p>Yes. Under Extended Producer Responsibility (EPR) laws (global ESG &amp; waste rules), producers, distributors, and retailers all face mandatory end-of-life duties:<\/p>\n<p>1\uff09Producers (mfrs\/brand owners\/importers): Primary liability\u2014fund collection\/recycling, operate take-back, design for recyclability, report, register.<\/p>\n<p>2\uff09Distributors\/retailers: Must accept returns, facilitate take-back, label\/info consumers, verify supplier EPR compliance.<\/p>\n<p>3\uff09Applies to electronics (WEEE), batteries, autos, packaging, tyres, textiles; enforced via fines, product bans, market access restrictions.<\/p>\n<p>Notably, Article 959 of the Environmental and Ecological Code stipulates the establishment of EPR, and China\u2019s recent regulations and policies are benchmarked against those of leading areas.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Plastics \u2013 what laws are in place to deter and punish plastic pollution (e.g. producer responsibility, plastic tax or bans on certain plastic uses)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Globally, a three-pronged legal framework deters and punishes plastic pollution: bans\/restrictions on harmful plastics, plastic taxes\/levies, and mandatory Extended Producer Responsibility (EPR). All tie to ESG compliance, with penalties including fines, product bans, and market access restrictions.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Equality Diversity and Inclusion (EDI) \u2013 what legal obligations are placed on an employer to ensure equality, diversity and inclusion in the workplace?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes. Employers worldwide face binding legal duties for Equality, Diversity &amp; Inclusion (EDI), rooted in anti-discrimination laws, equal pay rules, reasonable adjustments for disability, public-sector equality duties, pay\/gap reporting, and ESG disclosure mandates (CSRD, stock exchange rules). Non-compliance brings fines, damages, tribunal claims, and reputational harm.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Workplace welfare \u2013 in respect of ESG are there any legal duties on employers to treat employees fairly and with respect?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes\u2014under ESG (and linked national\/ international law), employers have binding legal duties to treat employees fairly and with respect. These are not just ethical; they are enforceable, with penalties for breach, and form core \u201cSocial (S)\u201d obligations in ESG compliance.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Living wage \u2013 the law governing employment rights is addressed in the Employment and Labour international guide, in respect of ESG is there a legal requirement to pay a wage that is high enough to maintain a normal standard of living?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>1\uff09No general \u201cliving wage\u201d is a direct legal duty in most countries (including EU, UK, China).<\/p>\n<p>2\uff09But ESG + human rights due diligence laws (CSRD\/CSDDD) now create mandatory disclosure, due diligence, and gap-closing duties for large companies\u2014effectively making living wage a legally enforceable ESG obligation (not just voluntary).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Human rights in the supply chain \u2013 in relation to adverse impact on human rights or the environment in the supply chain:  a. Are there any statutory duties to perform due diligence;  b. Have there been any test cases brought against companies?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>a.<\/strong> Are there any statutory duties to perform due diligence;<\/p>\n<p>Yes, statutory due diligence duties exist across major jurisdictions\u2014binding on large companies for human rights and environmental harms in supply chains. Below is a concise, legally precise breakdown (EU, UK, Germany, China; ESG-enforceable).<\/p>\n<p><strong>b.<\/strong> Have there been any test cases brought against companies?<\/p>\n<p>Case 1: Milieudefensie v Shell (Netherlands)<\/p>\n<p>A landmark climate and human rights case. The court ruled Shell legally obliged to cut its overall GHG emissions, including emissions from its supply chain and end-use products. It set a precedent that parent companies are accountable for supply chain environmental and human rights impacts, not just their direct operations.<\/p>\n<p>Case 2: Modern Slavery Act enforcement (UK)<\/p>\n<p>Several UK large companies have faced legal action and penalties for failing to publish mandatory modern slavery supply chain statements. Courts confirmed employers can be fined and held legally responsible for ignoring human rights risks (forced labour, child labour) within their supplier networks, enforcing statutory supply chain due diligence disclosure duties.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Responsibility for host communities, environment and indigenous populations \u2013 in relation to adverse impact on human rights or the environment in host communities:  a. Are there any statutory duties to perform due diligence? b. Have there been any test cases brought against companies?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>a.<\/strong> Are there any statutory duties to perform due diligence;<\/p>\n<p>Yes\u2014statutory due diligence duties exist under EU CSDDD, French Duty of Vigilance, German LkSG, and emerging national laws. Companies must assess\/mitigate harm to host communities, environment, and indigenous peoples.<\/p>\n<p><strong>b.<\/strong> Have there been any test cases brought against companies?<\/p>\n<p>Yes, numerous landmark test cases have been brought against companies for causing environmental and human rights harm to host communities and indigenous populations, with courts holding parent companies legally accountable.<\/p>\n<p>Case 1: Wiwa v Shell (Nigeria)<\/p>\n<p>Local Ogoni indigenous community protested severe oil pollution and environmental damage caused by Shell\u2019s operations. Shell was alleged to have colluded with the Nigerian government to suppress community protests, leading to the execution of community leaders. The case set a key precedent that multinational corporations can be held liable for human rights abuses and environmental harm against indigenous host communities, eventually reaching a settlement.<\/p>\n<p>Case 2: Aguinda v Chevron (Ecuador)<\/p>\n<p>Chevron\u2019s predecessor dumped large volumes of toxic oil waste into the Ecuadorian Amazon, causing widespread pollution, serious illness and health damage to indigenous local communities. Courts ruled the company responsible for long-term environmental destruction and harm to host indigenous populations, establishing that parent companies are liable for overseas environmental contamination and impacts on local communities.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Have the Advertising authorities required any businesses to remove adverts for unsubstantiated sustainability claims?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes. Advertising authorities worldwide (notably the UK ASA) have repeatedly ordered companies to withdraw adverts containing unsubstantiated or misleading sustainability\/green claims, banning campaigns for vague terms like \u201csustainable\u201d without evidence.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Have the Competition and Markets authorities taken action, fined or prosecuted any businesses for unsubstantiated sustainability claims relating to products or services?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes. The CMA has investigated and secured formal undertakings (enforceable commitments) from businesses (e.g., ASOS, Boohoo, Asda) for unsubstantiated green claims, but no fines\/prosecutions (yet) under older laws; direct fining powers began April 2025.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Have there been any test cases brought against businesses for unsubstantiated enterprise wide sustainability commitments?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes. There are landmark test cases challenging enterprise-wide, unsubstantiated sustainability\/net-zero commitments (not just product claims), with courts increasingly holding companies liable for misleading broad climate pledges.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a statutory duty on directors to oversee environmental and social impacts?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, there is a clear statutory duty on company directors to oversee environmental and social impacts.<\/p>\n<p>Key rule (EU CSDDD)Under the EU Corporate Sustainability Due Diligence Directive (CSDDD), directors have a legal obligation to:<\/p>\n<p>Oversee environmental, human rights and social impacts across operations and supply chains;<\/p>\n<p>Integrate sustainability risks into corporate strategy and decision-making;<\/p>\n<p>Ensure proper due diligence, prevention, mitigation and remediation of harms.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Have there been any test cases brought against directors for presenting misleading information on environmental and social impact?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes. There have been high-profile test cases holding directors personally accountable for misleading ESG\/sustainability disclosures and unsubstantiated green claims.<\/p>\n<p>1\uff09ClientEarth v Shell plc directors (UK, 2022\u2013present)<\/p>\n<p>Landmark derivative claim against 13 Shell directors under s.172 Companies Act 2006.<\/p>\n<p>Alleged misleading climate disclosures and failure to adopt a Paris-aligned strategy, putting shareholders at risk.<\/p>\n<p>First major test holding directors personally liable for flawed\/overstated net-zero claims.<\/p>\n<p>2\uff09McGaughey v USS Ltd (UK, 2021\u20132023)<\/p>\n<p>Test case alleging directors misled pension fund members over fossil fuel risks and failed to disclose climate financial impacts.<\/p>\n<p>Courts clarified duties to disclose material ESG risks but set high hurdles for personal liability.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are financial institutions and large or listed corporates required to report against sustainable investment criteria?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes. Financial institutions, large and listed companies are legally required to report against formal sustainable investment and ESG criteria under mandatory disclosure rules (EU SFDR\/CSRD, UK SDR, China CSRC stock exchange requirements).<\/p>\n<p>1\uff09SFDR (Sustainable Finance Disclosure Regulation)Applies to banks, asset managers and insurers. It mandates disclosure of sustainability risks, adverse sustainability impacts, and the sustainable investment credentials of financial products.<\/p>\n<p>2\uff09CSRD (Corporate Sustainability Reporting Directive)Applies to large companies and all listed corporates. It requires detailed, standardised ESG disclosures and reporting aligned with sustainable investment and sustainability criteria.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a statutory responsibility on businesses to report on managing climate related financial risks?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, businesses including large, listed companies and financial institutions have a statutory legal duty to report how they manage climate\u2011related financial risks.<\/p>\n<p>1\uff09EU CSRD \u2013 Mandates companies disclose climate physical and transition financial risks, governance and risk management processes.<\/p>\n<p>2\uff09UK FCA \/ TCFD rules \u2013 Listed firms and financial entities must make mandatory climate financial risk disclosures aligned with TCFD.<\/p>\n<p>3\uff09ISSB (IFRS S1 \/ S2) \u2013 Legally adopted in many jurisdictions, requiring reporting on material climate risks and their financial impact.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a statutory responsibility on businesses to report on energy consumption?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, statutory duties to report energy consumption apply to large\/key energy-consuming businesses and listed companies in major jurisdictions.<\/p>\n<p>1\uff09China<\/p>\n<p>Energy Conservation Law (Art. 53)<\/p>\n<p>Key energy users (\u226510,000 tonnes coal equivalent\/year; or designated 5,000\u201310,000 tonnes) must file an annual Energy Utilization Report covering consumption, efficiency, targets and measures.<\/p>\n<p>Listed firms: CSRC\/ESG rules require disclosure of energy use, intensity and carbon emissions in annual reports.<\/p>\n<p>2\uff09EU<\/p>\n<p>Energy Efficiency Directive (EED)<\/p>\n<p>Large enterprises (&gt;250 staff, \u20ac50m turnover) must complete mandatory energy audits every 4 years and report consumption.<\/p>\n<p>3\uff09CSRD: All large\/listed companies must disclose energy use, intensity, efficiency and renewable energy in sustainability reports.<\/p>\n<p>Data centres: \u2265500kW IT power must publicly report energy consumption\/PUE annually.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a statutory responsibility on businesses to report on EDI and \/ or gender pay gaps?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, statutory duties to report on EDI (Equality, Diversity &amp; Inclusion) and gender pay gaps apply to large employers (100\u2013250+ staff) in major jurisdictions.<\/p>\n<p>1\uff09UK<\/p>\n<p>Gender Pay Gap Reporting: \u2265250 employees must publish annual data (mean\/median pay\/bonus gaps, pay quartiles) under Equality Act 2010 Regulations.<\/p>\n<p>EDI (Public Sector): Public bodies must report equality data &amp; objectives under the Public Sector Equality Duty (PSED).<\/p>\n<p>2\uff09EU<\/p>\n<p>CSRD: Large\/listed companies must disclose EDI, diversity, and gender equality metrics.<\/p>\n<p>Pay Transparency Directive (2023\/970):<\/p>\n<p>\u2265250 employees: Annual gender pay gap reports (from 2027).<\/p>\n<p>150\u2013249: Every 3 years (from 2027).<\/p>\n<p>100\u2013149: Every 3 years (from 2031).<\/p>\n<p>Gaps &gt;5% (unjustified) require joint pay assessments &amp; action plans.<\/p>\n<p>3\uff09China<\/p>\n<p>Listed companies: CSRC\/ESG rules mandate disclosure of gender diversity, board representation, and equal opportunity policies.<\/p>\n<p>No statutory gender pay gap reporting (voluntary\/disclosure-based).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a statutory responsibility to report on modern day slavery in the supply chain?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>EU CSRD &amp; CSDDD Large\/listed companies must disclose forced labour risks, due diligence and remediation in sustainability reports.<\/p>\n<p>UK Modern Slavery Act 2015 (s.54)\u2265 \u00a336m turnover (operating in UK) must publish an annual modern slavery statement on risks, due diligence and steps taken in operations and supply chains.<\/p>\n<p>Australia Modern Slavery Act 2018\u2265 A$100m revenue must submit an annual statement to a government register, covering risks, due diligence and remediation.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Trends and developments \u2013 Where do you see the most significant legal developments in ESG in your jurisdiction in the next 12 months? Do you expect a rise in Court disputes or enforcement actions?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Over the next 12 months (2026\u20132027), China will see sharp, rule-based ESG legal tightening, driven by mandatory disclosure, data liability, and board-level duties. Enforcement and court disputes will rise sharply, especially for greenwashing and false climate\/ESG disclosures.<\/p>\n<p>1\uff09Key legal developments (next 12 months)<\/p>\n<p>Full enforcement of mandatory ESG disclosure (2026 milestone)<\/p>\n<p>Rule: CSRC\/Stock Exch4anges require \u4e0a\u8bc1 180 \/ \u79d1\u521b 50 \/ \u6df1\u8bc1 100 \/cross-listed firms to publish audited Sustainability Reports for 2025 (due April 30, 2026).<\/p>\n<p>New standards: 3 new metrics (pollutants, energy, water) mandated; climate disclosures (IFRS S2-aligned) required.<\/p>\n<p>Board liability: Reports must be approved by directors; misstatements = personal liability (like financial fraud).<\/p>\n<p>2\uff09ESG data &amp; greenwashing crackdown<\/p>\n<p>Eco-Environment Code (2026): Strict liability for false carbon\/emissions data; fines + director sanctions.<\/p>\n<p>Forensic audits: Regulators target overstated net-zero, unsubstantiated green claims, and data gaps.<\/p>\n<p>Third-party assurance: Mandatory ESG audit rules (\u8d22\u653f\u90e8 2026) coming; weak assurance = penalties for firms\/auditors.<\/p>\n<p>3\uff09Director ESG duties codified<\/p>\n<p>Board responsibility: Law\/regulations now require directors to oversee climate risks, ESG controls, and disclosure accuracy.<\/p>\n<p>Civil\/criminal risk: Directors face fines, disqualification, and shareholder suits for negligent ESG oversight.<\/p>\n<p>Financial institutions: stricter green finance rules<\/p>\n<p>Banks\/insurers: Mandatory climate risk stress tests, ESG lending criteria, and TCFD reporting.<\/p>\n<p>Greenwashing penalties: False \u201csustainable product\u201d claims = heavy fines.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\r\n<div class=\"word-count-hidden\" style=\"display:none;\">Estimated word count: <span class=\"word-count\">2932<\/span><\/div>\r\n\r\n\t\t\t<\/ol>\r\n\r\n<script type=\"text\/javascript\" src=\"\/wp-content\/themes\/twentyseventeen\/src\/jquery\/components\/filter-guides.js\" async><\/script><\/div>"}},"_links":{"self":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide\/141472","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide"}],"about":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/types\/comparative_guide"}],"wp:attachment":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/media?parent=141472"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}