🌍Global Carbon Regulations

Global Frameworks & Regulations

EU ETS, CBAM, GRI, TCFD, CDP, SBTi — international carbon regulations and reporting frameworks that affect Asian businesses.

🇪🇺 EULive — largest carbon market by volume

EU ETS (Emissions Trading System)

EU ETS covers ~40% of EU greenhouse gas emissions. Applies to power plants, industrial facilities, and aviation within the EU. Price: €55–70/tCO₂ (2026). Relevant for Indian/Asian companies with EU subsidiaries or EU-based supply chain partners.

· Price: ~€62/t (2026 avg)
· Covers: Power, Industry, Aviation
· Phase 4: 2021–2030 (annual cap reduction 4.4%/yr)
· CBAM links: EUA price determines CBAM levy
🇪🇺 EUObligations from 2026

EU CBAM (Carbon Border Adjustment Mechanism)

CBAM imposes a carbon levy on imports of steel, cement, aluminium, fertilisers, hydrogen, and electricity from non-EU countries. Indian exporters must report embedded emissions quarterly and purchase CBAM certificates.

· Sectors: Steel, Cement, Aluminium, Fertilisers, H₂, Electricity
· Q1 2026: Transitional reporting phase started
· Full obligation: Jan 2027 (for 2026 exports)
· Price link: Tied to EU ETS price (~€62/t)
🌐 GlobalBest Practice / Often Required by Investors

GRI Standards (Global Reporting Initiative)

GRI is the world's most widely used sustainability reporting framework. GRI 305 covers emissions disclosures (Scope 1, 2, 3). Many large buyers and investors require GRI-aligned reporting as a condition of doing business.

· GRI 305: Emissions (Scope 1, 2, 3)
· GRI 302: Energy
· Universal Standards (GRI 1, 2, 3) from 2023
· Free to use — no licence required
🌐 GlobalMandatory in UK/NZ/Singapore, Investor-Required Globally

TCFD (Task Force on Climate-Related Financial Disclosures)

TCFD's 4-pillar framework (Governance, Strategy, Risk Management, Metrics & Targets) is used by investors to assess climate risk. SGX mandates TCFD for large-cap listed companies. ISSB IFRS S2 is built on TCFD.

· 4 pillars: Governance, Strategy, Risk, Metrics
· ISSB IFRS S2 aligns with TCFD (from 2024)
· SGX: Mandatory for large-cap
· Used by: Investors, banks, insurers globally
🌐 GlobalVoluntary — A-List Score Highly Valued

CDP (Carbon Disclosure Project)

CDP runs the world's largest environmental disclosure system. Companies, cities, and regions disclose climate, water, and forest data annually. An A-List score signals leadership and is valued by institutional investors.

· Annual questionnaire (climate, water, forests)
· A-D scoring (A-List = leadership)
· 2023: 23,000+ companies disclosed
· Linked to SBTi and GRI
🌐 GlobalVoluntary — Fastest Growing Corporate Standard

SBTi (Science Based Targets initiative)

SBTi validates corporate emission reduction targets aligned with 1.5°C science. Near-term target: 42% reduction by 2030. Net-zero standard: 90%+ reduction by 2050. Over 7,000 companies globally have committed.

· Near-term: 42% reduction by 2030
· Net-zero: 90%+ reduction by 2050
· Sector-specific pathways available
· Free validation — but requires GHG inventory

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