David Carlin

The ESG "Soup" 🌎 The ESG landscape has developed into a complex system of frameworks, standards, and certifications. The growing number of instruments often increases complexity rather than providing clarity. Fragmentation limits comparability across companies and sectors. Stakeholders are left with uneven information that complicates evaluation and slows decision-making. Standardization and homologation are essential to ensure that reporting and assessment mechanisms produce consistent and reliable outcomes. The current environment shows clear overlaps and duplication. Some mechanisms contribute value, while others create parallel processes that dilute efficiency. Businesses are investing heavily in compliance management. This effort often outweighs the resources dedicated to advancing measurable progress on material issues. The lack of convergence across jurisdictions amplifies costs and complexity. Operating in multiple markets requires navigating parallel systems with little alignment. Professionals must identify which instruments strengthen credibility and which add administrative weight without strategic benefit. A scattered approach reduces the ability of stakeholders to distinguish between genuine impact and selective disclosure. The result is a weakening of trust. Homologation can transform certifications, benchmarks, and reporting frameworks into a coherent set of tools that support execution and transparency. Expansion of ESG mechanisms will continue, yet alignment remains limited. The imbalance between proliferation and integration threatens overall effectiveness. The ESG “soup” reflects a system under construction. The task ahead is to refine, simplify, and converge. Greater harmonization is the step that will allow ESG mechanisms to shift from administrative obligation to a driver of performance and accountability. #sustainability #business #sustainable #esg

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The question for CSOs shouldn’t be “what should I buy?” The carbon credit market has been through some rough years. Credibility challenges, demand change and falling prices.... Quite often, credits were used as part of PR strategy rather than a tool for real impact. But let’s not forget: 1. Decarbonization comes first 2. Credits complement and don't replace But one might ask, why carbon credits matter if we focus on decarbonisation? Large-scale carbon removal has to grow by 30 by 2030 and by 1000 times by 2050 to align with net zero targets. And carbon credits are one of the fastest ways to channel funding into these solutions. What CSOs must learn? - Your strategy is not a shopping list. Don’t ask “what can I buy?” Ask “what are my climate and business goals?” - Think long-term and diversify portfolio across different projects including carbon avoidance and nature-based. - Be transparent and report carbon reductions as well credit use openly. Don't only report your net zero target! What are 7 things you need to know about sustainability in 2025? Check out this: https://lnkd.in/dbTuvACp What is the cost of inaction? Check out this: https://lnkd.in/dfWk58eE ➡️ Follow Majd Fayyad for more insights about sustainability and decabonisation 🔄 Repost and share with CSOs in your network MajdTalks

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ESG teams in the UK must now transition from TCFD to ISSB reporting. What does this mean in practice for ESG managers? 1️⃣ What does TCFD involve? 2️⃣ What does ISSB involve? 3️⃣ What adjustments must managers make? Latest update from the UK's gov. -> https://lnkd.in/dF89d9FK 1️⃣ 𝐖𝐡𝐚𝐭 𝐝𝐨𝐞𝐬 𝐓𝐂𝐅𝐃 𝐢𝐧𝐯𝐨𝐥𝐯𝐞? TCFD = 4 pillars + 11 recommended disclosures → focus on climate-related financial risk transparency. - 𝐆𝐨𝐯𝐞𝐫𝐧𝐚𝐧𝐜𝐞: Board oversight; management’s role - 𝐒𝐭𝐫𝐚𝐭𝐞𝐠𝐲: Climate risks & opportunities; impact on business, strategy, and financial planning; resilience/scenario analysis - 𝐑𝐢𝐬𝐤 𝐌𝐚𝐧𝐚𝐠𝐞𝐦𝐞𝐧𝐭: Identifying, assessing, and managing climate-related risks - 𝐌𝐞𝐭𝐫𝐢𝐜𝐬 & 𝐓𝐚𝐫𝐠𝐞𝐭𝐬: Metrics used; GHG emissions (Scopes 1, 2, 3); targets 2️⃣ 𝐖𝐡𝐚𝐭 𝐝𝐨𝐞𝐬 𝐈𝐒𝐒𝐁 𝐢𝐧𝐯𝐨𝐥𝐯𝐞? 𝐈𝐅𝐑𝐒 𝐒𝟏 – General Requirements for Sustainability-related Financial Disclosures - Uses the TCFD 4-pillar framework: Governance, Strategy, Risk Management, Metrics & Targets - Applies to all sustainability-related risks and opportunities - Must explain how sustainability issues affect cash flows, access to finance, and cost of capital 𝐈𝐅𝐑𝐒 𝐒𝟐 – Climate-related Disclosures - Focuses specifically on climate risks and opportunities - Incorporates TCFD’s 11 recommended disclosures - 𝐀𝐝𝐝𝐬 detailed requirements on: transition plans, scenario analysis, GHG emissions (Scopes 1, 2, 3), and industry-specific metrics (via SASB guidance) 3️⃣ 𝐖𝐡𝐚𝐭 𝐦𝐮𝐬𝐭 𝐄𝐒𝐆 𝐦𝐚𝐧𝐚𝐠𝐞𝐫𝐬 𝐝𝐨 𝐭𝐨 𝐚𝐝𝐣𝐮𝐬𝐭 𝐫𝐞𝐩𝐨𝐫𝐭𝐢𝐧𝐠 𝐢𝐧 𝟐𝟎𝟐𝟔? ✅ Keep the 𝟒 𝐓𝐂𝐅𝐃 𝐏𝐢𝐥𝐥𝐚𝐫𝐬 – they stay the same! ✅ 𝐄𝐱𝐩𝐚𝐧𝐝 𝐁𝐞𝐲𝐨𝐧𝐝 𝐂𝐥𝐢𝐦𝐚𝐭𝐞 (IFRS S1) TCFD = climate only. ISSB S1 = all sustainability-related risks and opportunities that affect enterprise value (e.g. water, biodiversity, human capital, supply chain). ✅ 𝐀𝐝𝐝 𝐏𝐫𝐞𝐬𝐜𝐫𝐢𝐛𝐞𝐝 𝐃𝐢𝐬𝐜𝐥𝐨𝐬𝐮𝐫𝐞 𝐃𝐞𝐭𝐚𝐢𝐥𝐬 TCFD is principles-based; ISSB is prescriptive. Include how sustainability factors affect cash flows, access to finance, and cost of capital. Clearly link ESG risks to financial statements and strategic plans. ✅ Strengthen Data Quality and 𝐀𝐬𝐬𝐮𝐫𝐚𝐧𝐜𝐞 ISSB expects disclosures to be assurable. Engage assurance providers early to assess readiness. ✅ 𝐀𝐝𝐝 𝐒𝐜𝐨𝐩𝐞 𝟑 Disclosure of all Scopes 1, 2, and 3 will soon be required. ✅ Link to 𝐅𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐑𝐞𝐩𝐨𝐫𝐭𝐬 ISSB is designed for inclusion in general-purpose financial reporting. Coordinate with finance teams and align timelines, controls, and governance processes. ❌ Include 𝐈𝐧𝐝𝐮𝐬𝐭𝐫𝐲-𝐬𝐩𝐞𝐜𝐢𝐟𝐢𝐜 𝐌𝐞𝐭𝐫𝐢𝐜𝐬 (𝐒𝐀𝐒𝐁)? Not Necessary The UK is planning to make them optional. Do you think the UK’s move from TCFD to ISSB is helpful? #UK #ESG #ISSB #TCFD

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I found this MSCI Inc.’s publication on Understanding Carbon Markets to be an excellent reference — clear, comprehensive, and highly relevant for anyone serious about navigating carbon markets, ESG, and decarbonization. 🧐 👏 𝗔 𝗳𝗲𝘄 𝗶𝗻𝘀𝗶𝗴𝗵𝘁𝘀 𝘁𝗵𝗮𝘁 𝘀𝘁𝗼𝗼𝗱 𝗼𝘂𝘁 𝗳𝗼𝗿 𝗺𝗲: ▪️ Compliance carbon markets (like ETS) have already reduced global GHG emissions by 4%–15%, proving that pricing carbon works. ▪️ The voluntary carbon market, though smaller, is evolving rapidly—with integrity initiatives like ICVCM’s Core Carbon Principles now raising the bar for quality. ▪️Companies with net-zero pledges—nearly 3,600 of them—are increasingly reliant on high-quality carbon credits to tackle hard-to-abate emissions. ▪️ Criticisms around integrity and greenwashing are real, but new governance, transparency, and disclosure rules are strengthening trust. ▪️ Prices for carbon credits will likely rise significantly as demand accelerates, especially for high-integrity removal credits. 𝗪𝗵𝗼 𝗯𝗲𝗻𝗲𝗳𝗶𝘁𝘀 𝗳𝗿𝗼𝗺 𝘁𝗵𝗶𝘀 𝗱𝗼𝗰𝘂𝗺𝗲𝗻𝘁? 𝗖𝗼𝗿𝗽𝗼𝗿𝗮𝘁𝗲 𝗹𝗲𝗮𝗱𝗲𝗿𝘀:to navigate when, how, and what kind of credits to use in credible net-zero strategies. 𝗜𝗻𝘃𝗲𝘀𝘁𝗼𝗿𝘀:to assess risks, opportunities, and the climate progress of portfolio companies. 𝗣𝗼𝗹𝗶𝗰𝘆𝗺𝗮𝗸𝗲𝗿𝘀 & 𝘀𝘂𝘀𝘁𝗮𝗶𝗻𝗮𝗯𝗶𝗹𝗶𝘁𝘆 𝗽𝗿𝗼𝗳𝗲𝘀𝘀𝗶𝗼𝗻𝗮𝗹𝘀: to sharpen understanding of where markets are headed and how integrity can be safeguarded. For me, the biggest takeaway is this: carbon markets are not a silver bullet, but they are a powerful lever. Used responsibly—with integrity—they can help close the gap between ambition and action. #planetaryhealth #planetaryboundaries #sustainability #ClimateAction #carbonfootprint #NetZero #ClimateEmergency #SDG #ESG #GHG #netzero

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How should sustainability professionals prepare—without burning out? A lot of sustainability professionals I know are carrying two heavy truths at once: 1. The pace of change is nowhere near fast enough. 2. The world around us is increasingly unwilling—or unable—to prioritise sustainability. We’re in a phase of geopolitical fragmentation, economic volatility, and cultural revaluation. The capital isn’t flowing the way it did. Budgets are tightening. Long-term thinking is being deferred in favour of short-term survival. > And yet we know: a 3 degree hotter future is still in play. This is where it gets hard—because the urgency hasn’t gone away. But the political and financial tailwinds have. --- So how do we plan over the next three years? Not just the next framework, fund cycle, or strategy refresh—but the three years ahead of us, with all their contradictions. Here’s what I’m holding: 🔹 Focus on high-impact reduction, not just targets We may not have the capital for everything—but we can still push for emissions reductions where it moves the needle most. Let’s not confuse perfection with impact. 🔹 Plan for a warmer, more volatile reality We can’t afford to build as if 1.5°C is guaranteed. We need to design portfolios, places, and supply chains for volatility—climate, financial, and geopolitical. 🔹 Recognise capital pressure—and work with it Where the capital goes may not align with climate or justice. But we can still design for resilience: unlocking co-benefits, reducing operational risk, and embedding value in context. 🔹 Support each other—professionally and personally The exhaustion is real. So is the grief. We’re going to need new forms of collaboration—inside firms, across sectors, and within ourselves. --- > Sustainability now means preparing for a future that may not support it. So take care of your capacity. Align your work with what can still shift. And speak honestly about what’s no longer viable—so we can focus on what still is. Because adaptiveness may no longer be optional. It’s becoming the foundation of meaningful sustainability. #Sustainability #ClimateAdaptation #CapitalMarkets #Resilience #ClimateStrategy #Finance #LeadingFromTheEdge

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Discuss: “The study tries to isolate the causal impact of CA100+ by examining the coalition’s selection process for its focus companies and comparing targeted companies with a suitable control group. The findings indicate that CA100+ has not significantly influenced climate-related disclosures or immediate reductions in carbon intensity. However, its engagement has led to greater ambition in companies’ medium- and long-term emission reduction targets. Notably, this effect is concentrated among companies selected by investors on a discretionary basis. Surprisingly, the study finds no evidence that the initiative’s scale – measured via collective ownership and assets under management – amplifies impact, nor any spillover effects to non-target firms.” Link in comments.

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This is one of two go-to reports I use to explain the global climate finance landscape. I particularly like the figure on page 4 that shows the relationship between contributors and funds showing the *public* finance flows through some of the major mechanisms. Other key messages include: - The New Climate Finance Goal: At COP29, a new collective quantified goal on climate finance (NCQG) was established, succeeding the previous USD 100 billion annual target. The new goal aims for developed countries to lead in mobilizing at least USD 300 billion per year by 2035 for developing nations' climate action. The broader goal is to scale up total climate financing from all sources to at least USD 1.3 trillion annually by 2035. - Growth of Multilateral Climate Funds: The report highlights a significant planned increase in the role of multilateral climate funds. There's a call to at least triple the annual outflows from key funds like the Green Climate Fund (GCF) and the Global Environment Facility (GEF) by 2030, based on 2022 levels. - Launch of the Fund for Responding to Loss and Damage (FRLD): A major development is the establishment of the FRLD, which became an operating entity of the UNFCCC Financial Mechanism. As of January 2025, it had received USD 741 million in pledges to assist vulnerable countries in responding to the economic and non-economic impacts of climate change. - Challenges in Accessing Finance: Despite the increasing funds, the report underscores persistent challenges for developing countries in accessing climate finance. These include the high cost of capital, burdensome application processes, and co-financing requirements. The NCQG decision specifically calls for simplifying access and deploying more non-debt-inducing financial instruments. - Increasing Complexity and the Need for Coordination: The global climate finance architecture is becoming more complex, with a multitude of multilateral, bilateral, regional, and national funds and channels. ♻️ Share this informative overview with your network if you believe it can benefit others.

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