ESG in 2026: The 5 things you need to get right
ESG is noisy right now. Not because it is going away, but because it is growing up. The expectations are sharpening. The commercial stakes are rising. And the work is moving from sustainability teams into finance, risk, procurement, operations and the boardroom. Here we unpack the five priorities shaping ESG in 2026, and the moves organisations can make now to stay ahead. Economic Essentials The economic case has shifted. The question leaders are asking is no longer what is the cost of transition. It is what is the cost of delay. Deloitte Access Economics modelling shows that transitioning to net zero by 2050 adds $435 billion to Australia’s GDP^. The same modelling cites a $370 billion GDP boost under a 75% emissions reduction target by 2035, with Australia $500 billion better off by 2050. Then there is the capital signal. Responsible investment and sustainable finance are scaling quickly. Current estimates are that the sustainable finance market was about USD 754 billion in 2024 and could reach about USD 2.59 trillion by 2030*, with around 23% annual growth through 2030. What it means is simple. Capital is increasingly pricing performance, not promises. What to do now Regulation Rising Mandatory reporting is not just more work. It is a reset of accountability. Sustainability reporting is already mainstream for the world’s largest companies, with 96% of the G250 reporting, and more than 300 new global regulations introduced since 2019. The direction of travel is clear, even as some jurisdictions adjust timelines and scope. In Australia, mandatory climate reporting under the Corporations Act commenced from 1 January 2025 for the largest organisations, with a phased rollout beginning with $500 million plus entities as the first cohort. The hardest part is not finding the data. It is building governance and capability so disclosures are credible, consistent and ready for assurance. What to do now Systemic Synthesis Fragmented ESG activity will not survive 2026. Systems will. Only 6% of businesses have full traceability in their supply chains. That means most organisations still do not have clear visibility into what is happening at the start of their value chain. At the same time, procurement is tightening. 81% of global trade professionals now use ESG criteria as a primary filter when selecting suppliers. ESG data is becoming a gatekeeper for revenue. This is why the concept of systemic synthesis matters. Instead of collecting ESG data in fragments for different demands, organisations need to stitch it into a single intelligence system that can serve multiple needs across reporting, due diligence, procurement, customer transparency and innovation. Digital Product Passports are one clear example of where this is heading. They have been scheduled to become mandatory in the EU for batteries and textiles from 2027, moving provenance from static documentation to machine readable cradle to grave transparency. They also open circular opportunities like resale authentication, repair enablement and even royalties on second hand transactions. What to do now Value Velocity This is where ESG flips from defence to growth. 2026 is a tipping point where ESG must move from cost of compliance to a rapid driver of value. Market leaders are using sustainability as a performance engine, strengthening enterprise value, winning procurement, and building trust that translates into commercial momentum. Governance maturity is part of the valuation signal now. Recent evidence proves that two thirds of dealmakers pay premiums~ for strong ESG governance, with valuation uplifts of up to 10% when governance resilience can be proven. This is why we challenge teams to do more than report. We want ESG to be embedded and bankable, and we want it to show up in how the business is run. What to do now Transformative Tech AI can be a strategic enabler for ESG. It can process large datasets, support real time monitoring, and make Scope 3 work more manageable. It can also free teams from retrospective reporting so they can spend more time on strategy and transformation. But AI only helps if governance leads. Setting up the guardrails that matter most: accuracy, data ethics and ownership, bias, auditability, and the energy-consumption realities of advanced technology in the context of decarbonisation goals. The opportunity is real. The risk is also real. The organisations that lead will treat AI as part of ESG governance, not separate from it. What to do now Capability is the multiplier ESG training is still fragmented, especially for people outside finance. If you want ESG to stick, build capability across finance, procurement, operations, marketing and sales, not only within the sustainability team. If 2026 is the year ESG becomes normal business, the work is not doing more. It is doing it smarter, with stronger governance, better systems, and clearer value. Contact us to find out what this might look like for your organisation.
Case Study: Refuture Foundation
About SCRGroup / Refuture Foundation SCRgroup is a leader in the recovery of unwanted clothing, diverting clothing from landfill and giving garments a second life in local and global communities. Every day, SCRgroup collects a kilogram of unwanted clothing across Australia. They are a certified B Corp and partner with organisations that create jobs and strengthen communities. This includes employment pathways through Australian Disability Enterprises and support for charities such as Lifeline and The Smith Family. Giving back is built into how SCRgroup operates. The Challenge In late 2023, SCRgroup visited Ghana and Kenya to understand on the ground outcomes of secondhand clothing flows. They saw thriving micro businesses supported by the trade, alongside the reality of garments arriving that cannot be sold and end up as waste. The experience highlighted a critical issue: meaningful change requires transparency and responsible practices across every step of the supply chain, from shipping and sorting through to trading and end-of-life outcomes. At the same time, SCRgroup set out to build a Foundation to deliver measurable social impact. The challenge was turning that ambition into a clear strategy, a strong identity, and an operating model built for real outcomes. The Approach The approach involved identifying the priority initiatives that could accelerate growth for the Foundation with strategic planning being the first step. Together we focused on where Refuture could make the biggest difference across international development support, education, advocacy, and thought leadership. Once the strategic plan and roadmap were in place, we turned to the brand. We developed a distinctive brand so that the Foundation could build trust with stakeholders and connect respectfully with communities. The Deliverables The Results Refuture Foundation launched in 2024 with a clear roadmap and a distinctive identity to advance ethical and transparent practices in the global secondhand clothing trade. The Foundation has delivered six projects focused on reducing textile waste and strengthening social and economic outcomes for communities most affected by the trade. Early impact includes US$7,800 to expand The Revival Studio’s upcycling work in Accra’s Kantamanto Market and A$10,000 in crisis relief following the January 2024 fire, supporting market workers and women traders. By backing initiatives like Africa Collects Textiles and broader research into global secondhand clothing flows, Refuture Foundation continues to strengthen fairer trade systems and scale its positive environmental and social outcomes.
Elevate Your ESG Performance with a Best-Practice Materiality Assessment
Materiality Assessments (MAT) are crucial for navigating the intricate landscape of sustainability and corporate responsibility. By analysing impact and prioritising critical issues around environmental, social, and governance (ESG), you can enhance your organisation’s reputation, increase stakeholder relations, improve financial performance and create long-term value. MATs also identify and manage risk, as hearing directly from stakeholders delivers nuanced details and often surprises. Making data-based decisions can avoid costly mistakes when relying on unverified assumptions and gut feelings. As the Australian business environment evolves, integrating Materiality Assessments into corporate strategies will be crucial in shaping a more sustainable and prosperous future. Internationally, as ISSB reporting rolls around the world in those countries that opt-in, regulatory reporting standards will require quality data to back decisions, targets and progress claims. The bank of data from a comprehensive Materiality Assessment is also vital when making investment trade-offs. It provides confidence in trade-off decisions based on information, not opinion. The same is true for target setting. You need data-based targets geared to achieve real-world impact. This requires a baseline and trend information. By focusing on what matters most to your stakeholders, you can align your sustainability efforts with your overall strategy to become a sustainable and responsible business practice leader. The key benefits of Materiality Assessments Regulatory compliance and risk mitigation: Australia’s regulatory landscape increasingly emphasises environmental and social responsibility. Conduct a Materiality Assessment to help identify and address potential compliance risks related to changing regulations. Proactively managing ESG issues can help you to mitigate risks, avoid legal challenges, and stay ahead of evolving regulatory requirements. Improved financial performance: Materiality Assessments enable businesses to focus on ESG issues that directly impact financial performance. Organisations can address material risks and opportunities to enhance operational efficiency, reduce costs, and identify new revenue streams associated with sustainability initiatives. This approach aligns financial success with responsible business practices to create a win-win scenario. Strong materiality assessments also demonstrate a commitment to responsible corporate governance and transparency. This fosters trust and confidence among investors, potentially leading to improved access to capital and a higher valuation for the company. Competitive advantage: In a competitive business landscape, standing out is crucial. By integrating sustainability into your core strategies and operations you can gain a competitive advantage. A Materiality Assessment can help you to differentiate your business by clearly understanding the environmental and social factors that matter most to your stakeholders and embed them into your strategy. Enhanced reputation and stakeholder relations: In Australia’s socially conscious business environment, companies that actively manage and address material ESG issues benefit from enhanced reputation and stakeholder relations. Demonstrating a commitment to responsible business practices can build trust with your customers, investors, and the wider community. Employee engagement and retention: Australia’s workforce increasingly values companies that prioritise sustainability and social responsibility. A Materiality Assessment provides insights into the most critical ESG issues for employees. Addressing these concerns can foster a positive work environment, enhance employee satisfaction, and improve retention rates. Best-Practice Governance: High-quality materiality assessments are crucial for boards and company directors and are strongly tied to their fiduciary duty to act in the best interests of the company and its stakeholders. Organisations like the Australian Institute of Company Directors (AICD) are increasingly encouraging directors to work with management to fully identify their material impacts on stakeholders and take appropriate actions. A clear understanding of what is considered ‘material’ allows directors to prioritise attention and resources on the most critical issues and make more informed decisions on matters like risk resource allocation and strategic initiatives. The Importance of a Double Materiality Assessment Many organisations are still conducting their Materiality Assessments within the confines of a boardroom, without engaging external stakeholders. They are only assessing how sustainability issues, such as climate change regulations, resource scarcity, and changing consumer preferences, can affect the company’s financial performance and long-term value. This is known as Financial or ‘Single’ Materiality and is an Outside-in approach. Following the GRI framework enables organisations to undertake Double Materiality. This means also taking an Inside-out approach, known as Impact Materiality, and focuses on the company’s impact on the environment and society. It considers issues like climate change, pollution, resource depletion, human rights, and labour practices. Double materiality is becoming increasingly important for companies facing pressure from investors, regulators, and stakeholders to address sustainability issues. It provides a structured and more comprehensive approach to identify and prioritise the most relevant topics, leading to more informed decision-making and enhanced stakeholder engagement. Using Global Reporting Initiative (GRI) Standards Framework for Materiality Assessments The Global Reporting Initiative (GRI) Standards are a comprehensive and globally recognised set of guidelines designed to assist organisations in reporting their economic, environmental, and social performance. These standards provide a framework for transparent and credible sustainability reporting, and offer a systematic approach to disclose relevant, reliable, and comparable information. The GRI Standards cover various topics, from governance and ethics to environmental impact and human rights. They provide flexibility to tailor your Materiality Assessment to your specific context while ensuring consistency and comparability across diverse industries and sectors. By adhering to the GRI Standards, you’ll be well placed to meet stakeholders’ expectations and contribute to advancing sustainable business practices. This fosters accountability, and drives positive social and environmental impacts. The framework encourages a stakeholder-inclusive process, which enables you to engage with diverse perspectives to determine the relevance and significance of various topics. GRI’s emphasis on transparency and accountability supports you to enhance sustainability reporting by aligning it with globally recognised standards. This method not only aids in strategic decision-making but also fosters a culture of openness and responsiveness, which ultimately contributes to long-term success and resilience in a rapidly evolving business landscape. The Critical Role of Impact Analysis Impact Analysis is a core aspect of any Materiality Assessment and aims to evaluate the positive and negative impacts of ESG issues across various dimensions, including financial performance, brand reputation, regulatory compliance, and other relevant aspects. Stage 1: Engage with stakeholders As part of an Impact Analysis, you must
What is B Corp? The Revolution Redefining Business Purpose
In an era where the global business landscape is rapidly evolving towards sustainability and purpose, there’s a palpable momentum of companies not just chasing profits, but ardently pursuing a greater good. This commitment to positive change, transparency, and the common good has given rise to the transformative B Corp Certification. Awarded by B Lab, this prestigious recognition celebrates businesses that meet the zenith of social and environmental performance, public transparency, and legal accountability. Feeling inspired? The journey from problem to action is filled with possibility. Let’s dive into the inspiring world of B Corp, understanding its essence and how your business can be a beacon in this exhilarating movement. What is B Corp? B Corp is not just a certification; it’s a revolution. It represents a community of businesses and leaders who are dedicated to using their commercial power to solve social and environmental problems. They are pioneers, innovators, and most importantly, activists. B Corporations are legally required to consider the impact of their decisions on all stakeholders, not just shareholders. This means aligning profitability with a positive societal impact. It’s about balancing purpose and profit, where companies are as committed to doing good as they are to doing well. By becoming a B Corp, businesses join a vibrant community that thrives on collaboration, openness, and relentless pursuit of a better future. They become part of a movement that resonates with consumers, employees, and communities worldwide. What is B Lab? But who orchestrates this intricate dance between purpose and profit? Enter B Lab, the non-profit organisation behind the B Corp Certification. B Lab is the conductor, guiding companies towards a harmonious blend of financial success and social responsibility. Founded in 2006, B Lab’s mission is to transform the global economy into a force for good. They develop the metrics, standards, and tools that companies need to meet the rigorous social and environmental performance required for certification. B Lab believes that businesses should compete not only to be the best in the world but to be the best for the world. They’re not merely an organisation; they’re a catalyst for change, a champion for a more inclusive and sustainable economy. The Transformative Benefits of B Corp Certification What exactly are the benefits of becoming a B Corp? A Seal of Trust and Credibility In an era where consumers are becoming increasingly discerning about the brands they support, the B Corp Certification serves as a seal of trust. It’s a clear indicator that a company isn’t just talking the talk, but is genuinely committed to making a positive impact. This certification can significantly enhance a brand’s reputation, fostering trust and loyalty among consumers who prioritize sustainability and ethical practices. Attracting Like-minded Talent Today’s workforce, especially the younger generation, is actively seeking employers who align with their values. A B Corp Certification signals to potential employees that a company is dedicated to not just profit, but also to people and the planet. This can be a powerful magnet for attracting and retaining top talent who are passionate about making a difference. A Community of Changemakers Becoming a B Corp means joining a global community of like-minded businesses. This network provides a platform for collaboration, sharing best practices, and collectively amplifying the impact. It’s not just about individual success; it’s about coming together to drive systemic change in the business world. Continuous Improvement The B Corp assessment process is rigorous, and maintaining the certification requires periodic re-evaluation. This ensures that companies are always on their toes, continuously striving to improve their social and environmental performance. It’s a journey of constant growth, innovation, and commitment to excellence. A Competitive Edge In a saturated market, differentiation is key. The B Corp Certification provides businesses with a unique selling proposition, setting them apart from competitors. It’s a statement that says, “We’re not just here to do business; we’re here to do good.” And in a world where consumers are increasingly voting with their wallets, this can translate to a significant competitive advantage. Driving Stakeholder Value Traditional businesses often focus solely on shareholder value. In contrast, B Corps recognize the importance of creating value for all stakeholders, including employees, customers, suppliers, the community, and the environment. This holistic approach ensures a more sustainable and inclusive business model, leading to long-term success and resilience. Future-proofing the Business The challenges of the 21st century, from climate change to social inequalities, require businesses to adapt and innovate. B Corps are at the forefront of this change, proactively addressing global challenges and positioning themselves as leaders in the new business paradigm. By aligning with the values of the B Corp movement, companies are better equipped to navigate the uncertainties of the future. Amplifying Brand Story and Purpose Every brand has a story to tell, and the B Corp Certification can amplify that narrative. It’s a testament to a company’s commitment to a greater purpose, resonating with consumers who are eager to support businesses that align with their values. How do I certify as a B Corp? Embarking on the journey to become a B Corp is both an inspiring and a challenging adventure. It’s a roadmap that leads businesses towards becoming leaders in responsible growth. Assessment: Begin by taking the B Impact Assessment (BIA). This comprehensive analysis evaluates your company’s overall social and environmental performance. Improvement: Based on your BIA score, identify areas where your company can make tangible improvements. The process encourages a holistic view of how your business can positively impact society. Verification: B Lab’s rigorous verification process ensures that your practices meet the high standards set for B Corp Certification. It involves thorough reviews, documentation, and even on-site visits. Legal Alignment: Adopt the legal framework that ensures a long-term commitment to stakeholder impact, even through changes in company ownership or management. Certification: Once you have successfully completed the above steps, your business will join the ranks of B Corps, a beacon of hope and a symbol of sustainable, responsible business practices. What is the B Corp BIA? The