ESG+ Newsletter – 02 April 2026
In this week’s newsletter, recent developments point to a rapidly shifting ESG landscape shaped by changing consumer priorities, evolving regulation, and rising expectations around corporate oversight. From increased uptake of electric vehicles as higher petrol prices influence buying behaviour, to mounting legal disputes over ESG shareholder proposals in the US, tensions between investors and corporates continue to linger. Meanwhile, the EU’s Carbon Border Adjustment Mechanism is beginning to influence industrial competitiveness and climate strategy, while new research reveals a disconnect between companies’ AI ambitions and the governance structures needed to support them. |
This week’s poll
Would rising petrol prices make you more likely to consider purchasing an EV? |
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Last week’s poll
Consumers turn to EVs as petrol prices rise
As petrol prices have continued to dramatically rise, Reuters reports that the boost in EV sales across Europe is an early sign that rising fuel prices is having a material impact at a consumer level. French online used-car retailer Aramisauto, for example, saw its share of EV sales almost double from the week starting February 16 to the week starting March 9, rising to 12.7% from 6.5%. Over the same three weeks, petrol models on Aramisauto fell to 28% of sales from 34%, while diesels dropped to 10% from 14%. The shift away from combustion engines toward EVs mirrors a trend observed in 2022 when Russia invaded Ukraine. This shift is also observed across Europe’s used-EV landscape, which has broadened its range of models, supporting sales even before the war began. Data shows a “clear and sustained escalation” in used EVs sales since the war began, according to British automotive data firm Marketcheck, and serve as a strong metric of shifts in sentiment or sharp moves in petrol prices, because they are up to 40% cheaper than new models and readily available to drive off the lot, unlike new cars that often take months to deliver.
Lawsuits over ESG shareholder proposals face corporate pushback
Investors are filing lawsuits in an attempt to force companies to include ESG-related shareholder proposals on annual meeting ballots, as reported by Bloomberg Law. These cases are initiated by shareholders and investor advocacy groups, including As You Sow and the New York State Common Retirement Fund, which have fought companies at the SEC for years to offer ESG proposals surrounding climate change and environmental risks. These groups argue that blocking ESG proposals weakens shareholder rights and oversight of material risks. The lawsuits follow a November 2025 SEC policy change under Chairman Paul Atkins that reduced the agency’s role in mediating proposal disputes, giving executives more discretion to preclude shareholder proposals on proxies. Companies are facing lawsuits seeking ESG disclosures, including on climate risk and deforestation. It is up to the courts to determine how broadly companies can use SEC rules allowing the exclusion of proposals tied to ordinary business operations. The lawsuits reflect a heightening governance battleground over shareholder rights, ESG transparency, and corporate accountability. |
CBAM could be pivotal in accelerating the green transition
The EU Carbon Border Adjustment Mechanism (CBAM) could play a significant role in determining the rules and status quo surrounding clean industry in the EU, Sustainable Views reports. CBAM, which came into effect at the beginning of 2026, implements a tariff on imports in high-polluting industries that are produced outside the EU and imported into the bloc. In theory, enabling domestic producers, to gain a competitive advantage over lower cost imports with higher embed carbon emissions. The industry that CBAM will have the biggest impact on is steel, an industry that is responsible for 8% of global emissions. CBAM, at its best, ties emissions to the competitiveness of a product, embedding the carbon cost of production directly into market considerations. While the theoretical approach of the regulation is straightforward, its practical application remains more complex. Global competitors, particularly China, are rapidly scaling low-emission production capacity. This creates a pressing need for European industries, including steel, to accelerate their transition in order to remain competitive under the very framework designed to protect them. At the same time, the policy raises difficult political and economic questions. If imports are subject to carbon-adjusted costs while domestic producers continue to receive transitional support, CBAM risks being perceived by some as protectionist rather than purely climate-driven. However, handled well, CBAM has the potential to normalise the idea that environmental cost should be embedded in how competitive a product is allowed to be within a regulated market, an approach that could prove pivotal in advancing the global green transition. |
New research identifies gap between AI ambition and governance
Research from the AI Company Data Initiative (AICDI), reported by PA Future, highlights a lack of board-level oversight of artificial intelligence (AI) and points to a widening gap between AI ambitions and governance frameworks.
The AICDI report, Responsible AI in Practice: 2025 Global Insights, analyses data from almost 3,000 companies across 11 sectors globally. Although 40% of companies report board- or committee-level oversight of AI, fewer than a third (31%) disclose a dedicated team or resource responsible for AI governance. Among other notable findings, just 13% publicly commit to a recognised AI governance framework or standard, suggesting limited alignment with emerging norms and best practice. Only 31% disclose offering AI-related training or reskilling to employees, while just 12% report having policies in place to ensure human oversight of AI systems.
The report suggests governance weaknesses may result in “unpriced risk” in investor portfolios, with investors expected to apply closer scrutiny to AI governance during the proxy voting season. In recent years, investors have been developing their own frameworks to assess portfolio companies’ responsible AI practices. Beyond visible shareholder proposals in the US, AI governance has also become an important topic in behind-the-scenes investor–company engagement.
ICYMI
Australia has moved to operationalise its national sustainable finance framework, releasing guidance designed to bring its taxonomy into active use across debt markets and accelerate capital flows into climate-aligned sectors, ESG News reports.
In response to California’s new packaging rules set to take effect in 2026, which include stricter standards on what can be labelled as recyclable, a group of businesses has filed a lawsuit challenging the regulation, arguing that it limits free speech and imposes additional burdens.
The Global Reporting Initiative (GRI) announced the release of a series of new exposure drafts aimed at expanding and strengthening corporate reporting on pollution impacts and management, according to ESG Today.
| The views expressed in this article are those of the author(s) and not necessarily the views of FTI Consulting, its management, its subsidiaries, its affiliates, or its other professionals.
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