H&Z Management Consulting spotlights three ESG focus areas for 2026
2026 will be a decisive year for ESG. With regulatory, customer and investor expectations evolving at high speed, a new white paper from H&Z Management Consulting has highlighted how firms can respond to key trends in each of those three segments.
Research from KPMG in 2023 found that since 2005, the UK had seen carbon emissions in its energy and waste sectors plummet by 64%. Energy excluding electricity had also seen a 46% fall. Those were huge leaps forward in the nation’s sustainability drive – but the Big Four researchers still cautioned that the country faced an uphill battle to reduce emissions on transport, buildings, and industry. Those three sectors made up 60% of all greenhouse emissions in 2022, yet had seen comparatively little progress. At the same time, while 61% of manufacturers were unsure when asked if they could hit their 2030 targets, that industry had only reduced emissions by 36% since 2005.
In 2025, the ESG agenda came under sustained attack. The second presidency of Donald Trump in the US saw the world’s largest economy strip back sustainability initiatives, and criticise those outside its jurisdiction. Meanwhile, investment from the world’s largest sources of funding suddenly began to dwindle – precisely as the road to net zero approaches its most challenging segment.
Now, a new study from H&Z Management Consulting has highlighted three key areas which must be addressed, if businesses, governments and the economy are to get back on track. According to the firm, “companies who act now can turn complexity into clarity, build competitive advantage and shape their ESG agenda proactively.”
ESG data governance
Speaking to more than 1,000 experts from its SUSTAINX community, H&Z found that often, data governance around ESG remained inconsistent and fragmented – with siloed ownership across functions. With many companies still claiming they have no effective overview of their Scope 3 emissions, this simply has to change.
Looking to remedy the situation, H&Z suggests that AI and tool integration may play an important role. However, limited interoperability is restricting scalable data here in a similar way. If firms are to shift away from compliance reporting, toward decision-relevant information, they will need to improve here, and explore new and scalable value streams.
Supply chain decarbonisation
Amid a period of ‘structural volatility’, escalation of geopolitical friction, and increasingly extreme weather resulting from climate change mean global supply chains already find themselves in a period of massive transformation. With business leaders now prioritising investments in back-up plans for when new challenges emerge, 74% recently told Kearney researchers they had started to view resilience as a driver of growth to that end.
According to H&Z, ESG is one area this reslience can emerge from. And while complex data requirements across supply chains may currently stand in the way of this, efficiency on this front breeds resilience: helping to manage cost pressure, supply continuity, and risk across volatile global networks. This business case can increasingly help to secure board-level buy-in for ESG initiatives, then.
Regulatory agility
Even with political pressures pushing back against the ESG agenda, there are still a wave of new regulations to contend with in 2026. Handling these effectively does present an opportunity though – both to boost resilience and efficiency, and to help get a firm to improve its sustainability standing in the public’s eyes.
Among the directives are the EUDR – updating deforestation due diligence for comapnies trading in the EU. In the same region, CBAM will meanwhile implement a carbon tax for EU imports, requiring regular reporting. And PPWR meanwhile will task companies with packaging reduction, recyclability and reuse targets.
“In 2026, ESG success depends on prioritisation of what matters, while ignoring complexity and noise,” H&Z Partner Agnes Erben and Managing Partner Sven Steinert concluded. “The risk is not overcommitting, but failing to act with focus... Secure core business performance, and selectively use ESG where it improves cost position, resilience or customer relevance.”
