Accelerating The Transition To Net Zero: Insights And Recommendations From G20 Regulations

Regulations are necessary to accelerate the transition to net zero, convert voluntary commitments into rules for the economy, and level the playing field for companies. To address this critical need, we conducted a mapping of national-level climate regulations across the G20, covering four regulatory domains – (1) climate-related claims and financial product standards, (2) disclosure of climate-related risks, (3) decarbonization- focused procurement regulations and (4) transition plan requirements. Our findings reveal widespread adoption of regulations, with the majority (16) of G20 members, developed and developing nations, having implemented regulations in at least one tracked domain. While progress is evident, comprehensive regulation remains elusive, as no G20 member has yet regulated in all four of the covered domains. We recommend G20 countries make full use of regulatory tools available to drive corporate and governmental climate action, transparency, and accountability, by implementing regulations around disclosure, transition plans, claims, and procurement. Our research also highlights that the advocated shift from voluntary standards to their incorporation into mandatory national regulations is underway, particularly for reporting – through disclosure of climate risks and transition plans. We recommend G20 regulators incorporate best practices from voluntary standards into regulations, promoting consistency across the private and public sectors and expediting the regulatory design and implementation process. The G20 is uniquely placed to scale up and champion best practices in net zero regulation and promote global alignment on the necessary regulatory instruments to meet net zero by 2050. The global community can build from the existing regulations, as well as the growing momentum around them, to advance the regulatory framework that can support the transition to net zero.