Beyond Europe: How Global ESG Frameworks Are Starting to Converge

Over the past decade, ESG regulations have exploded across jurisdictions—each one introducing its own rules, metrics, and acronyms. For global fund managers, the result has often been a maze of reporting obligations: SFDR and the EU Taxonomy in Europe, climate disclosures from the SEC in the U.S., ISSB’s standards globally, and regional frameworks developing across APAC.

But there’s good news: a convergence is underway.

What does this mean? Well to start, frameworks like ISSB, CSRD/ESRS, and SEC climate rules are beginning to overlap—not just in language, but in substance. This alignment is reshaping how asset managers, data providers, and regulators interpret ESG information, and how they prepare for disclosures across multiple markets.

In this blog, we’ll explore how this convergence is unfolding, what it means for the future of sustainable finance, and what financial institutions should do to prepare.

The Current Patchwork

To understand convergence, it’s helpful to first map the current regulatory terrain.

Each framework varies in its scope, materiality definition, and level of prescriptiveness. For instance, the EU’s CSRD mandates double materiality (financial and impact), while ISSB focuses on financial materiality aligned with investor needs.

Ascertaining harmony has previously been difficult until recently, where several forces are pushing the frameworks closer together.

Signs of Convergence

ISSB + ESRS Interoperability

In 2024, EFRAG (which develops the ESRS) and the ISSB released a joint interoperability guide. It outlines how companies can use a “building blocks” approach: disclose under ESRS while also satisfying ISSB’s climate disclosure requirements.

ISSB Becoming a Global Baseline

The ISSB Standards (IFRS S1 and S2) are built on TCFD and SASB foundations. They're quickly becoming a global reporting baseline, endorsed by:

• The G7 and G20 finance ministers
  
  
• IOSCO
  
  
• Financial regulators in Singapore, Japan, Brazil, and South Africa

This helps multinational companies use one core set of disclosures and adapt for local add-ons (like SFDR or ESRS).

APAC Alignment

In Asia, several markets are referencing or adapting global frameworks:

• Singapore MAS will require climate reporting aligned with ISSB from 2025
  
  
• Japan’s Financial Services Agency (FSA) is also aligning its code with ISSB
  
  
• Malaysia and Indonesia have announced ISSB-based roadmap plans
  
  

Even China’s Green Taxonomy, while distinct, shares structural similarities with the EU Taxonomy in terms of technical screening criteria.

‍From TCFD to Global Convergence

To understand how we reached this new phase of ESG alignment, it’s helpful to look back at the evolution of sustainability standards over time:

What This Means for Fund Managers

For asset managers operating across borders, convergence means both opportunity and complexity. On one hand, you can reduce duplication and build consistent reporting pipelines. On the other, it’s vital to track where frameworks align—and where they still diverge.

Benefits:

• Comparable climate disclosures across regions
  

• More reliable ESG data pipelines, especially as CSRD kicks in

• Easier due diligence for international portfolios

Challenges:

How to Prepare

A framework-agnostic strategy is now essential. That means preparing your ESG data infrastructure to handle:

• Cross-standard mapping (e.g. ISSB <--> ESRS indicators)
  
  
• Structured data and digital taxonomies, like XBRL-tagged sustainability reports
  
  
• Granular, entity-level data that can feed both SFDR reporting and broader global disclosure needs (Click here to learn more about how to simplify your SFDR reporting)
  

Practical Tips:

• Track national regulators’ ISSB adoption roadmaps (see ISSB adoption tracker)
  
  
• Invest in ESG tools that support multiple standards (ESRS, ISSB, SFDR)
  
  
• Educate reporting teams on materiality distinctions and data tagging requirements
  
  
• Use modular data pipelines: gather once, report many ways
  ‍

As the CSRD data stream begins flowing in 2025, asset managers will increasingly rely on corporate disclosures that are both ESRS-compliant and ISSB-compatible.

Conclusion

For years, ESG reporting has been siloed by geography. But we’re now entering a new era: interoperability, comparability, and consolidation. While convergence is still imperfect, the building blocks are now in place—and early movers will benefit most.

To stay ahead, fund managers should move toward framework-agnostic reporting workflows, embrace structured ESG data, and prepare to leverage aligned disclosures across borders.

At Datia, we’re committed to helping financial institutions and corporates navigate regulatory complexity while maintaining data quality and compliance confidence. Whether rules expand or simplify, our platform evolves with you.

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