2026 Asia Pacific builds a sustainable future

1. Asia Pacific is a critical driver of the global economy. 
From a relatively low base, the region’s growth has been spectacular, and more than four billion people rely on it continuing to improve social mobility and standards of living. Much of that expansion has been powered by cheap fossil fuels, embedded in economies before climate change posed a more serious risk. This places Asia Pacific in a unique position: it is both the world’s largest source of greenhouse gas emissions and the leading region for new clean energy generation.

2. The region remains committed to change despite economic headwinds. 
Tariff wars and geopolitical conflicts have escalated costs, constrained availability and disrupted movement. Yet Asia Pacific is leading the adoption of the ISSB’s global baseline standards on sustainability reporting. More than 80% of ASEAN economies measured by GDP are adopting or plan to adopt the standards. Including China, voluntary now with plans to move towards mandatory implementation, Asia Pacific economies that have adopted or plan to adopt ISSB Standards account for 47% of global GDP. (ACCA workings based on Our World in Data and IMF World Economic Outlook, April 2026)

3. Disclosure is moving from compliance to business value. 
Early progress in jurisdictions where adoption is mandatory suggests disclosures are still viewed through a compliance lens. However, many early adopters have evolved to using sustainability-related insights to drive business value.

4. Decarbonisation needs to accelerate for business and economic resilience. 
Decarbonisation in Asia Pacific is needed not only to reduce greenhouse gas emissions but to strengthen business and economic resilience. Yet funding for energy transition remains inadequate and is in urgent need of change. Financiers are challenged by the poor bankability of projects, an opportunity for finance professionals to contribute their expertise towards solutions that strengthen risk management and improve project execution.

5. Water and heat could be the defining issues of the 21st century. 
If these risks are not addressed, the GDPs of high-income countries could shrink 8% by 2050, while lower-income countries could face declines of 10–15% (Global Commission on the Economics of Water, 2026). Floods alone account for more than half of the 7.2 billion people affected by disasters in Asia Pacific between 1970 and 2024 (UNESCAP, 2025). The Water-Energy-Food-Health Nexus needs to be better understood and managed, and the region needs to move from conventional water risk management to water stewardship.

6. Responsibility for human rights in value chains must be shared. 
Businesses should conduct human rights due diligence to identify and address risks across their value chains – particularly in markets that are major trading partners with the EU, given the requirements of the Corporate Sustainability Reporting Directive (CSRD) and Corporate Sustainability Due Diligence Directive (CSDDD). Preparation needs to begin early. Asia Pacific suppliers should not face risk-shifting, where adverse impacts are driven by unfair purchasing terms and practices by EU buyers.

7. AI needs effective governance to support a sustainable future. 
AI is moving rapidly from development to deployment across Asia Pacific, with its pace and scale accelerating significantly. It has considerable potential to support a more sustainable future, but its water and energy demands can cause great risks. Governments across the region have developed various governance models, but continued focus is still needed.

Asia funds Asia, but not yet at the scale required

Emerging and developing economies need at least US$1.1 trillion annually to address climate mitigation and adaptation needs. Actual investment falls short by about US$800 billion. (IMF, 2024)

And the capital that is raised comes from within: 96% of funds raised in Asia Pacific are from domestic sources, showing very low take-up from international investors. China alone accounts for US$737.3bn of the US$841.1bn raised across East Asia and Pacific in 2024. (Climate Policy Initiative)

This is not only an Asia Pacific problem. If the region funds its future growth from fossil-fuel sources because financing options are limited, the global outlook for warming deteriorates faster.  

• Asia Pacific’s leadership in adopting IFRS Sustainability Disclosure Standards, and how sustainability-related information can drive business value and resilience

• Decarbonisation and energy transition – energy and economic resilience, and financing Asia Pacific’s sustainable future

• Nature as fundamental to protecting and building resilience, with a thematic focus on water and extreme heat

• Business and human rights, including the implications of EU directives for Asia Pacific

• Artificial intelligence – its dual-use nature, impact on the environment, skills in the finance function, and governance

Asia Pacific is not a region waiting to be shown good practice, it is building the architecture of sustainability reporting faster than anywhere else. Adopting a standard is not the same as achieving a strong rate of decarbonisation or addressing other sustainability issues facing the region, but better information enables better decision-making and, at macro level, builds trust in the ecosystem.

The region sits on both sides of the ledger. It carries disproportionate risks created by a worsening climate crisis, but the opportunities are equally enormous – and businesses and policymakers are actively driving a more sustainable future.

Finance leaders and policymakers must still do more: translating insight into action and impact and implementing change across entire systems. Decarbonisation must be pursued not only to reduce emissions, but to build greater resilience against geopolitical disruption and the rising cost of fossil fuels. The accountancy profession can be a major force in building a more sustainable and resilient future for Asia Pacific, and what happens here will shape what happens everywhere else.

To business and finance leaders

• Make decarbonisation, nature risks and impacts a board priority. Embed them into budgets, risk registers and management dashboards

• Use sustainability information for value creation and risk management, not simply compliance. Establish clear ownership and accountability for sustainability-related reporting through a RACI

• Understand and address salient human rights risks across the value chain 

• Strengthen AI governance and pair adoption with structured upskilling and transition plans. Measure and reduce AI’s resource footprint

To policymakers

• Prioritise decarbonisation for energy and economic resilience. Mobilise Asian capital and public sector funding to de-risk projects

• Strengthen the region’s voice on global policymaking and standard-setting

• Improve the availability and accessibility of accurate data, particularly water, and raise cryosphere risks in intergovernmental policy dialogues 

• Promote regional interoperability through an ASEAN or Asia-Pacific AI governance framework

• Align AI growth with energy and climate goals, ensuring water and low-carbon energy investment keeps pace with data centre expansion

• Ensure skills development aligns with AI deployment

• Continue building sustainability reporting capacity through roadmaps, sectoral data, calculation tools, assurance capability and practitioner communities 

• Negotiate with the EU at a national and/or regional level (ASEAN, ASEAN+3) to secure reciprocal labour and human rights chapters, with cost-sharing or technical-assistance obligations attached