Trend one: sustainability that pays

Asia-Pacific (APAC) is strengthening its role in shaping the global sustainability agenda. A June 2026 survey revealed that 62% of sustainability professionals expect the region’s influence to grow over the next three years. This momentum is supported by sustained investment; 87% of C-suite executives in APAC reported increasing sustainability investments over the previous year, which exceeds the global average of 82%.

The region is also leading in the adoption of International Sustainability Standards Board (ISSB) standards. Currently, 19 jurisdictions have climate-related financial disclosure regulations, with 13 having either adopted ISSB-aligned requirements or issued exposure drafts. APAC’s 15% ISSB disclosure rate among companies is the second highest globally, following Europe at 19%. Australia has implemented a compulsory reporting regime where 259 companies filed climate risk reports in 2025, primarily across the mining, construction, materials, and financial services sectors. Furthermore, Asia was the fastest-growing region for Science Based Targets initiative (SBTi)-aligned target-setting in 2025, experiencing a 53% increase compared to 40% globally.

Capital flows are reinforcing this position, with APAC energy transition investment reaching $1.1 trillion in 2025, accounting for 47% of the global total. Carbon markets are also expanding, with 71% of all global emissions in the East Asia Pacific covered by an emissions trading system or carbon tax, compared to 15% in Europe and Central Asia. Organisations are advised to track these capital flows to identify growth options and anticipate market shifts, as the financial case for decarbonisation deepens.

Trend two: energy conundrums

Clean energy deployment is accelerating across APAC, significantly impacting the global energy transition. In 2025, China accounted for over 60% of global capacity additions, while India experienced capacity growth of almost 60% year-on-year. This acceleration contributed to a 0.2% decline in global fossil fuel generation, marking the first year this century that fossil generation dropped in both countries (falling 0.9% in China and 3.3% in India).

Governments continue to raise ambitions. India has approved a 2035 target to source 60% of power from non-fossil sources, and China plans to obtain half of its power from non-fossil sources by 2030. Singapore also raised its 2030 solar deployment target to 3 GWp. The region is the world’s largest electric vehicle (EV) market; in China, EVs represented 53% of all new car sales in 2025, while sales in Southeast Asia doubled.

However, energy security remains a strategic priority due to geopolitical tensions. Before the conflict in Iran began in February, Asia received approximately 80% of its oil and 90% of the LNG transported through the Strait of Hormuz. These vulnerabilities have prompted some renewed interest in coal; Thailand ordered the restart of coal-fired units and Vietnam is considering coal-fired capacity additions. Companies are encouraged to diversify their energy portfolios through a mix of renewables and domestic sourcing to increase resilience to market volatility.

Trend three: sustainability in digital era

APAC is emerging as a global centre for AI adoption, with Chinese models capturing 48% of global AI traffic on the OpenRouter API platform in June 2026. Workplace adoption is also leading globally, with 78% of APAC employees using generative AI at least weekly, compared to 72% globally. Data centre investment in the region reached a record $11.6 billion in 2025, led by the Malaysian state of Johor, which saw a 53% year-on-year rise in live capacity.

This growth faces physical and social limits. In the Tokyo region, a 10 GW data centre project pipeline is more than double the region’s expected power supply expansion. Water stress is also a critical risk; an estimated 40% of assessed data centres in a 2025 study will face medium-high to extremely high water stress by 2030, rising to 100% by 2050. Consequently, governments are introducing stricter rules. Australia plans to require AI data centre developers to underwrite new electricity generation and fund water infrastructure, while Malaysia restricted non-AI data centre growth for two years from February 2026 to reduce pressure on the grid.

Trend four: EHS transformation

Environmental, Health, and Safety (EHS) regulations are evolving towards proactive, data-driven risk management. South Korea amended its Occupational Safety and Health Act in February 2026 to require disclosure of safety management systems and accident records, with fines of up to $7,000 for non-compliance. Psychosocial hazards are now subject to enforceable requirements across every Australian jurisdiction as of December 2025, and Taiwan mandated workplace bullying processes in July 2026.

Organisations are increasingly using technology to manage these risks. Samsung deployed a smartwatch-based safety solution to predict heat stress using real-time biometric data and heatwave thresholds of 33 °C, 35 °C, and 38 °C. BHP uses AI-powered object detection to identify hazards in mines before they reach port systems. Furthermore, new environmental laws are being implemented, including Vietnam’s Law on Chemicals (January 2026) and India’s solid waste management rules based on the ‘Polluter Pays’ principle. Companies are advised to evaluate environmental compliance from the start of project development to avoid permitting delays and costly redesigns.