Follow the Money: Sustainability Moves into Finance Function

For many companies, sustainability has been relegated to its own department — adjacent to the business but rarely embedded in the financial decisions that drive it. That’s changing. Across industries and geographies, sustainability strategy is increasingly being owned, measured, and funded by finance teams. This issue of G&A’s Sustainability Highlights is full of news that demonstrates that shift. The latest developments gathered here also reveal a gap that remains between finance and sustainability: operational readiness for climate change.

We found a vivid example in the apparel sector, with clues for the future of other industries with complex supply chains. As reported by Global Fashion Agenda and Fashion Network, fashion brands are moving sustainability out of marketing departments and into the CFO’s office. Sustainability is becoming a core responsibility for finance directors, as more companies make them responsible for embedding sustainability into financial planning, capital allocation, and supplier contracts.

According to the new reporting, this is because economics demand it. Rising material costs, tightening EU regulations, and shifting consumer expectations are making sustainability a profit and loss (P&L) issue. The fashion industry may be out front on this, but the pattern applies well beyond apparel — any industry with a complex supply chain and regulatory exposure is heading in the same direction.

The scale of sustainability’s shift into finance is quantifiable. PR Newswire reports that EcoVadis currently covers US$2.5 trillion in global procurement spend through its sustainability risk insights platform. In other words, as companies shift from compliance-driven supplier assessments to resilience-led procurement strategies, trillions in purchasing decisions are being filtered through sustainability risk data.

In another development explored below, the financial architecture around carbon is expanding rapidly. ESG Today reports on an international carbon pricing coalition recently launched by China, the EU, and Brazil — three of the world’s largest economies – formalizing cooperation on carbon markets following negotiations at the 2025 UN Climate Change Conference in Brazil. This development builds on one highlighted in our last issue: ICAP data shows 41 active emissions trading systems covering 63% of global GDP. For companies operating across these jurisdictions, carbon is becoming a material financial input.

G&A’s team has published new resources on this evolving landscape, including explainers on the EU’s CBAM and carbon pricing mechanics and a blog on proposed updates to the Greenhouse Gas Protocol, located in the G&A Blog/Research section below.

Amid this momentum, where do gaps remain? Sustainability Magazine covers new CDP analysis showing that many companies are still failing to adequately prepare for extreme weather risk — even those that report through CDP. The disconnect between financial commitment to sustainability and operational readiness for climate impacts remains one of the biggest vulnerabilities in corporate risk management. For companies working through their 2026 CDP response, this is a timely reminder that disclosure without action leaves value on the table. Learn more about G&A’s CDP response support here.

For professionals navigating the broader landscape, this issue also covers NATO backing renewables for energy security, ESG investments on track to hit US $186 trillion by 2035, California’s EPR law facing a potential legal challenge, new EU CBAM rules allowing capped carbon credit deductions, and the UK’s sustainability reporting standards — which G&A also explores in a new blog this week.