Taiwan plans to ease corporate sustainability reporting requirements and introduce anti-greenwashing guidelines by the end of 2026, as authorities seek to reduce compliance costs while maintaining progress towards net zero emissions, the environment ministry said on Thursday.
The measures come as the island responds to concerns from businesses over rising reporting burdens and follows moves in Europe to simplify sustainability disclosure requirements under the European Union’s Omnibus I package.
The Ministry of Environment and Taiwan’s Financial Supervisory Commission (FSC) are coordinating efforts to harmonise carbon accounting rules and develop local emissions factors for indirect, or Scope 3, greenhouse gas emissions, aiming to reduce duplicated work and lower compliance costs for companies.
“Net zero emissions by 2050 must be advanced pragmatically,” the ministry said in a statement, adding that the government would continue improving carbon accounting infrastructure while using financial incentives to encourage emissions reductions.
Under Taiwan’s sustainability disclosure roadmap, the FSC announced late last year that the largest listed companies would adopt the International Financial Reporting Standards (IFRS) Sustainability Disclosure Standards in three phases.
The third phase, covering listed firms with paid-in capital below NT$5 billion (US$169 million), will begin applying the standards from 2028, with reporting starting in 2029.
To give companies greater flexibility, disclosure of Scope 3 emissions — which cover indirect emissions across a company’s value chain — will only become mandatory from the fourth fiscal year after firms begin applying the standards. For third-phase companies, this means Scope 3 data for 2031 would be disclosed in 2032.
Neither the IFRS standards nor current requirements from the FSC and environment ministry require Scope 3 emissions data to obtain third-party assurance, a move authorities said would significantly reduce initial compliance costs.
The FSC is also surveying smaller listed firms to assess whether some sustainability disclosure requirements could be simplified, delayed or exempted, including non-climate-related information and Scope 3 emissions reporting, in line with international trends.
Businesses have long complained about overlapping reporting requirements from different local regulators.
To address this, the FSC will allow companies to directly use verified Scope 1 and Scope 2 emissions data already submitted to the environment ministry. The commission has also aligned reporting deadlines by extending the deadline for assurance of Scope 1 and 2 emissions data to the end of October each year.
The environment ministry said it would work with the Ministry of Economic Affairs and the FSC to gradually develop Taiwan-specific Scope 3 emissions factors, which companies use to estimate indirect emissions throughout their supply chains.
The semiconductor and electronic components manufacturing sectors will be prioritised because of their importance to Taiwan’s exports and growing demand from global supply chains for more detailed carbon accounting data.
Anti-greenwashing rules
Separately, the ministry said it would draft guidelines on the use of sustainability awards and environmental labels, citing growing concerns that some companies were exaggerating environmental achievements or relying on questionable environmental, social and governance (ESG) awards and certifications.
The proposed anti-greenwashing guidance will draw on regulatory developments in Europe and the United States, including restrictions on unverified labels, requirements to disclose potential conflicts of interest in sustainability rankings and the need for evidence-backed environmental claims.
The ministry said the guidelines would focus on how companies use sustainability awards and labels in advertising, reports and product marketing.
Claims would need to comply with three core principles: they must be truthful and valid, proportionate to the scope of achievements, and free from vague or misleading language.
Organisations that issue sustainability ratings or awards would also be encouraged to disclose assessment criteria, reveal any commercial relationships with evaluated companies and consider significant environmental or regulatory violations when conducting assessments.
Taiwan has already taken initial steps to address greenwashing in the financial sector. The FSC issued anti-greenwashing guidelines for financial institutions in 2024, requiring sustainability-related claims to be evidence-based, clear and not misleading. However, the guidelines apply only to financial institutions and do not specifically regulate the use of sustainability awards and labels across the wider corporate sector.
