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Retail Sustainability Horizon Scan: Regulation, Reporting and Policy Trends – 2026 & Beyond

Briefing

Retail Sustainability Horizon Scan: Regulation, Reporting and Policy Trends – 2026 & Beyond

This briefing recaps and expands on our horizon scan of regulation, reporting, and policy trends, with an overview of top regulatory and reporting priorities for 2026 as well as a look at the emerging policy trends looking to shape retail sustainability as we head toward 2030.

03 February 202632 Minute Read

Naomi Brandon-BravoSustainability Policy Adviser | BRCnaomi.brandon-bravo@brc.org.uk

Sophie De SalisSustainability Policy Adviser | BRCsophie.desalis@brc.org.uk

Tracey BanksClimate Action Programme Manager | BRCtracey.banks@brc.org.uk

Lou SherryPolicy Executive - Sustainability | BRClouise.sherry@brc.org.uk

This month, we hosted the BRC’s 2026 Sustainability Horizon Scan.

This briefing recaps and expands on our horizon scan of regulation, reporting, and policy trends with a deep-dive into:

2026 priorities: upcoming regulatory developments and reporting requirements that retailers should have at the top of the priority list for 2026, and what you need to do.
Forward look: emerging policy trends looking to shape retail sustainability beyond 2026, with suggestions to help you to get ahead of the curve.
BRC support: what we’re doing to support our members understand and prepare.

This builds on the BRC’s 2026 Regulatory Watch-outs, a high-level summary of various UK Government activity for 2026 across our three priorities of Sustainability, People, and Growth.

Please note this briefing will be updated annually, with timelines inevitably changing and other areas potentially emerging as the year progresses.

Subscribe to the Sustainability Community to receive relevant updates here, and contact Lou with any queries. BRC contacts for specific focus areas are listed below.

Use the panel below to navigate to the horizon scan for your focus area:

Circular Economy: Packaging

2026 Priorities

Focus Area	What?	What To Do	BRC Support
Extended Producer Responsibility for Packaging (pEPR)	March: PRO due to be appointed July: Year 2 producer invoices will be modulated, reflecting the level of recyclability within each material category for the first time	Prepare for producer invoices by reporting Jul – Dec 2025 data, including Recyclability Assessment Methodology data by 1 April 2026	Contact Naomi to join the pEPR mailing list
Deposit Return Scheme (DRS) for UK and Wales	April: Deposit Management Organisation (DMO) to publish final scheme design, including crucial elements such as exemption criteria and retailer handling fee	Prepare to meet obligations as a return point operator and/or drink producer for DRS go-live in October 2027 Understand and manage potential differences in DRS obligations for Wales vs the rest of the UK.	Contact Naomi to join the DRS mailing list Stay up to date on the latest developments by reading our regular briefings published here.
Plastic Packaging Tax (PPT)	Autumn/Winter: Regulations laid to introduce a mass balance approach for the purposes of permitting chemically recycled plastic under the PPT	Understand what the introduction of chemically recycled plastic may mean for your business’s PPT compliance processes.	Contact Naomi to join the Packaging mailing list Read the latest update on the PPT, including timeframes and next steps for how HMRC will support business readiness

Forward-look

Focus Area	What?	What To Do	BRC Support
Reusable & refillable packaging	The industry momentum towards reusable and refillable packaging is evident, following successful pilots and clear research on the commercial and environmental benefits, as well as a growing regulatory focus on reuse (i.e. pEPR, Welsh DRS)	Explore how to integrate reuse principles into your packaging portfolio and supply chain, working with brands and other retailers to operationalise at scale Prepare for the Defra call for evidence on reuse in grocery retail and on-trade contexts – expected Q1 2026	Contact Naomi to join the reuse mailing list Recap on our event on Reuse in Retail Watch out for the BRC’s Reuse Principles and engagement with the Defra call for evidence in Q1 2026
EU Packaging & Packaging Waste Regulation (PPWR)	The PPWR will significantly alter how packaging is produced, used, distributed, and disposed in the EU. In 2025, the EU announced, and Defra confirmed, the market-access related provisions that are due to apply in NI. Defra are working with the EU on PPWR alignment and will confirm next steps for the UK in due course.	If you operate on the NI market, your business will need to prepare its packaging portfolio for the range of new design specifications. These will include requirements for on-pack labelling, material recycling, minimum recycled content, packaging minimisation, and single-use packaging formats. These requirements will begin to be enforced in the EU from 2027 – 2030. If you do not operate in NI, prepare for UK alignment with certain PPWR provisions e.g. UK on-pack labelling requirements are on hold in order to align with EU requirements when confirmed.	Contact Naomi to join the Packaging mailing list for future updates on PPWR in respect of NI Read our briefing on the provisions confirmed to apply to the UK in respect of NI
UK Emissions Trading Scheme (ETS) expansion to waste sector	From 2028, UK ETS is set to expand to the waste sector to drive the sector’s decarbonisation alongside its transition to a circular economy. UK ETS costs for the incineration of household packaging waste materials will be passed back to producers. Government officials have noted that pEPR base fees are likely to increase to factor in ETS.	Await clarification from Government on the impact of this development on pEPR fees. Await further policy details and timeframes in the full authority response and impact assessment. Prepare to respond to expected Defra consultation, to ensure the right data is available to effectively account for ETS costs while delivering the pEPR policy objectives.	Contact Naomi to join the Packaging mailing list Read our briefing on the UK ETS and the circular economy

Circular Economy: Textiles, Agri-food & Electricals

2026 Priorities

Focus Area	What?	What To Do	BRC Support
Extended Producer Responsibility for Textiles (tEPR)	Q1 2026: tEPR is expected to feature in Defra’s Circular Economy Growth Plan, as part of a roadmap for the textiles sector.	Understand what a tEPR scheme may mean for your business Prepare to respond to upcoming consultations	Contact Lou to join the circular textiles mailing list Read a summary of our engagement with the Circular Economy Taskforce on textiles
Mandatory food waste reporting	Q1 2026: Mandatory food waste reporting may feature in Defra’s Circular Economy Growth Plan, as part of a roadmap for the agri-food sector.	Understand what mandatory reporting may mean for your business Prepare to respond to upcoming consultations	Contact Lou to join the food waste mailing list Read a summary of our engagement with the Circular Economy Taskforce on agri-food
Waste electronic and electrical equipment (WEEE) Takeback scheme	Q1 2026: Circular Economy Growth Plan to be published by Defra, outlining a roadmap for the electricals sector.	Understand what a takeback scheme for WEEE may mean for your business Prepare to respond to upcoming consultations	Contact Naomi to join the WEEE mailing list Read a summary of our engagement with the Circular Economy Taskforce on WEEE

Forward-look

Focus Area

What?

What To Do

BRC Support

Eco-design requirements, digital product passports, and circular business models

The circular economy has been a significant policy focus over the past 24 months, particularly for UK retailers on the front-lines of delivering a host of incoming packaging and recycling regulation. This momentum is only set to extend to other sub-sectors and categories, with the Circular Economy Growth Plan in 2026.

In the EU, the circular economy is moving even faster. The Ecodesign for Sustainable Products Regulation (ESPR) is set to introduce product eco-design requirements for material circularity and energy efficiency from 2028/29, with Digital Product Passports (DPPs) mandated to provide sustainability information to consumers. Textiles and furniture are prioritised product categories for the first implementation phase.

Similar requirements may be on the horizon for the UK.

Prepare for the publication of the Circular Economy Growth Plan, to assess what transformations may be necessary in the coming years ahead of implementation.

Explore how your business may integrate circular principles into its business model to reduce waste, and recycle and reuse materials.

Evaluate your product-level data systems, to assess your readiness for future DPPs data requirements.

Contact Inga for more information on ESPR energy efficiency eco-design requirements and DPPs regulation

Contact Lou to join the circular textiles mailing list for future updates on textiles-related legislation

Read UL’s explainer on the ESPR

Climate & Net Zero

2026 Priorities

Focus Area	What?	What To Do	BRC Support
UK Sustainability Reporting Standards (SRS)	H1 2026: Subject to further consultation, Government may introduce a mandatory requirement for UK-listed companies to report on climate- and sustainability-related risks and impacts, scopes 1-3 emissions, and governance, strategy, and targets on sustainability under the (currently voluntary) UK SRS.	Prepare for the consultation outcome on a mandatory reporting requirement and potential further consultation (TBC) on the scope and timeframe for a requirement Review existing reporting practices to scope out early business readiness, e.g.: SECR requirements for scopes 1 & 2 reporting TCFD for the proposed ‘climate-first’ approach to disclosure under UK SRS TNFD for a nature disclosure framework TPT Disclosure Framework for IFRS/UK SRS S2	Use the Climate Action Roadmap Pathway 1 Guidance for ‘Placing GHG data at the heart of decision-making' Read the BRC’s final submission to the UK SRS consultation for more details on our position Contact Tracey to get involved in the Climate Action Roadmap’s Data & Reporting Pathway activities.
Climate-related Transition Plans	H1 2026: Subject to further consultation, Government may introduce a mandatory requirement for certain large companies to develop and/or disclose a science-aligned climate-related transition plan.	Prepare for the consultation outcome on a mandatory transition plan requirement and potential further consultation (TBC) on the scope and timeframe for a requirement	Read the BRC’s final submission to the transition plan consultation for more details on our position Contact Tracey to get involved in the Climate Action Roadmap activities.
EU Empowering Consumers for the Green Transition Directive (ECGT)	September: The ECGT will introduce new standards for product green claims and strengthen consumer rights against unfair claims, to ensure consumers can make informed, eco-friendly choices and that businesses are more transparent. Increases scrutiny by requiring proper third-party verification for any environmental claims and labels.	If you place products on the EU market, prepare for enforcement by building transparent, verifiable environmental claims, and audit sustainability messaging on packaging, labels and marketing	The BRC does not directly support on EU regulation. However, we will monitor the impact of EU claims standards on UK developments, and advocate for alignment where possible and sensible. Contact Tracey to get involved in the Climate Action Roadmap’s activities on green claims

Forward-look

Focus Area	What?	What To Do	BRC Support
EU Corporate Sustainability Reporting Directive (CSRD)	Certain companies will be required to report according to the European Sustainability Reporting Standards (ESRS), to disclose information on ESG risks, impacts and opportunities. CSRD has undergone large simplifications, with the final Omnibus 1 package of changes confirmed in December 2025. The package has significantly altered the regulatory scope and timeframes, with reporting requirements for most companies delayed until FY2027-28 or beyond, and SMEs and non-EU companies now largely falling out of scope.	Get up to date on the recent changes to reporting scope and timeframes under the EU Omnibus 1 package, to understand whether your business is still obligated in the coming years.	The BRC does not directly support on EU regulation. However, we will monitor the impact of EU reporting requirements on UK regulation (i.e. UK SRS), and advocate for alignment where possible and sensible. Contact Tracey to get involved in the Climate Action Roadmap’s Data & Reporting Pathway activities.
Voluntary global reporting initiatives	Recent public consultations on the SBTi’s Corporate Net Zero Standard and the GHG Protocol’s scope 2 guidance are expected to result in notable changes to global reporting frameworks over the coming years. Changes are aimed at improving business usability and relevance of disclosed information, but enhanced requirements may also impose increased resource burdens on businesses reporting voluntarily.	If you are reporting under a voluntary framework, prepare for changes to reporting and accounting requirements. If you are not already, consider reporting under voluntary public disclosure initiatives, such as CDP, to enhance transparency, manage risks and benchmark ESG performance. New BRC annual industry emissions footprinting is based on CDP data to monitor retail progress.	Read the BRC’s UK Retail 2025 Net Zero Stocktake, summarising UK retail industry progress in reducing emissions by utilising data reported to CDP as part of a new industry emissions methodology. Contact Tracey to get involved in the Climate Action Roadmap’s Data & Reporting Pathway activities.
Product-level data and verifiable green claims	Despite the EU Green Claims Directive remaining on hold, there is a host of regulation entering into force in the coming years, such as the European Deforestation Regulation (EUDR), EU Empowering Consumers for the Green Transition Directive (ECGT) and Ecodesign for Sustainable Products Regulation (ESPR), that will require retailers in the EU to collect and disclose robust data on their products. With product carbon footprints representing a notable challenges for retailers, significant work must be done as an industry to plug data gaps, standardise collection and disclosure frameworks, and harmonise sustainability claims about products. It is likely that these developments will influence UK regulation, as a mandatory reporting requirement under SRS and the introduction of Digital Product Passports (DPPs) are considered, and the Competition & Markets Authority (CMA) ramps up its claims scrutiny following the entry into force of the DMCC Act in April 2025.	Audit the sustainability messaging on your packaging, labels and marketing, to ensure claims and labels are transparent and verifiable. Assess your existing data collection processes and systems, evaluate gaps and weaknesses, and consider improvements. Businesses may want to start engaging top suppliers on a standardised framework for collecting key material data, or contribute to industry-level initiatives to spur the systemic transformations required deeper within supply chains.	Contact Tracey to get involved in the Climate Action Roadmap’s Data and Reporting Pathway activities.

Nature & Biodiversity

2026 Priorities

Focus Area

What?

What To Do

BRC Support

Mandatory Human Rights & Environmental Due Diligence (mHREDD)

H1 2026: As part of its review of Responsible Business Conduct (RBC), Government is expected to make recommendations to improve business conduct, including mandatory due diligence legislation. Policy recommendations may seek to address deforestation-linked commodities and align with EU due diligence legislation.

Prepare for the outcome of the Government’s review

Contact Lou to join the Nature mailing list

Read the BRC’s final position statement submitted to DBT on the RBC review

EU Deforestation Regulation (EUDR)

December: Following the further 12 month delay to the EUDR, operators first placing a product on the market now have an extra year to demonstrate due diligence on forest-risk commodities (cattle, timber, cocoa, soy, palm oil, coffee, rubber) exported to EU to prove they are not sourced from deforested areas.

If you trade in the EU, prepare for further simplifications ahead of the delayed December 2026 entry into force, following EU Commission’s simplification review in April 2026.

If you trade in NI, await a decision on EUDR application to NI. UK Government has still not yet confirmed whether and to what extent EUDR will apply.

Prepare for the outcome of the RBC review, which may contain a position on how mHREDD legislation, if adopted, will include policy interventions to address deforestation-linked commodities.

Contact Lou to join the EUDR Working Group and Nature mailing list

Read the BRC’s final position statement submitted to DBT on the RBC review, containing the details of our position on a UK deforestation regulation that is aligned with the EUDR.

Forward-look

Focus Area

What?

What To Do

BRC Support

Reporting on nature-related risks, impacts and opportunities

Joined-up reporting on climate and nature will support businesses to connect the dots between their wider environmental impacts, risks and opportunities and is increasingly becoming an imperative for businesses, with the rise in popularity of voluntary reporting frameworks (TNFD) and regulatory requirements (UK SRS, EU CSDDD) moving at pace.

Get involved in the BRC’s Nature programme to learn more about retailer action on nature.

Contact Lou to join the Nature mailing list

Learn more about the BRC’s Plan for Nature

Watch out for the BRC and RSK Group’s Nature Positive Plan. The BRC will focus on supporting retailers by upskilling on how to get started, including with nature reporting, and encouraging standardised approaches to nature disclosures and data collection.

Human Rights

2026 Priorities

Focus Area

What?

What To Do

BRC Support

Mandatory Human Rights & Environmental Due Diligence (mHREDD)

H1 2026: As part of its RBC review, Government is expected to make recommendations to improve business conduct, including mandatory due diligence legislation for human rights and potential import bans on goods made with forced labour

March: The Government will publish their National Baseline Assessment on the Implementation of the UN Guiding Principles on Business and Human Rights, with policy recommendations for government and businesses.

Prepare for the outcome of the Government’s RBC review and National Baseline Assessment

Contact Lou to join the ethical labour mailing list

Read the BRC’s final position statement submitted to DBT on the RBC review

Forward-look

Focus Area

What?

What To Do

BRC Support

EU Forced Labour Regulation

From April 2027, products made with forced labour will be banned from being imported into or exported from the EU.

Despite the 2015 Modern Slavery Act being world-leading at its time of introduction, the UK has since lagged behind global progress on tackling forced labour in international supply chains. To avoid becoming a dumping ground for cheap imported products made with forced labour, it is expected – and necessary – that the UK Government consider legislative measures to address adverse human rights conditions in UK supply chains.

If operating on the EU market, comply with upcoming obligations by conducting necessary due diligence and prepare for product bans. It is still unclear how the FLB will impact Northern Ireland.

Understand what human rights risks and impacts exist across your supply chains, and strengthen due diligence processes ahead of increased scrutiny.

Contact Lou to join the ethical labour mailing list