MHA Q&A: How Regulatory Uncertainty is a Value Opportunity
As sustainability regulation continues to evolve, uncertainty has become the new constant. With the European Commission’s recent “Stop-the-Clock” Directive and subsequent adjustments to the Corporate Sustainability Reporting Directive (CSRD) creating fresh waves of delay and debate, sectors across Europe – and beyond – face both breathing room and new complexity. For many, the question is simple: pause or push forward?
Mark Lumsden-Taylor, Global Executive Lead for Development and Sustainability at MHA, the UK member firm of Baker Tilly International, believes the answer lies in strategic acceleration rather than cautious retreat. Drawing on extensive experience advising businesses navigating ESG transformation, Mark has been at the forefront of translating regulation into opportunity – helping companies move from compliance to value creation.
MHA, part of the Baker Tilly International network of independent accountancy and business advisory firms, operates across more than 140 territories worldwide. The firm supports organisations through sustainability reporting, assurance and strategic transformation – guiding them through frameworks such as the CSRD and beyond. Within this global network, MHA plays a leading role in shaping UK and European understanding of how ESG reporting connects to long-term business resilience.
In this Q&A, Mark reflects on how companies can respond to the shifting regulatory landscape – where “stop-the-clock” does not mean “stand still.”
As he puts it, this is a time to reprioritise, not relax.
The Omnibus “Stop-the-Clock” Directive and adjustments to the CSRD have created new uncertainties and sector-specific delays. How should companies respond to these moving goalposts, and what pitfalls should they avoid?
Quite simply, companies should treat this as a reprioritisation window not a relaxation.
Companies should:
- Stay on track with CSRD readiness – maintaining data mapping, double materiality assessments, and governance integration
- Use the delay strategically – to strengthen data quality, refine value-chain reporting and embed quality assurance processes
- Engage early with auditors and sustainability teams to align on interpretations before the new guidance emerges
By implication, companies with a more relaxed attitude at this stage might find themselves facing a number of pitfalls, such as:
- Complacency. Waiting for final clarity risks later time compression and a rush to meet deadlines
- Fragmented ownership. ESG reporting can become siloed instead of being cross-functional
- Short-term focus. The delay does not change investor and stakeholder expectations for transparency
In short, use the time wisely. Pause but don’t stop. There may be a delay, but the scrutiny doesn’t stop.
Many leading companies are accelerating their sustainability reporting efforts, even as CSRD and other European regulations face delays. What do you see as the main strategic advantages for businesses who “charge ahead,” rather than waiting for legal certainty or deadlines to arrive?
Let us imagine for a moment that you accept the argument and move forward despite the delays in CSRD and other European legislation. What could that mean for your business?
Again, put simply, your company will gain strategic advantages. It will build credibility early, strengthen investor confidence, and embed sustainability data discipline before it becomes mandatory.
When ESG metrics inform decision-making, reporting becomes a driver of performance and resilience, of future business sustainability rather than just a cost of compliance
Early adopters can shape reporting practices, secure the right talent, and integrate ESG into their business strategy, turning compliance into strategic business advantage. In short, acting now transforms CSRD readiness from a regulatory burden into a strategic advantage and a signal of leadership.
How has investor and customer demand for reliable sustainability data shifted the conversation away from regulatory compliance and toward competitive necessity, as you discussed at Sustainability LIVE London?
Although regulation might pause, customer, investor and other stakeholder expectations do not.
It is the foolish company that fails to recognise this and act upon it.
Investor and customer demand for credible, comparable sustainability data has moved ESG reporting from a compliance exercise to a business imperative. Transparent data now drives capital access, customer trust, and brand preference. Sustainability performance is no longer a regulatory tick-box, it is a key competitive differentiator, as important as business and brand performance.
In your experience, does treating sustainability reporting as a value-creation tool (rather than an administrative burden) lead to measurable benefits for companies?
Companies that treat sustainability reporting as a value-creation tool, rather than simply as an administrative burden, will gain measurable benefits that range from improved efficiency through to better data, stronger stakeholder trust, easier access to capital, and clearer strategic insight.
When ESG metrics inform decision-making, reporting becomes a driver of performance and resilience, of future business sustainability rather than just a cost of compliance.
As the regulatory landscape in Europe and beyond continues to shift with further delays and revisions, what practical steps should corporate leadership teams take today to future-proof their sustainability strategy, regardless of legislative timing?
Whilst legislation in Europe, and further afield, may be faced with delays and revisions, in my opinion that is not an option for businesses seeking a sustainable future. Leadership teams need to stay proactive and continue building robust data systems, strengthening their governance around ESG, and integrating sustainability into the core business strategy and risk management. The issues that have driven the legislation to date, are business critical and all the evidence points to the fact that they are not going away, are affecting businesses increasingly and need more than just consideration if a business is to build a sustainable future.
Legislative pauses provide an opportunity to invest in data quality and cross-functional coordination, to commence scenario-planning and ensure the organisation is agile and responsive. This will ensure that a forward-thinking company’s sustainability strategy is resilient, credible, and future-ready, regardless of movements in regulatory timelines. After all, can you really afford not to?
