Horizon scanning to forecast regulatory change

Foresight, horizon scanning, and emerging litigation trends are reshaping risk at the C-level, adding pressure on ESG disclosures. Consequently, leaders must navigate these upcoming regulations and expectations. 

In our webinar, Forecasting the future: ESG trends and compliance strategy, regulatory experts provide insight on horizon scanning, scenario planning, and trend analysis to inform future business decisions. 

This summary provides some of those thoughts on horizon scanning to stay ahead of supply chain obligations and shifts in the EU regulatory landscape.

Horizon scanning to prepare ahead of time

In the compliance circuit, horizon scanning has become a major topic of conversation, centred around helping businesses forecast regulatory developments ahead of time so they can proactively adapt their processes and operations to meet compliance — saving time and reducing risks.
 

Defining horizon scanning 

In a legal context, Paula describes horizon scanning as “a proactive process where companies not only stay aware of legal and regulatory developments, but they identify and assess the [regulations] that could impact their organization.” The horizon scanning helps businesses anticipate what’s coming down the regulatory pipeline, so they can ahead of time rather than reacting in real-time. 

Horizon scanning consists of: 

• Systematic monitoring of regulations 

• Identifying trends as they filter through new bills and laws 

• Analyzing the operational impacts of upcoming regulations 

• Developing scenarios to tackle new legislation 

• Gaining actionable insights to devise an effective and efficient plan of action
   

Why is horizon scanning important? 

Horizon scanning has two main purposes: 

• To spot potential regulatory risks early on — for example, new obligations to be enforced or shifts in enforcement 

• To uncover opportunities that might come with regulations — for example, new incentives or new advantages companies might have for being the first to adopt new laws 

Horizon scanning isn’t just about gathering information; it’s also about identifying the urgent updates to prioritize actions. It also functions as a “powerful driver for team collaboration,” Paula said, with multiple teams sharing responsibility (legal, compliance, HR, product development, for example).  

Horizon scanning also informs planning, particularly in terms of how we use the analysis of impacts to better support communities as they develop, and how scenario development can help us visualize new possibilities. Furthermore, horizon scanning helps to generate actionable insights, informing decision-making with a better understanding of what’s coming and how to respond appropriately.
 

Leveraging horizon scanning tools 

Regulatory tools such as EHS Intelligence’s Regulatory Forecaster and Corporate Sustainability’s Sustainability Forecaster allow businesses to anticipate new requirements and adapt ahead of time, with extensive coverage of EHS regulations that might impact your industry. 

• Get visibility into regulatory changes ahead of time 

• Understand the business impacts so you know how to respond accordingly 

• Reduce risks, disruption, and costs by changing processes before implementation 

• Enhance team collaboration to tackle challenges more effectively 

• Prioritize regulations so you know what to address first

Horizon scanning for supply chain

Global supply chains are fast-becoming one of the most complex challenges companies are facing today. Having supply chains around the world forces businesses to monitor changes across continents, tracking regulations at their own location as well as across landscapes. Further challenges of operating worldwide include language constraints, legislative process, and enforcement culture, with disparate understandings and prioritizations of the law. 

For example, the European Union (EU) mandates enhanced transparency and due diligence for operators in the EU, but also to any supplier with EU connections. These regulations are therefore applicable to companies across the globe, with guidance and standards relevant to international supply chains.
 

Supply chain regulations 

The latest developments regarding supply chain and due diligence in the EU have also been developed with horizon scanning opportunities, as each of these laws was announced many months or years before implementation would be mandatory. This allows companies to conduct horizon scanning to prepare ahead of time: 

• The EU Deforestation Regulation (EUDR) — although the law was introduced in 2023, it’s not applicable until 2025 and 2026, depending on the size of the company 

• The EU Forced Labor Regulation — entered into force in December 2024, but doesn’t apply until 36 months later in 2027 

Many EU regulations are also targeting specific products and commodities so businesses know what to focus on and prioritize as they adapt their internal processes, material use, and operations, ensuring their products are made sustainably and responsibly with little to no impact on human health or the environment.  

Many companies are embedding horizon scanning into their supply chain risk management and performance processes. This process fosters cross-functional collaboration, with legal performance and sustainable compliance teams working together to assess the readiness of their suppliers. 

This complex regulatory landscape is consequently navigated by regulatory intelligence, resulting in actionable steps for operational teams and suppliers.

Horizon scanning for shifts in the landscape

The regulatory landscape in Europe is evolving fast — with a large number of regulations and legislation impacting EU (and non-EU) companies, such as: 

• Omnibus simplification package 
• Corporate Sustainability Reporting Directive (CSRD) 
• Corporate Sustainability Due Diligence Directive (CSDDD) 

Outside of the EU, state-level climate action and deregulation in the United States, and the International Sustainability Standards Board (ISSB) standards in Asia-Pacific, are triggering global developments for multinational companies to keep an eye on.
 

Omnibus 

In June 2025, the EU council agreed with the Omnibus’ updates to the CSRD and CSDDD: 

1. Changing the scope of the CSRD to be more expansive and increasing the threshold to 5,000 employees and 1.5 billion net turnover 
2. Removing the current CSRD’s obligation to adopt and implement climate transition plans 

In terms of horizon scanning, climate transition plans are climate strategic decisions and actions for companies to assess their risks and opportunities related to the climate. These plans should be embedded in the business strategy, and compatible with the Paris Agreement and EU Climate Law, to achieve climate neutrality by 2050.
 

The proliferation of AI 

Artificial intelligence (AI) also represents a major shift in the approach to compliance and sustainability. The use of AI is increasing exponentially, with new technology brewing new regulations to moderate its use. Companies are developing AI systems to aid with horizon scanning methods to stay on top of these emerging laws.  

In the EU, the EU AI Act is a landmark regulation from 2024, marking the first on AI. It establishes obligations to assess the risks of AI systems, applicable from mid-2027.
 

Greenwashing 

The global trend of greenwashing is focused on increasing awareness of environmental claims made by businesses, and enhancing regulatory scrutiny on false ‘green’ product claims. 

In 2023, the European Commission introduced the Green Claims Directive proposal to target explicit voluntary claims that concern the environmental impact of performance of products that aren’t currently covered by other EU rules. 

This proposal not only means to protect consumers, but also businesses, by encouraging them to innovate safer and more sustainable products. 

As of June 2025, the proposal may move on for negotiations or be withdrawn. 

For more details on the shifts in the US landscape, watch the full webcast to hear from guest speakers and law professors from the University of Miami, Abigail L Fleming and Precious Gift Makuyana.