A quarter-by-quarter guide to the most important climate-risk milestones, disclosure deadlines, and regulatory shifts

Physical climate risk is already affecting real assets portfolios. It’s showing up in capex requirements, insurance terms, operating performance, and valuation assumptions.

Most firms can access climate data, but those insights often sit in siloed reports, disconnected from how deals are priced, how assets are operated, and how portfolios are monitored. That creates blind spots that lead to mispriced risk, avoidable value erosion, and higher regulatory and reputational exposure.

2026 is the year those gaps are more likely to surface. Disclosure regimes mature, validation expectations rise, and reporting cycles increasingly demand evidence that is traceable and defensible.

To help investment, sustainability, and risk teams plan ahead, we’ve consolidated the most relevant global events, regulatory deadlines, and market signals, structured quarter by quarter, based on the 2026 climate-risk and sustainability calendar.  

Q1 2026: New disclosure regimes and early climate-risk signals

California SB 261 (paused, but still influential)

SB 261 is currently slated to take effect in January 2026, but enforcement is paused pending ongoing litigation.

Even so, many large asset managers and corporates have already begun preparing voluntary SB 261–aligned climate risk reports. Why?

• Investors increasingly expect TCFD/IFRS-aligned disclosures regardless of the legal outcome.
• Preparing early reduces regulatory risk if the law proceeds.
• Even voluntary reports help firms establish governance, scenario analysis workflows, and data foundations.

In short, SB 261 is paused, not irrelevant and voluntary reporting remains both common and strategically useful.

World Economic Forum Annual Meeting (January)

WEF sets the year’s macro narrative. Climate resilience, adaptation, and risk pricing discussions can influence the market expectations and influence investor, regulator and LP sentiments.

Global CRE sustainability outlooks (February–March)

Sector outlooks and research releases can shift assumptions on retrofit costs, obsolescence risk, and resilience capex. For real estate investors, these publications often feed directly into underwriting and portfolio strategy discussions. For example:

• Reports from ULI and JLL shape expectations around retrofit costs, asset obsolescence, and resilience.  
• REC Europe releases its Sustainable Finance Report, with insights that impact real-estate credit and valuation.  

MIPIM (March)

MIPIM is a practical signal on how climate risk is influencing capital deployment, covenant structures, lender requirements, and due diligence depth in real assets markets.

By the end of the quarter, the regulatory direction for the year is clear, and asset managers face rising expectations for incorporating science-based physical risk into investment decisions.

What to do this quarter

• General Partners (GPs): Confirm how physical climate risk evidence will flow into investment committee memos and models, including how it affects downside cases, capex assumptions, and underwriting for assets with long hold periods. ‍
• Limited Partners (LPs): Define the minimum standard you expect from managers in 2026 reporting: scenario alignment, method transparency, comparability across funds, and evidence trails.

Q2 2026: The busiest season for risk assessment and compliance preparation

GRESB Portal Opens (April)

GRESB submissions begin and typically trigger internal effort across ESG, risk, investment, and asset teams. In 2026, there will be deeper requirements on risk exposure, resilience, and adaptation planning.  

UAE climate-reporting deadline (May 30)

Banks and regulated entities must meet reporting obligations under Federal Decree-Law No. 11/2024. For investors with regional exposure, it is a useful indicator of how quickly reporting expectations are tightening across jurisdictions.

NYC Local Law 97 Reporting (May 1)

Buildings must submit emissions performance data. Enforcement and penalties are a direct example of how regulation can translate into operating cost, capex acceleration, and asset strategy changes in real estate portfolios.

NOAA Hurricane Season Outlook (late May)

For portfolios exposed to coastal hazards, this is a useful planning input for insurance discussions, operational readiness, and risk concentration reviews. It is especially relevant for infrastructure and energy assets with exposure to storms and high wind events.

ESRS Adoption Deadline (June 30)

The EU aims to adopt sector-specific and third-country ESRS standards. For asset managers with European holdings, this further clarifies the direction of travel for what “good” climate risk disclosure needs to include.

This period establishes the risk baseline for the year: market indicators, regulatory filings, and hazard forecasts converge, creating direct implications for valuations and capex planning.

What to do this quarter

• GPs: Treat Q2 as baseline-setting. Align data, assumptions, and scenarios so outputs are consistent across GRESB, ESRS-related requirements, and LP requests. Make sure the same asset identifiers and methodology can be used across real estate, energy and infrastructure holdings. ‍
• LPs: Pressure-test manager responses early, not at year-end. Ask what evidence sits behind the headline metrics and how uncertainty is handled, especially for long-hold assets where tail risks matter.

Q3 2026: Verification, scenario analysis, and escalated reporting

GRESB Submission Deadline (July 1)

Missing the deadline or submitting incomplete data can can create downstream effects on debt pricing (SLL margins) and may influence financing conversations linked to ESG performance and transparency.

Australia IFRS S1/S2 Reporting Begins (July 1)

Mid-sized entities begin mandatory climate-risk disclosures aligned with IFRS S2, reinforcing global expectations for scenario-aligned physical risk analysis and decision-useful reporting.

California SB 253 Emissions Disclosure (August 10)

SB 253 introduces mandatory Scope 1, 2, and 3 emissions reporting for large companies operating in California.

While SB 261 (climate-risk disclosure) is currently paused pending litigation, many firms still expect both laws to shape future reporting. Together, they outline a potential dual pathway:

• SB 253: emissions quantification ‍
• SB 261: climate-related financial risk

For asset managers with California operations, this means preparing for emissions reporting now, while monitoring SB 261 developments and voluntarily aligning with IFRS/TCFD-style risk disclosures.

GRESB Validation Period (August)

Clarification requests require defensible evidence, data provenance, and methodological transparency.  

This is often where operational strain becomes most visible.

Climate Week NYC (September)

A key moment where disclosed strategies, risk narratives, and transition plans are scrutinised by investors ahead of year-end reporting cycles.

This is the highest-pressure period. Asset managers must demonstrate that data is defensible, methods are transparent, and results are verifiable.

What to do this quarter

• GPs: Prepare for validation dynamics. Document methods, assumptions, and controls as you produce outputs, not after the fact. If climate risk is meant to influence investment and asset management decisions, make the decision trail visible. ‍
• LPs: Benchmark managers. Look for consistency and proof that climate risk is changing decisions, not only improving reporting language.

Q4 2026: Financial consequences, new standards, and strategic positioning for 2027

GRESB Results Released (October 1)

GRESB scores can influence investor perception, competitiveness in fundraising, and the quality of financing discussions.

ULI Europe, ULI North America, EXPO REAL (October–December)

Real assets outlooks often consolidate market narratives around valuation divergence, retrofit obligations, liquidity impacts, and resilience capex requirements across asset classes.

COP31 (November)

Global negotiations can influence expectations around transition pathways and policy direction, even when immediate impacts are indirect.

UK SDR Reporting (December 2)

Asset managers with £5–50B AUM must publish their first entity-level Sustainability Disclosure Requirements (SDR) report. This is a major milestone for governance, claims substantiation, and evidence quality.

RICS Sustainability & Property Market Reports (December)

These set end-of-year benchmarks for resilience, stranded-asset risk, and retrofit obligations.

Financial impacts become tangible: performance scores publish, climate reporting crystallises, and planning for 2027 begins in earnest.

What to do this quarter

• GPs: Lock the operating model for 2027. Standardise what the firm will measure, how it will be evidenced, and how insights will feed underwriting, asset management plans, insurance decisions, and exits. ‍
• LPs: Convert 2026 learnings into stronger mandates. Specify what “good” looks like for 2027, including comparability across managers, minimum evidence standards, and how climate risk is expected to be reflected in governance and capital allocation.

What this means for asset managers in 2026

Across all four quarters, one theme stands out: physical climate risk is no longer a peripheral ESG issue, it is now a financial, operational, and regulatory priority.  

For asset managers, 2026 will require a shift from disclosure-driven compliance to integrated, forward-looking risk management.

Physical climate risk becomes a governance and fiduciary obligation

Regulators in the UK, EU, US, and Australia now expect firms to demonstrate that climate risk is understood, monitored, and embedded in investment decisions.

This means defensible data, scenario analysis, internal oversight, and decision-useful outputs, not generic risk statements.

Data must be transparent, traceable, and scientifically grounded

Across SB 261, ESRS E1, SDR, IFRS S2, and GRESB, scrutiny is moving towards the provenance of climate data and the robustness of methodologies.

Asset managers will need science-based, audit-ready inputs supported by uncertainty quantification and clear assumptions.

Portfolio valuation will need to reflect climate-driven risk and cost

New disclosure regimes, emissions penalties, insurance pressures, and local regulations (e.g., NYC LL97) all create direct financial consequences:

• For energy and infrastructure, climate risk can affect yield, downtime, degradation, damage and loss, and insurance availability.
• For real estate, it can accelerate capex needs, increase operating costs, and affect liquidity and exit assumptions.

Climate-adjusted valuation models, capex planning, retrofit scenarios, and hazard-driven repricing will become mainstream.

Investors will demand clearer evidence of resilience

GRESB scores, fund reporting, and LP due diligence increasingly emphasise:

• hazard exposure
• resilience measures and adaptation planning
• long-term operability under different climate scenarios
• credible governance and reporting processes

Managers who cannot demonstrate resilience may face higher capital costs and reduced fundraising competitiveness.

Global fragmentation requires unified workflows

Frameworks overlap heavily but differ in detail. Asset managers will need one defensible dataset and consistent methodology reduce duplication, improve comparability, and help teams respond faster to validation requests and stakeholder questions.

Scenario analysis, uncertainty, and tail-risk visibility become essential

Expectations are moving beyond point estimates and historic averages. In 2026, firms increasingly need:

• multi-scenario physical risk projections
• probabilistic outputs, including percentile ranges (e.g., 5th/50th/95th percentiles)
• visibility into extreme events and return periods up to 1,000 years
• hazard-by-horizon decision support aligned to real assets hold periods

Firms without this capability risk non-compliance and mispriced assets.

Operational teams face increasing validation and audit demands

GRESB validation, assurance requirements, and audit expectations increase the need for clear evidence of:

• methodologies
• assumptions
• uncertainty treatment
• controls and governance

This will intensify the need for defensible, well-documented climate-risk workflows.

In short, 2026 is the first year where climate risk has material, unavoidable financial consequences for asset managers. Those who invest early in transparent, science-based climate intelligence will be better positioned to protect value, meet regulatory expectations, and compete for capital.

6 practical steps to prepare for 2026

Asset managers can reduce operational pressure and improve regulatory readiness by acting early across six areas:

1. Build a defensible physical climate-risk baseline

Start with asset-level exposure mapping across all major hazards. This baseline informs investment decisions, risk registers, and disclosure narratives.

2. Strengthen scenario-aligned analysis

Use consistent climate scenarios (e.g. SSP1, SSP2, SSP5) to model risk trajectories across near-term, mid-century, and end-century horizons.  

Regulators expect forward-looking, probabilistic insights, not historical averages.

3. Prioritise uncertainty and tail-risk visibility

Model best-case, median, and worst-case climate outcomes. For hazards like flooding and wind, return periods up to 1,000 years are essential for understanding rare, high-impact events.

4. Prepare for evidence-based reporting

Build documentation as you go: methodologies, assumptions, limitations, governance controls, and traceable inputs. This reduces friction during validation and audit cycles.

5. Integrate risk into valuation, capex and O&M planning

Retrofit costs, insurance changes, climate-driven underperformance, and hazard-driven obsolescence should feed directly into underwriting, business planning, and asset strategy.

6. Avoid duplication across regimes

SB 261, SB 253, CSRD/ESRS, SDR, and IFRS S2 share overlapping physical-risk expectations. A single, science-based dataset can serve multiple regulatory workflows if structured correctly.

How Mitiga Solutions helps asset managers navigate 2026

Mitiga Solutions supports end-to-end climate-risk workflows with:

• Asset-level modelling across all major hazards: Including flood, heat, drought, wildfire, extreme wind, and more. ‍
• Probabilistic outputs with uncertainty quantification: 5th, 50th, and 95th percentiles help teams understand risk ranges, essential for stress testing and governance. ‍
• Return periods from 2 to 100 years for all hazards, and up to 1,000 years for flood and wind: A major differentiator for insurers, banks, and investors assessing tail-risk exposure. ‍
• Scenario-aligned projections under SSP1/2/5: Directly supporting IFRS S2, TCFD, UK SDR, GRESB, and SB 261 requirements. ‍
• Disclosure-ready outputs for ESRS E1 (CSRD), IFRS S2, TCFD, SB 261, and more: Structured Excel files and narrative guidance accelerate compliance ‍
• Scalable API and portfolio-wide screening: Designed for investment, risk, and sustainability teams who need fast, defensible insights.

Final take

2026 is not just another reporting year. It’s the point at which climate-risk regulation, market expectations, and physical hazards converge with real implications for capital allocation, valuation, and portfolio performance.

Teams that invest early in transparent, science-based climate intelligence, and integrate it into everyday workflows, will be better positioned to protect value, meet regulatory expectations, and stay credible with investors.

If you want support integrating physical climate risk into your 2026 planning, Mitiga Solutions can help. Book a demo today.