Corporate Sustainability Disclosure Standard No. 1 – Climate: A Preparation Guide for Global Manufacturers
China issued Corporate Sustainability Disclosure Standard No. 1 – Climate in December 2025. It is a voluntary trial, aligned with IFRS S2 but built on double materiality and local carbon accounting rules. It covers Scope 1, 2 and 3 emissions across four pillars plus impacts. Manufacturers with Chinese operations or suppliers should build one audit-grade dataset now that also serves CSRD and ISSB.
If your company operates in China or buys from Chinese suppliers, a new reporting rule now sits alongside CBAM and CSRD on your desk. In December 2025, China's Ministry of Finance issued Corporate Sustainability Disclosure Standard No. 1 – Climate (Trial), the country's first thematic climate disclosure standard. It is voluntary today. It will not stay that way.
The standard borrows its structure from IFRS S2, but it adds requirements that go further. Analysts note it includes double materiality and rules that go beyond many global standards. For a global manufacturer, that means a second climate disclosure regime with its own data rules, layered on top of the European ones you already manage.
This guide explains what the standard requires, who it applies to, and how it differs from ISSB and CSRD. It then shows how to prepare with one dataset instead of three. Manufacturers who act during the trial period will report faster and look credible when the rules turn mandatory.
What is Corporate Sustainability Disclosure Standard No. 1 – Climate?
Corporate Sustainability Disclosure Standard No. 1 – Climate is China's first dedicated climate disclosure standard, issued as a voluntary trial in December 2025. The Ministry of Finance and eight other authorities released it. It sets unified rules for how companies report climate-related risks, opportunities, and impacts.
Who issued it and when
The Ministry of Finance led the release, joined by bodies including the Ministry of Ecology and Environment and the People's Bank of China. PwC's analysis of the Climate Standard notes that it was informed by IFRS S2 and is intended to produce functionally equivalent results, while adding distinct Chinese features.
Where it sits in China's disclosure system
The climate standard is the first thematic rule under China's Basic Standard, which the Ministry of Finance issued in November 2024 to set the top-level framework. More thematic standards, covering topics such as water and workforce, are expected to follow. The standard supports China's dual-carbon strategy, including China's first absolute emissions goal. It marks the shift from principles to a working reporting regime.
Who does it apply to, and when does it become mandatory?
The standard is voluntary during the trial. No company must comply yet. The Ministry of Finance plans to expand it in stages: from listed to non-listed companies, from large firms to SMEs, from qualitative to quantitative requirements, and from voluntary to mandatory disclosure. Large listed companies are the first priority.
Foreign companies and Chinese subsidiaries
Multinationals are exposed on two fronts. Their Chinese subsidiaries fall within the reporting population as the scope widens. Their supply chains are exposed too, because firms with Chinese suppliers, joint ventures, or customers will need emissions data that matches the standard's quality. That data pressure travels up the chain to European and North American buyers.
The phased roadmap
China's roadmap targets climate standards by 2027 and a full disclosure system by 2030. The finalised climate standard arrived ahead of that schedule. One analysis estimates the standard will reach more than 5,000 listed companies as it scales. The exact scope and date for mandatory application are not yet fixed in law, so treat current timelines as signals, not deadlines.
How to get started: identify every Chinese legal entity you own and confirm which could fall in the first mandatory wave.
The four-pillars-plus-impacts structure
The standard organises disclosure around four pillars: Governance, Strategy, Risk and Opportunity Management, and Metrics and Targets. This mirrors the structure of IFRS S2 and will feel familiar to any team that already reports under ISSB or ESRS.
China adds a fifth element. The official guidance describes a four-pillars-plus-impacts approach, which requires companies to disclose material climate-related impact information that the four pillars do not capture. The Strategy pillar covers scenario analysis and the key assumptions behind it. Companies must also disclose the amount and proportion of assets or business activities exposed to physical risk, transition risk, and climate-related opportunities.
For a manufacturer, that last requirement is concrete. You report not only your emissions, but how much of your asset base and revenue sits in the path of climate risk. That calls for asset-level and product-level data, not a company-wide estimate.
How it differs from ISSB and CSRD
The standard aligns structurally with IFRS S2, but three features set it apart. It requires double materiality, not only financial materiality. It requires Chinese carbon accounting methods rather than the GHG Protocol by default. And it asks for internal carbon pricing alongside climate-related capital expenditure.
The methodology rule is the trap most teams miss. Companies must calculate emissions using carbon accounting standards set by Chinese authorities and disclose the basis they used. The GHG Protocol serves only as a reference where a local standard does not exist. If your global inventory runs on the GHG Protocol alone, your China numbers will need a second calculation path.
On materiality, analysts describe China's model as a hybrid approach that borrows the impact lens from Europe while staying primarily aligned with ISSB. That places it close to the double materiality principle in the role that ESRS and CSRD play in sustainability reporting, so a CSRD-ready materiality assessment gives you a head start.
How to get started: check whether your emissions engine can produce results under both Chinese national methods and the GHG Protocol from the same source data.
The Scope 1, 2 and 3 data requirement
The standard requires Scope 1, 2 and 3 greenhouse gas emissions. Scope 3 covers the full value chain, both upstream and downstream. For most manufacturers, Scope 3 is the hardest figure to produce and the largest share of the footprint.
The reporting gap is wide. A 2024 survey found that about 84% of leading Chinese firms report Scope 1 and 2, but only about 22% report full Scope 3. As the standard tightens, that gap becomes a compliance risk and a data request that lands on suppliers.
European and North American buyers feel this directly. Your Chinese suppliers will need to produce Scope 3 data that meets the standard, and you need the same figures for your own CSRD value-chain reporting. The practical answer is to treat both as one exercise. Our guide to Scope 3 reporting essentials for global and EU standards sets out how to structure that work.
How to get started: rank suppliers by emissions contribution, then collect primary data from the largest first.
How to prepare: one data foundation for multiple regimes
Do not build three reporting systems. Build one dataset that answers China's standard, CSRD, and ISSB. Analysts recommend capturing required information once and deploying it across formats rather than running parallel pipelines. Five steps make that practical.
- Map your obligations. List where you report: Chinese entities under the new standard, the EU under CSRD, and any ISSB jurisdictions.
- Run one converged materiality assessment. Cover both financial and impact materiality once, since all three regimes draw on the same topics.
- Build one audit-grade emissions dataset. Capture Scope 1, 2 and 3, tagged to entity and product, so it can output in each required format.
- Engage suppliers once. Collect primary Scope 3 data through a single supplier process, not a separate request per regulation.
- Reconcile methodology. Produce results under Chinese national standards where required and the GHG Protocol elsewhere, from the same underlying data.
Two manufacturers show the payoff of a single foundation. Signify built a granular Scope 3 baseline at SKU, business unit, and supplier level with carbmee, moving from estimation to data-backed emissions management across more than 70 countries. That baseline underpins a 40% reduction target by 2030. In agriculture, KWS calculated 30,000 supplier carbon footprints and found that its top 50 suppliers drive 55% of Scope 3 emissions, then published EY-audited Scope 3 figures.
carbmee EIS™ builds this single transactional data foundation, and Carbontology™ models the data so it can report to each framework without a rebuild. That is how one calculation serves China, Europe, and the ISSB jurisdictions at once.
How to get started: pick one product line, model it end to end, and test whether the output satisfies all three regimes.
Conclusion
China's climate standard is voluntary now, but it is on a mandatory track and it goes further than ISSB. Three points matter for planning. First, the trial period is the low-cost window to get your data right. Second, double materiality and local methodology mean your existing GHG Protocol inventory is a starting point, not a finished answer. Third, one audit-grade dataset serves the China standard, CSRD, and ISSB, while three separate systems waste budget and invite inconsistency.
The manufacturers who prepare during the trial will report faster, pass audit, and hold supplier data that competitors are still chasing.
See how carbmee helps manufacturers meet overlapping climate rules from a single dataset in our guide to sustainability compliance without compromise.
