The 2026 Transition: From Voluntary Disclosure to Mandatory Standardization
As of December 2025, the Vietnamese stock market stands on the brink of a major regulatory shift. Circular 96/2020/TT-BTC, which served as the foundational guideline for information disclosure for the past five years, will officially expire on January 1, 2026.
It will be replaced by a new, more rigorous regulatory framework (aligning with international standards like IFRS S1 & S2). This marks the end of the “basic compliance” era and the beginning of standardized, data-driven ESG reporting.
Below is the legal roadmap and strategic advisory for listed companies preparing for this critical transition.
1. The Legal Landscape: The “Sunset” of Circular 96
The Turning Point (January 1, 2026)
For the fiscal year 2025 (reports to be published in early 2026), enterprises are facing a pivotal compliance moment.
- Pre-2026 (Under Circular 96): ESG disclosure was integrated into the Annual Report with relatively loose requirements (qualitative descriptions of environmental impact were often sufficient).
- Post-2026 (New Regulation): The replacement regulation is expected to demand Standalone Sustainability Reports or integrated reports with strict adherence to quantitative metrics.
- Implication: The “check-the-box” approach is no longer valid. Regulators will require verifiable data, not just marketing narratives.
The “Gap” Risk
Enterprises that fail to upgrade their data collection systems now (in late 2025) will find themselves legally non-compliant when the new law takes full effect in just a few weeks.
2. The New Standards: Aligning with IFRS S1 & S2
The State Securities Commission (SSC) aims to synchronize Vietnam’s reporting standards with the International Sustainability Standards Board (ISSB).
The New Mandatory Requirements (Projected):
- Quantitative GHG Emissions: Moving from “we try to save energy” to “Scope 1, 2, and 3 emissions measured in tCO2e.”
- Climate-Related Financial Disclosures (TCFD): Companies must quantify how climate change affects their financial position (e.g., risk of asset stranding due to flooding, carbon tax liabilities).
- Independent Assurance: Third-party verification of ESG data will likely shift from “encouraged” to “mandatory” for large-cap (VN30/VN100) companies to combat Greenwashing.
3. Market Forces: Why Compliance Cannot Wait
Even before the new Circular takes effect on Jan 1, 2026, the market has effectively imposed its own sanctions on non-compliant firms:
A. The “Export License” (Supply Chain Pressure)
Major export markets (EU, US) have activated mechanisms like CBAM (Carbon Border Adjustment Mechanism) and EUDR (Deforestation Regulation).
- Reality: Vietnamese manufacturers in global supply chains must provide granular carbon data to their buyers. Failure to report equivalent to international standards means loss of contracts, regardless of domestic law.
B. Capital Access (The “Greenium” Effect)
- Foreign Capital: Funds like Dragon Capital or VinaCapital apply strict ESG screening. Stocks lacking transparent ESG data are excluded from investment portfolios, reducing liquidity.
- Cost of Debt: Banks are offering preferential interest rates (Greenium) for green projects. Without a standardized ESG report to prove eligibility, companies are forced to borrow at higher commercial rates.
4. The “Greenwashing” Liability
With the new regulations taking effect in 2026, the legal risk of Greenwashing (making misleading environmental claims) escalates from a reputational risk to a legal liability.
- Administrative Sanctions: The new framework is expected to introduce specific penalties for misleading ESG disclosures.
- Litigation Risk: As seen globally, shareholders may sue directors for breach of fiduciary duty if “green” claims result in regulatory fines or stock price drops.
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- Khám phá
5. Strategic Action Plan for the Board (BOD)
To successfully navigate the transition to the new 2026 regulations, the Board of Directors must act immediately:
- Data Infrastructure Overhaul: Treat ESG data with the same rigor as Financial data. Implement ERP systems capable of tracking non-financial metrics (energy, waste, safety) in real-time.
- The “Dry Run”: Use the 2025 Annual Report as a “dry run” for the new standards. Attempt to apply the new draft regulations voluntarily to identify data gaps before they become mandatory.
- Capacity Building: The legal and finance teams must be trained on the new Circular and international standards (GRI/IFRS). Relying solely on the PR department is no longer sufficient.
CONCLUSION
The expiration of Circular 96/2020/TT-BTC on January 1, 2026, is not just an administrative update; it is a paradigm shift. It signals that the Vietnamese market is maturing. Listed companies must view ESG reporting not as a compliance burden, but as a strategic tool to secure capital and ensure long-term resilience.
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TLA Law is a leading law firm with a team of highly experienced lawyers specializing in criminal, civil, corporate, marriage and family law, and more. We are committed to providing comprehensive legal support and answering all your legal questions. If you have any further questions, please do not hesitate to contact us.
1. Lawyer Vu Thi Phuong Thanh, Ha Noi Bar Association
Email: vtpthanh@tlalaw.vn
2. Lawyer Tran My Le, Ha Noi Bar Association
Email: tmle@tlalaw.vn
Nguyen Hien Mai