Environmental, social, and governance issues are no longer peripheral concerns for companies operating in Turkey. What was once treated as a voluntary corporate social responsibility narrative has become a legal, reporting, financing, and supply-chain issue with real boardroom consequences. In 2026, the Turkish ESG landscape is being shaped by several converging forces: mandatory sustainability reporting under the Turkish Sustainability Reporting Standards, capital markets disclosure expectations, the new Climate Law, EU-driven trade and value-chain pressures, and increased scrutiny of environmental claims in advertising and public communications. Taken together, these developments show that ESG in Turkey is moving from reputation management to enforceable corporate compliance.
For international investors, listed companies, exporters, large manufacturers, regulated entities, and major suppliers, the key point is that Turkey does not operate through a single standalone “ESG code.” Instead, ESG obligations are emerging through a combination of public oversight rules, sustainability reporting standards, capital markets disclosure requirements, climate regulation, consumer protection rules, and trade-related measures. In practice, this means companies must read sustainability not only as an ethics topic but also as a disclosure, governance, assurance, competition, customs, and contract-management issue.
ESG in Turkey Is Moving from Voluntary Narrative to Structured Disclosure
One of the clearest trends in Turkey is the shift from soft ESG messaging to structured sustainability reporting. The Public Oversight, Accounting and Auditing Standards Authority has made Turkish Sustainability Reporting Standards, known as TSRS, part of Turkish law, and it expressly states that TSRS are the Turkish translation of the ISSB standards and are intended to be internationally comparable. That is a major development because it places Turkish reporting on the same conceptual track as the IFRS sustainability architecture rather than leaving sustainability reporting entirely to informal or self-designed corporate formats.
The practical effect is significant. According to KGK’s official guidance, companies that fall within the relevant categories and exceed at least two of the three thresholds for two consecutive reporting periods, namely TRY 500 million in assets, TRY 1 billion in annual net sales revenue, and 250 employees, are within the mandatory reporting scope. Banks supervised under the Banking Law are treated differently and are generally within scope without being subject to those thresholds. KGK also states that mandatory reporters had to begin reporting for accounting periods starting on 1 January 2024, meaning that their 2024 sustainability activities began to be reported in 2025.
This is not merely a new report to append to the annual filing cycle. KGK explains that the report is structured around four core pillars: governance, strategy, risk management, and metrics and targets. That structure matters because it forces companies to connect sustainability information to board oversight, enterprise risk management, financing conditions, operational resilience, and decision-useful metrics. A Turkish company cannot realistically claim strong ESG compliance in 2026 if it still treats sustainability data as a disconnected public-relations annex.
Another important trend is assurance. KGK states that, with the first mandatory sustainability reports beginning to be published, those reports are also subject to mandatory sustainability assurance. The same body also indicates that, until a Turkey-aligned version of the international sustainability assurance standard is fully in force, existing assurance frameworks such as GDS 3000 and GDS 3410 continue to be used, while work on ISSA 5000-aligned standards has been planned and publicly announced. This means Turkish ESG practice is increasingly moving toward audited, verifiable sustainability information rather than broad narrative claims.
Public Companies Face a Dual ESG Regime
For listed companies and other capital-markets participants, the Turkish ESG picture is even more layered. The Capital Markets Board’s Sustainability Principles Compliance Framework remains highly relevant. SPK materials make clear that the application of the sustainability principles is voluntary in substance, but disclosure on a “comply or explain” basis is mandatory, and the relevant statements must be addressed in annual reports under the Corporate Governance Communiqué. This is a crucial point for issuers: even where a sustainability principle is not strictly mandatory as a conduct rule, silence is not an option.
As a result, many public companies in Turkey now operate under a dual ESG regime. On one side, they face capital-markets disclosure expectations under SPK’s sustainability principles and annual report obligations. On the other, some of them also fall within the mandatory TSRS reporting and assurance regime under KGK. In practice, this is pushing Turkish issuers to align governance committees, internal data collection, investor relations, legal departments, audit functions, and sustainability teams much more closely than before. ESG in Turkey is therefore becoming an interdisciplinary compliance function rather than a standalone communications exercise.
Climate Law Has Turned Climate Compliance into Hard Law
Another defining trend is the enactment of Turkey’s Climate Law. Türkiye’s Second Nationally Determined Contribution and official climate communications confirm that the Climate Law No. 7552 was adopted by the Grand National Assembly on 2 July 2025 and published in the Official Gazette on 9 July 2025. Official materials describe it as Turkey’s first comprehensive climate legislation and a turning point in the country’s climate governance framework.
The legal importance of the Climate Law goes well beyond symbolic alignment with global climate policy. According to official Turkish materials, the law establishes principles such as equality, climate justice, precaution, participation, integration, sustainability, transparency, just transition, and progress. It also provides the legal basis for national mitigation and adaptation policy, clarifies institutional responsibilities, and creates a framework for emissions permits and a national emissions trading system for facilities already operating under monitoring, reporting, and verification structures. Turkish official documents further state that the law covers climate finance, green taxonomy, incentives, technology development, biodiversity protection, and local climate action planning.
For companies, this changes the legal conversation. Climate is no longer relevant only to large emitters or voluntary net-zero pledges. It is now part of the Turkish compliance environment, especially for energy-intensive sectors, industrial operators, exporters, infrastructure players, and businesses with significant financing or public-disclosure exposure. Even where secondary legislation is still developing, the direction is unmistakable: climate-related risk management, carbon accounting, emissions governance, and transition planning are becoming embedded in Turkish corporate compliance.
EU Rules Are Reshaping Turkish Compliance Expectations
No discussion of sustainability compliance in Turkey is complete without the European Union effect. Turkish companies do not need to be incorporated in the EU for EU sustainability rules to matter. If they export into the EU, supply EU-regulated groups, manufacture covered products, or serve as part of an EU buyer’s value chain, they increasingly face contract-driven and market-driven sustainability demands.
The strongest immediate example is the Carbon Border Adjustment Mechanism. The European Commission states that CBAM entered its definitive regime from 1 January 2026 after the 2023–2025 transitional phase. That development is particularly important for Turkish exporters because it ties decarbonization, emissions data, and carbon cost exposure directly to continued competitiveness in the EU market. Turkish official materials have also repeatedly connected Turkey’s green transition agenda to CBAM preparation.
The wider European sustainability regime also matters. The European Commission explains that the first companies subject to the CSRD had to apply the new rules for the 2024 financial year in reports published in 2025, while the Council of the EU gave final approval in February 2026 to simplification changes affecting CSRD and due-diligence requirements. The Commission also notes that the Corporate Sustainability Due Diligence Directive entered into force in July 2024 and is aimed at requiring in-scope companies to address adverse environmental and human-rights impacts across their operations and value chains. Even though these are EU rules, Turkish suppliers are already feeling their downstream effect through questionnaires, supplier codes, audit rights, emissions requests, and contractual compliance clauses.
For Turkish businesses, the practical implication is simple. A company may not be directly regulated by Brussels and still find that ESG non-compliance costs it financing, customer retention, tender eligibility, or access to European buyers. This is why many Turkey-based companies are building systems for supplier due diligence, Scope 1 and Scope 2 emissions measurement, anti-forced-labor assurances, grievance channels, policy libraries, and board-level sustainability oversight before a direct Turkish sectoral obligation formally compels each step.
Green Finance and Capital Markets Are Expanding ESG Discipline
A further corporate compliance trend in Turkey is the growth of sustainable finance. SPK’s sustainability materials confirm the existence of green debt instrument and green lease certificate guidance, designed to align issuances with international sustainable finance principles. SPK has also continued to discuss updated guidance for green, sustainable, social, and sustainability-linked capital-markets instruments, showing that the Turkish capital markets framework is progressively expanding beyond traditional governance disclosure toward transaction-level sustainable finance architecture.
At the market infrastructure level, Borsa İstanbul continues to integrate sustainability into capital-markets visibility. Borsa İstanbul states that its sustainability indices are intended to help companies compare sustainability performance, improve transparency and accountability, and strengthen risk-management capabilities regarding sustainability issues. Borsa İstanbul also announced in April 2026 that the LSEG sustainability methodology used for BIST Sustainability Indices was under revision, with both old and new scores being published during the transition. That shows ESG metrics in Turkey are not static; they are becoming more sophisticated and increasingly tied to internationally recognized evaluation systems.
This trend matters for issuers and borrowers alike. Once sustainability affects bond frameworks, investor engagement, index inclusion, and external scoring methodologies, legal risk expands beyond regulatory filings. Companies must then ensure consistency across offering documents, annual reports, sustainability reports, website disclosures, and investor presentations. In that environment, any mismatch between what a company says in capital markets and what it can evidence operationally becomes a potential legal and reputational liability.
Greenwashing Is Now a Real Compliance Risk in Turkey
A major legal trend that companies should not underestimate is greenwashing enforcement. The Turkish Ministry of Trade has publicly stated that advertisers have been using environmental claims in ways that exploit consumers’ lack of information and that the Ministry is actively working to prevent misleading practices commonly described as greenwashing. Turkey also has a specific Guideline on Advertisements Containing Environmental Claims, prepared under consumer-protection and advertising rules.
This has serious implications for ESG communications. Companies often assume that sustainability risk lies mainly in under-disclosure. In reality, overstatement can be just as dangerous. Broad claims such as “eco-friendly,” “green,” “sustainable,” “carbon neutral,” or “climate friendly” may create exposure if the claim is vague, unqualified, unverifiable, or presented without the conditions necessary to understand its scope. In Turkey, that risk is particularly relevant for consumer-facing sectors, retail, textiles, packaged goods, automotive, cosmetics, and any business using environmental branding in digital marketing or labels.
For corporate compliance teams, the lesson is clear: ESG communications need legal review. Sustainability reports, website statements, product packaging, marketing campaigns, investor decks, and procurement presentations must be checked not only for tone but also for substantiation. A company that invests heavily in sustainability but communicates carelessly can still face legal risk under consumer and advertising rules.
Assurance, Competence, and Documentation Are Becoming Central
Another strong trend in Turkey is professionalization. KGK has publicly announced sustainability-related examinations, sustainability auditor pathways, and the licensing process for Corporate Sustainability Reporting Experts. Official KGK materials also show that sustainability assurance standards and reporting expertise are becoming institutionalized fields rather than ad hoc advisory topics. This suggests that Turkish regulators increasingly expect sustainability information to be prepared and reviewed by qualified professionals within structured systems.
This is highly relevant from a legal-risk perspective. Once sustainability reporting becomes subject to mandatory scope rules, assurance standards, and licensed expertise, informal spreadsheet-based reporting is no longer enough. Companies need defensible internal controls for emissions calculations, energy and waste data, supplier information, labor metrics, incident tracking, policy ownership, and board approval records. In Turkish practice, the companies best prepared for ESG scrutiny are usually not those with the most ambitious slogans, but those with the strongest documentation trail.
What Companies Should Do Now
The most effective response to ESG and sustainability trends in Turkey is to treat them as a governance project rather than a one-off reporting task. Boards and senior management should first determine whether the company falls within mandatory TSRS scope, capital-markets disclosure obligations, climate-regulated sectors, or EU-facing supply chains. They should then identify which sustainability statements are already being made in annual reports, bond documents, contracts, procurement platforms, advertisements, or tender submissions. Only after that mapping exercise can the company safely design its internal ESG control framework.
A sound Turkey-specific compliance program should include board-level oversight, clear internal responsibility lines, documented data-collection procedures, legal review of environmental claims, preparation for assurance, and contract-level management of supplier sustainability commitments. Exporters and multinational groups should also align Turkish operations with EU-driven customer requests relating to emissions, human-rights due diligence, and transition metrics, even where Turkish law does not yet impose an identical obligation in the same form. In 2026, that level of preparation is no longer excessive. It is commercially prudent.
Conclusion
ESG, sustainability, and corporate compliance trends in Turkey are now unmistakably moving toward formalization, verification, and integration with mainstream corporate law practice. Mandatory TSRS reporting, sustainability assurance, SPK disclosure expectations, the Climate Law, CBAM, sustainable finance guidance, and greenwashing enforcement all point in the same direction: sustainability is becoming part of how companies are governed, financed, audited, and judged in the market.
For companies operating in Turkey, the winning approach is not to wait for every detail to become mandatory. The better approach is to build a credible, evidence-based, Turkey-specific ESG compliance system now. Businesses that do so will be better positioned for investor scrutiny, trade resilience, regulatory change, and long-term enterprise value. Those that do not may find that sustainability risk arrives first not as ideology, but as reporting failure, contractual pressure, financing friction, or misleading-claims liability.
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