Outlook 2026: Contributors examine how litigation, regulatory divergence, NGO action and evolving trade dynamics are reshaping business and human rights obligations worldwide in 2026.
Forward Law Review asked leading practitioners to explore how human rights and supply chain regulation are fragmenting across jurisdictions, with companies facing mounting pressure to manage forced labour risk, traceability, disclosure and enforcement exposure on a global basis.
Here are their predictions for 2026.
Lucy Blake, partner at Jenner & Block and co-chair of the human rights and global strategy practice, London; and Joshua Kell, associate, London:
2025 was a year of recalibration for ESG and business and human rights around the world. ESG and, in particular, sustainability has become an increasingly controversial subject, especially in the US. Many companies started the year trapped between a rock and a hard place, with obligations in the EU in conflict with risks in the US. However, Q4 2025 saw political compromise and negotiations in the EU slow progress on the ESG legislation, underlining how fragmented the ESG agenda remains. Companies have been left navigating partial reforms, with many left unsure whether they fall within the scope of the framework and, if so, what is actually required.
However, whilst there remains uncertainty around compliance requirements, there is still a clear underlying pressure on businesses to address adverse human rights and climate risks in their operations and supply chains. Companies face the threat of litigation and reputational damage for adverse impacts. They are also required to provide transparency to their investors, customers and vendors, with failure to do so potentially resulting in loss of business or funding.
Whilst the unpredictability of the current climate may tempt corporates to hedge their bets, companies that invest now in mapping and supplier engagement will be best placed to deal with regulatory change and demonstrate that taking a responsible approach to business continues also to make good commercial sense.
Sharon Singh, partner and co-head of the indigenous and environment practice at McMillan, Vancouver:
Supply chain ESG risks in Canada are under the spotlight in 2026, driven by new legislation like the Modern Slavery Act and proposed human rights due diligence requirements. Companies must report on efforts to prevent forced and child labour, with directors personally liable for non-compliance. Geopolitical disruptions and enforcement actions are prompting businesses to scrutinize supply chain partners for human rights and emissions data.
Voluntary Scope 3 GHG reporting is gaining traction, increasing pressure for transparency throughout the value chain. Enhanced due diligence and partner selection processes are essential to address regulatory, reputational, and operational risks.
Hannah Edmonds-Camara, special counsel in the global business & human rights team, Covington, London:
The business and human rights landscape is set to continue evolving in 2026. As companies consider responsibility, risk, and opportunity in the year ahead, this article highlights areas of continued focus and emerging trends.
Preparation for incoming regulatory regimes
As the number and variety of human rights-related legal regimes increases, companies must monitor and adapt to a range of legal requirements, including reporting, due diligence and forced labour product ban-related obligations.
In the EU in particular, several human rights-related laws are forthcoming, including the (reformed) Corporate Sustainability Reporting Directive and the Corporate Sustainability Due Diligence Directive, the Deforestation Regulation, the Batteries Regulation, and the Forced Labour Regulation. There is also movement in other jurisdictions such as Australia, South Korea, Thailand and the UK.
Continued focus on forced labour in supply chains
Governments continue to focus on addressing the risk of forced labour in supply chains. For example:
In the US, which pioneered the implementation of a forced labour import ban regime, recent statements from the administration, continued enforcement activity, and the integration of forced labour provisions into new US trade agreements reinforce the ongoing commitment to combatting forced labour in supply chains.
In December 2025, the UK’s Independent Anti-Slavery Commissioner (“IASC”) proposed new human rights due diligence legislation that includes (among other reforms): (i) a “failure to prevent” offence that establishes liability for an in-scope company’s failure to prevent serious human rights harms caused by, connected with or linked to the company’s operations, products or service; and (ii) a forced labour product ban. The impact of the IASC’s proposal remains to be seen.
Navigating downstream human rights risks
There is a growing expectation that companies should identify and respond to human rights risks not only in their “upstream” supply chain, but also those related to the use of their products and services (so called “downstream” risks). This has long been a concern of stakeholders such as civil society, but is now also being integrated into evolving regulation, and subject to investor scrutiny.
Although this has been a focus in the technology sector (particularly with the development and deployment of AI), other sectors have also come under scrutiny (for example, defence and telecommunications companies). In 2026, we expect further focus on how risk assessments, responsible product design, contractual safeguards, and meaningful stakeholder engagement may prevent product/service misuse that results in adverse human rights impacts.
Monitoring multi-pronged, multi-jurisdictional human rights campaigns
Civil society continues to pursue corporate accountability campaigns involving action in multiple venues and/or in multiple jurisdictions. Avenues for such action include actions before domestic courts and regulators, use of non-judicial grievance mechanisms (such as the OECD NCP Specific Instance process), in-depth public reporting, and strategic advocacy. As NGOs explore new and evolving strategies (including novel litigation arguments and creative use of pre-existing enforcement tools, etc), it will be important to monitor how the enforcement environment develops in response to these campaigns.
Consolidating compliance efforts
In response to this highly complex legal and quasi-legal landscape, we anticipate that companies will focus through 2026 on developing comprehensive, coordinated, and cohesive multi-jurisdictional human rights strategies that are global in approach. This might involve:
- reviewing the strength of existing human rights due diligence processes against the range of incoming regulations;
- developing cross-functional management of human rights risk;
- identifying ways to leverage existing compliance frameworks to ensure appropriate cross-jurisdictional and cross-issue risk management, rather than addressing regulations and issues in silo; and
- considering alignment between due diligence practices and public disclosures on human rights, including in modern slavery and sustainability statements.
Quinton Newcomb, partner at Fieldfisher, London:
In 2026, ESG-related litigation will continue to surge, following the landmark Court of Appeal decision in the World Uyghur Congress case and the growing influence of Global Legal Action Network (GLAN) notices.
The Court clarified that goods purchased through forced labour can constitute criminal property for the purposes of the Proceeds of Crime Act 2002, and thus, handling such goods can amount to money laundering. Further, the case illustrated that ESG violations such as environmental crimes or human rights abuses go far beyond reputational harm, creating criminal exposure for organisations.
With this ruling, combined with activist NGOs, and conceivably, even competitors, issuing formal notices and publishing reports that identify ESG violations in corporate supply chains, businesses face increased exposure to money laundering offences via the identification doctrine, if the violations are not immediately addressed. In this context, ESG compliance will become a key aspect of financial crime prevention efforts in 2026.
Ruth Knox, partner and chair of ESG & sustainable finance at Paul Hastings, London:
The rollback of ESG regulation has been less pronounced in relation to supply chains, reflecting continued strategic alignment across both sides of the Atlantic around resilience, transparency and diligence.
We are seeing sustained interest from sponsors in businesses providing supply chain diligence and risk management services. That interest is driven not only by human rights considerations, but also by trade dynamics, geopolitical risk and the need to protect market access.
As a result, supply chain due diligence is increasingly viewed as a commercial and trade issue as much as a compliance obligation, with long-term relevance regardless of broader ESG regulatory recalibration.
Joshua Domb, partner, Gen-R Law, London:
I expect 2026 will be a big year for human rights focused litigation, with claimants taking confidence from the ongoing Dyson litigation in the UK to bring claims for alleged violations of their human rights in the jurisdiction where the benefit was allegedly obtained, rather than the jurisdiction where their rights were allegedly violated. In the Dyson case, migrant workers who allegedly suffered human rights abuses whilst working at factories in Malaysia that supplied Dyson are seeking compensation against Dyson directly in the UK. The fact that Dyson did not own or control the factories in question has not stopped the claim from being given permission to proceed.
I also expect to see more competition authorities using their consumer protection powers in a human rights context, where they are concerned that brands have been advertising products as ‘responsibly produced’ (or equivalent), only for investigations to identify serious concerns about human rights abuses in the brand’s supply chain. It cost Dior 2 million euros to settle an investigation of this nature with the Italian competition authorities in May 2025. Other competition authorities will have noted this success with interest.