Vietnam

YEAR IN REVIEW

(1 July 2024 to 30 June 2025)

Vietnam has expanded the list of facilities which must conduct GHG inventory and develop a GHG reduction plan.
Vietnam has issued further regulations to establish a mandatory ETS and voluntary carbon market. An ETS will be launched in the second half of 2025 for certain high-emitting sectors.
There has been increasing sustainable financing deals (accompanied by independent assurance).

Scroll down or click below for further information on each key theme.

PODCAST OVERVIEW

Please click on the podcast above for a snapshot of the three key themes of ESG reporting, transition planning and greenwashing risks in respect of Vietnam.

KEY CONTACTS

	Quang Nhat Truong Managing Partner, YKVN
	Krissen Pillay Counsel, YKVN

A. ESG Reporting

1. Are there legal or regulatory requirements for companies to make ESG disclosures in your jurisdiction?

Yes. ESG disclosures are governed by legislation applicable to specific regimes, principally environmental laws and corporate governance laws.

2. What are the key legislative and regulatory sources for ESG disclosure requirements and to whom do they apply?

Circular 96 requires that certain companies make public disclosures in respect of the environment and society, including in connection with GHG emissions, resource management, energy consumption, water consumption, compliance with laws on environmental protection, policies related to employees and responsibility to the local community.^[1]

These disclosures are essentially imposed on public companies (whether listed or not), companies that publicly offer or have corporate bonds listed and securities companies.

Decree 47 requires state-owned enterprises to publicly report on the performance of public interest tasks assigned to them (in terms of a plan or bidding), including the following information:^[2]

responsibility for environmental protection;
responsibility to contribute to the social community;
responsibility to suppliers;
responsibility to ensure the interests and safety of consumers; and
responsibility to ensure benefits of employees in the enterprise.

Decree 08 requires companies that issue green bonds to make annual public disclosures on the assessment results of environmental benefits of projects that use capital raised from the issuance of green bonds.^[3]

[1] Circular No. 96/2020/TT-BTC (Ministry of Finance, 11 November 2020) provides guidelines on the disclosure of information on the securities market, as amended and supplemented in 2024, 2025 (Circular 96), Appendix IV.

[2] Decree No. 47/2021/ND-CP (Government, 1 April 2021) elaborates on some articles of the law on enterprises, as amended and supplemented in 2023 (Decree 47), Form No. 4 in Appendix II.

[3] Decree No. 08/2022/ND-CP (Government, 10 January 2022) on elaboration of several articles of the Law on Environmental protection, as amended and supplemented in 2023 and 2025 (Decree 08), Article 157.6(a).

3. Are the requirements mandatory or do they apply on a comply-or-explain basis?

Circular 96, Decree 08 and Decree 47 mentioned above are all mandatory.

4. Which aspects of ESG do the requirements focus upon?

Circular 96 has a general focus on corporate governance, with specific categories skewed more towards environmental than social aspects. Decree 47 has a significant focus on social responsibility, whilst Decree 08 focuses on environmental aspects (i.e., the green projects funded by the green bonds).

5. Are the disclosure requirements based on international standards? If so, which one(s)?

The following international standards are common frameworks that have influenced Vietnam’s sustainability reporting requirements as well as relevant guiding documents to varying degrees (though IFRS S1 and IFRS S2 are not featured):

GRI Standards;
International Finance Corporation;
International Integrated Reporting Council;
ISO 26000:2010; and
SASB standards.

In October 2024, the State Security Commission of Vietnam, in collaboration with other organisations, launched the “ESG Handbook” which provides voluntary guidance and reference materials for Vietnamese enterprises on integrating ESG into corporate governance and enhancing sustainability disclosures.^[1]The ESG Handbook recommends international standards, including TCFD, UN Sustainable Development Goals and the EU’s European Sustainability Reporting Standards.^[2]

[1] https://ssc.gov.vn/webcenter/portal/ubck/pages_r/l/chitit?dDocName=APPSSCGOVVN1620148612.

[2] A set of detailed sustainability reporting requirements adopted by the European Union to support the implementation of the Corporate Sustainability Reporting Directive.

6. How do the disclosure requirements approach materiality (e.g. single or double materiality)?

The current regulations of Vietnam (through Circular 96, Decree 08 and Decree 47) can be viewed as adopting an impact materiality approach with certain elements of double materiality.

7. Are there requirements for the disclosure of GHG emissions? If so, please specify the scope (e.g. Scope 1, Scope 2 and/or Scope 3), to whom they apply and whether there are requirements on the measurement methodology.

GHG-emitting establishments are specified in lists issued by the Prime Minister (Specified Establishments) and categorised by sector.^[1] The list of establishments was initially issued in 2022 and most recently expanded in August 2024. These establishments are heavy emitters in sectors such as energy, transportation, construction, industrial processes, agriculture, forestry and waste.

The Specified Establishments are subject to biennial GHG inventory reporting, which requires them to report on their GHG inventory method, operation figures and emissions at the facility-level. The requirement to establish GHG inventory reports first applied with a deadline of 31 March 2025 (for reporting period calendar year 2024) and thereafter reporting will be required every two years. There are currently 2166 Specified Establishments.

Although the list of Specified Establishments is publicly available, this is not the case for the disclosure of GHG emissions. The government is meant to report GHG inventory at a national and sector level through the websites of climate change and sector authorities,^[2]though these announcements have not yet been made.

Circular 96 (described in section A.2 above) imposes public disclosure requirements in respect of GHG emissions, being total direct and indirect GHG emissions and measures and initiatives to reduce GHG emissions.

[1] Decision No. 13/2024/QD-TTg (Government, 13 August 2024) on the lists of sectors and GHG emitting facilities required to develop GHG inventory (updated) (Decision 13)

[2] Decree No. 06/2022/ND-CP (Government, 7 January 2022) providing regulations on greenhouse gas emission reduction and ozone layer protection, as amended and supplemented by Decree No. 119/2025/ND-CP (Government, 9 June 2025) (Decree 119) (Decree 06), Article 11.1(dd).

8. Are there requirements to obtain independent assurance of any ESG disclosures? If so, what is the scope of such requirements? If not, are there plans to introduce such requirements?

No, there are no such regulatory requirements. However, some companies obtain independent assurance (likely due to contractual undertakings).

9. For companies not subject to mandatory or comply-or-explain ESG reporting, are voluntary ESG disclosures customary?

No. However, there have been a few recent instances of issuers of sustainable bonds and borrowers of sustainable financing making voluntary public ESG disclosures.

For example, the voluntary Sustainable Finance Framework of Vietnam Prosperity Joint Stock Commercial Bank (VPBank) was evaluated by Sustainalytics in 2024 and, following this independent assurance, in May 2025 VPBank announced a landmark international syndicated loan transaction with an initial value of US$1 billion.^[1]

A&A Green Phoenix Group Joint Stock Company (Phenikaa) had its Sustainable Finance Framework evaluated by Sustainable Fitch in November 2024 and issued VND 520 billion in dual-tranche sustainability-linked bonds.

YKVN was involved in both of these transactions and we expect an increasing role for independent assurance (second opinion) as ESG financing grows.

[1] https://vir.com.vn/vpbank-secures-record-1-billion-sustainable-syndicated-loan-127772.html

10. Has your jurisdiction issued or adopted a taxonomy on sustainable activities? Is it mandatory and what is its scope of application?

No. In broad terms, there is no taxonomy regime in respect of ESG. However, numerous actors such as the GIZ Macroeconomic Reforms/Green Growth Programme and the Institute of Strategy and Policy on Natural Resources and Environment have been calling for the development of a local taxonomy. The ASEAN Taxonomy for Sustainable Finance may be used by enterprises for their voluntary disclosures or be used for sustainable finance products.

11. Are there plans to adopt or incorporate any (other) international ESG reporting framework (e.g. the ISSB Standards and/or the TNFD)? If so, please give details.

There is no indication that the ISSB Standards or other international ESG reporting frameworks will be adopted. There has been no formal indication by regulators that reports prepared in compliance with IFRS S1 and IFRS S2 will result in compliance with local disclosure requirements.

12. Other upcoming developments / direction of travel

It is expected that reporting will be impacted by the general trajectory of the State and market participants towards achieving ESG goals and encouraging broader ESG participation and disclosure.

External influences include Vietnam’s foreign trade and investment partners. An example of this, from a trade perspective, is the fairly recent EU-Vietnam Free Trade Agreement, which encourages trade between the EU and Vietnam. As a result, disclosure requirements imposed on EU entities would be expected to have an impact on disclosures by their Vietnamese trading partners / exporters, at least to the relevant EU company if not publicly or to any authority.

The EU’s CBAM is expected to have a similar effect on exporters of certain goods to the EU.

We therefore expect foreign importers, investors and financiers to impose requirements on Vietnamese companies to disclose certain emissions and other data. This has the potential to impact the local market.

Vietnam published a National Action Plan for Law and Policy Improvement to Promote Responsible Business Practices in Vietnam in July 2023.^[1]The plan outlines actions to improve policies and laws on labour, the protection of the rights of vulnerable groups, environmental protection and consumer protection. There is no proposal to introduce an environmental due diligence law.

[1] Decision No. 843/QĐ-TTg (Prime Minister, July 14, 2023) on issuance of the national action plan on improving policies and laws to promote responsible business practices in Vietnam for the period 2023–2027.

Back to homepage

B. Transition Planning

1. Has your jurisdiction set decarbonisation targets and strategies?

Yes. At the 26th United Nations Climate Change Conference of the Parties in December 2021, Vietnam set a goal of achieving net zero emissions by 2050.

Various efforts have been undertaken by the government to achieve this and, notably, in July 2022 the government issued the National Climate Change Strategy to 2050, under Decision No. 896/QD-TTg dated 26 July 2022 of the Prime Minister, which sets out as a general target that Vietnam will reduce GHG emissions under the goal of net zero emissions by 2050. The specific goals include ensuring that:

by 2030, total national GHG emissions are reduced by 43.5%;
by 2035, emissions peak will be reached; and
by 2050, total national GHG emissions reach a net zero emissions increase.

The National Climate Change Strategy to 2050 sets out the strategies for reducing GHG emissions for each sector. For example, the energy sector promotes clean energy development, economical and efficient energy usage and the agriculture sector applies emission reduction measures through technological innovations in crop cultivation and livestock farming. Subsequently, a series of programs and action plans for specific sectors were issued to concretise the national strategy, including Decision No. 876/QD-TTg for the transportation sector^[1] and Decision No. 266/QD-TTg for the energy sector.^[2]

The Vietnamese government has also developed Amended Power Development Plan 8 (Amended PDP8) which aims to foster renewable energy projects and reduce GHG emissions. Under Amended PDP8, Vietnam sets a goal, among others, of reducing GHGs caused by electricity production to about 197 – 199 million tonnes from 2030, and to about 27 million tonnes from 2050. Further, the electricity generation sector must prioritise the construction of projects contributing to reducing GHGs (e.g., biomass, electricity produced from trash, solid waste and cogeneration).^[3]

In respect of GHG emissions, in 2023, the Ministry of Industry and Trade issued Decision No. 947/QD-BCT on approving the Annual Plan for Implementation of Vietnam’s Low Emission Energy Program II, aiming to, among other objectives, reduce GHG emissions in the energy and industrial sectors.^[4]

[1] Decision No. 876/QD-TTg (Prime Minister, 22 July, 2022) approving the action program for transition to green energy and mitigation of carbon dioxide and methane emissions from transportation.

[2] Decision No. 266/QĐ-TTg (Prime Minister, 12 February 2025) on promulgation of the action plan for implementing the global declaration on coal-to-clean energy transition.

[3] Amended PDP8, Sections II.2(b) and V.1.

[4] Decision No. 947/QD-BCT (the Ministry of Industry and Trade, 18 April 2023) on approving Annual Plan (October 2022 – September 2023) for Implementation of Vietnam Low Emission Energy Program II.

2. Are businesses subject to any mandatory carbon pricing or other “polluter pays” instruments (such as ETS, carbon taxes or EPR schemes)? If so, please give details. If not, are there plans to do so?

Carbon pricing

Vietnam is in the process of implementing a mandatory ETS and voluntary domestic carbon market. It is applying the following roadmap and timeline (initially issued in 2022 and amended and supplemented in 2025):^[1]

Current until the end of 2027: finalise the regulatory framework regarding the Carbon Trading Exchange (CTX); pilot carbon credit exchange and offsetting mechanisms in potential sectors; establish and pilot the operation of the CTX for certain high-emitting sectors from June 2025;
Current until the end of 2028: establish a national registry system; deploy the domestic carbon credit exchanging and offsetting mechanism; conduct awareness-raising activities on carbon market development;
From 2028 onwards: officially operate the CTX in 2028; and
From 2029 onwards: develop and implement an auction mechanism for GHG emissions quotas.

To implement the first phase of the roadmap, Vietnamese authorities issued, among others, two key legal documents on the carbon market in January and June 2025, respectively: (i) the “Scheme for Establishing and Developing a Carbon Market in Vietnam”^[2] issued by the Prime Minister, and (ii) Decree No. 119/2025/ND-CP^[3] issued by the government. Consequently, there will be two categories of tradable instruments: (i) GHG emissions quotas (through free allocation and auction methods)^[4], and (ii) carbon credits.^[5]

GHG emissions quotas will be determined based on statutory methods and allocated to each Specified Establishment (as defined in Section A.7) by the Prime Minister and the Ministry of Agriculture and Environment (MOAE). In the initial phase, quotas will be allocated to the thermal power, iron and steel sectors.^[6] Specifically, one unit of emission quota represents the right to emit one ton of CO₂ or CO₂-equivalent.^[7] Specified Establishments that exceed their allocated quota may be subject to administrative penalties. In addition, the amount of GHG emissions exceeding the GHG emission quotas allocated will be deducted from the next period’s allocation. Specified Establishments may use carbon credits from certain projects under the carbon credit exchange and offset mechanisms to offset GHG emissions. However, the use of carbon credits for offsetting must not exceed 30% of the allocated GHG emission quotas.^[8]

In parallel, carbon credits may be traded by organisations implementing projects under recognised domestic or international carbon credit exchange or offsetting mechanisms.^[9] Both GHG emissions quotas and carbon credits will be traded on the CTX established and operated by the Hanoi Stock Exchange (HNX).^[10] In addition to the CTX operated by HNX, a separate carbon credit trading platform will also be developed and managed by the International Financial Centre of Vietnam. This initiative—Vietnam’s latest effort to attract investment and enhance its global financial presence—aims to promote (among others) green financing amid rising economic uncertainties.^[11]

In conclusion, Vietnam’s ETS is still in its early stages of implementation. While the system is operational in law, actual trading has not commenced pending the publication of quota allocation lists and the establishment of the national registry system.

As of July 2025, Vietnam has not introduced nor proposed a carbon tax.

EPR schemes

Local environmental protection laws include EPR-related provisions. As a general principle, entities and individuals benefiting from the environment must contribute financially to environmental protection activities, while those causing pollution or degradation are liable for costs, compensation, remediation and other legal responsibilities.^[12] This is detailed in the Law on Environmental Protection and related guiding documents, particularly through provisions on the responsibilities of producers and importers in respect of recycling, waste collection and treatment.

Producers and importers of recyclable products (batteries and accumulators; lubricating oils; inner tubes and tires; electrical and electronic equipment; and transportation vehicles)^[13] and recyclable commercial packaging of food, cosmetics, medicine, fertilisers, cleaning agents and cement^[14] are required to either: (a) recycle either their own or another party’s equivalent product or packaging (at a volume based on the mandatory recycling rate, calculated from, among others, the total weight of all recyclable products/ commercial packaging that they place in the market^[15]), or (b) make a contribution to the Vietnam Environment Protection Fund.^[16] Those enterprises dealing with hazardous or hard-to-recycle items must make financial contributions to waste treatment activities.^[17]

As EPR-related provisions are spread across various legal documents, this has made it difficult for businesses to access and comply with the regulations. To address this, in May 2025, the government initiated the development of a standalone decree to consolidate and harmonise all EPR regulations. One of the key highlights of the draft decree is the clear stipulation of two options for businesses to fulfil their recycling obligations: first, enterprises may organise recycling activities themselves; and second, if they do not recycle directly, they must make financial contributions to the Vietnam Environment Protection Fund. The scope of products and packaging remains the same as existing provisions under the draft decree.

[1] Decree 06, Article 17.

[2] Decision No. 232/QĐ-TTg dated 9 January 2025 of the Prime Minister approving the “Scheme for Establishing and Developing a Carbon Market in Vietnam”. (Decision 232)

[3] Decree No. 119/2025/ND-CP (Government, 9 June 2025) on amendments to certain Articles of Decree No. 06/2022/ND-CP dated January 07, 2022 of the Government on GHG emission mitigation and ozone layer protection.

[4] Decision 232, Article 1, Section III.1(a).

[5] Decision 232, Article 1, Section III.1.

[6] Decree 06, Article 12.1.

[7] Decree 06, Article 19.1(a).

[8] Decree 06, Article 19.8(a).

[9] Decision 232, Article 1, Section III.1(b).

[10] Decision 232, Article 1, Section III.4(a).

[11] Resolution No. 222/2025/NQ-QH (National Assembly, 27 June 2025) on the International Financial Centre of Vietnam (which will become effective on 1 September 2025), Article 13.2.

[12] Law on Environmental Protection No. 72/2020/QH14 (National Assembly, 17 November 2020), as amended on 14 November 2022 (Law on Environmental Protection), Article 4.6.

[13] Decree 08, Article 77.1, Annex XXII.

[14] Decree 08, Article 77.2.

[15] Decree 08, Article 78.

[16] Law on Environmental Protection, Article 54.2.

[17] Law on Environmental Protection, Articles 54 and 55.

3. Are there mandatory requirements for companies to have in place and/or disclose climate-related transition plans? If so, please give details. If not, are there plans for such requirements?

The Law on Environmental Protection^[1] requires Specified Establishments (as mentioned in section A.7) to: (a) formulate and implement annual GHG emissions reduction plans at the facility-level (GHG Reduction Plans) by reference to GHG emissions quotas which will be set by MOAE); and (b) integrate GHG emissions reduction activities with quality management programs, cleaner production programs and environmental protection programs. There are applicable standards and guidance (not requiring social impact assessments).

A GHG Reduction Plan must be formulated according to a statutory form, including^[2] (i) GHG inventory results of facilities of the latest year; (ii) estimated GHG emissions in the planning period without application of technology and measures for GHG emissions reduction; (iii) the objective of GHG emissions mitigation of each year in the period from 2026 to 2030; (iv) chosen measures for GHG emissions reduction that are suitable for the actual situation, technological situation, and available resources of the establishments; and (v) a plan for monitoring the implementation of the GHG Reduction Plan. The first GHG Reduction Plan must cover the period from 2026 to 2030, be submitted by 31 December 2025, and be adjusted and updated annually (if applicable).^[3]

There are currently no penalties promulgated for a Specified Establishment’s failure to follow the measures or meet the targets set out in its GHG Reduction Plan, but it will be subject to the GHG emissions quotas in due course.

For public (and certain other) companies, the annual report required under Circular 96 (see section A.2 above) contains certain disclosure requirements on initiatives to reduce GHG emissions.

Furthermore, enterprises that manufacture products containing or using ozone-depleting substances and/or controlled greenhouse effect substances (as identified by the government) are obliged to develop an appropriate roadmap to replace and eliminate such substances (in accordance with treaties to which Vietnam is a party).^[4]

[1] Law on Environmental Protection, Article 91.7.

[2] Decree 06, Article 13.5

[3] Decree 06, Article 13.4

[4] Law on Environmental Protection, Articles 92.3(b) and 92.5.

4. Are there mandatory requirements to set, meet and/or disclose climate-related targets? If so, please give details. If not, are there plans for such requirements?

Yes, see section B.3 above for mandatory requirements for Specified Establishments to formulate and implement a GHG Reduction Plan in accordance with their respective allocated GHG emissions quotas, which will require such establishments to set GHG reduction targets. Specific quotas will be set from 2026 onwards.

5. Other upcoming developments / direction of travel

Vietnam’s approach is to encourage investment into greenfield and brownfield projects that are in transformative technologies resulting in low GHG emissions as well as encouraging participation in mechanisms and modes of cooperation on lowering GHG emissions.

For private enterprises specialising in sustainable development (i.e., the circular economy model and inclusive business model), Vietnam has developed a program of mechanisms and support in terms of technology, intellectual property, digital transformation solutions and finance.^[1] Specifically regarding financial support, competent Vietnamese authorities will research and develop financial and credit products and services for these enterprises as well as launch an information platform connecting sustainable enterprises with credit institutions and investors.^[2] In February 2025, the Ministry of Finance issued Circular No. 09/2025/TT-BTC^[3] to provide guidance on the mechanism for the management and use of state budget funds for, among others, programs supporting sustainable business enterprises as mentioned above. It is expected that sustainable enterprises will be entitled to certain incentives in raising capital for their sustainable projects and business activities, though financial support has only been planned for the initial period of 2022 – 2025 with further support subject to future policy. Although there is, admittedly, a lack of clarity in practice, this illustrates a positive intention and we expect refinement of this.

Apart from the State, market participants have been placing increased focus on ESG with media attention on those companies making positive strides. There is a growing corporate culture of setting ESG goals.

External influence by way of Vietnam’s trading and investment partners will increasingly affect the local market, driven by requirements of their home jurisdiction as well as voluntary positions adopted. Foreign investors are placing greater emphasis on investee companies transitioning.

[1] Circular No. 13/2023/TT-BKHDT (Ministry of Planning and Investment, 12 December 2023) guiding the Program to support private enterprise for sustainable business in the period 2022 – 2025 (Circular 13), Articles 12, 13 and 14.

[2] Circular 13, Article 11.

[3] Circular No. 09/2025/TT-BTC (Ministry of Finance, 28 February 2025) on guidance on the mechanism for management and use of state budget funds for the implementation of the “Support Program for Private Sector Enterprises in Sustainable Business for the 2022–2025 Period” issued together with Decision No. 167/QD-TTg dated 08 February 2022 of the Prime Minister.

Back to homepage

C. Greenwashing Risks

1. Are there any recent examples of legal proceedings, regulatory actions or investigations against or into greenwashing in your jurisdiction?

No. There have, in the past, been incidents of greenwashing which had sparked public anger. However, there have not been any recent direct proceedings or regulatory enforcement actions.

2. Are there any laws or regulations specifically dealing with greenwashing?

Vietnam has not adopted laws or regulations specifically dealing with greenwashing, though the Law on Competition,^[1] Law on Advertising,^[2] Law on Protection of Consumer’s Benefits,^[3] Law on Securities^[4] and the Penal Code^[5] regulate false information about products or the enterprise itself. The Civil Code^[6] allows for claims by those suffering harm.

[1] Law on Competition No. 23/2018/QH14 (National Assembly, 12 June 2018).

[2] Law on Advertising No. 16/2012/QH13 (National Assembly, 21 June 2012), as amended and supplemented on 20 November 2018 and 29 June 2024.

[3] Law on Protection of Consumer’s Benefits No. 19/2023/QH15 (National Assembly, 20 June 2023), as amended on 1 July 2025.

[4] Law on Securities No. 54/2019/QH14 (National Assembly, 26 November 2019).

[5] Penal Code No. 100/2015/QH13 (National Assembly, 10 July 2017), as amended on 20 June 2017.

[6] Civil Code No. 91/2015/QH13 (National Assembly, 24 November 2015).

3. What are the likely grounds on which such proceedings, actions or investigations can be instigated?

The above-mentioned principal laws would allow for proceedings, actions or investigations to be instituted based on false claims.

There is an intersection with corporate governance in the sense that directors could be liable for failure to adhere to their duties.

Where there is harm suffered, compensation for damages could also be another ground.

4. Other upcoming developments / direction of travel

The Vietnamese government has gravitated towards greater focus on sustainable development and ESG. Market participants, including a growing consumer middle class, are also more concerned with ESG. It is therefore expected that there will be greater scrutiny of greenwashing. The needs of trade partners and foreign investors are also expected to play a role.

Back to homepage