Business Ethics News: EU AI Act Enforcement Now Live
The last fortnight moved corporate ethics from paper to enforcement on both sides of the Atlantic. The EU AI Act's enforcement powers went live, so the European Commission can now investigate and fine the makers of general-purpose AI models. In the United States, the Department of Justice widened who can collect a whistleblower award, and the securities regulator closed the comment period on scrapping its climate disclosure rule. Here is what changed and why compliance and governance teams should care.
EU AI Act enforcement powers go live
From 2 August 2026 the European Commission, acting through its AI Office, can formally investigate and enforce the AI Act's obligations on providers of general-purpose AI (GPAI) models, alongside the rules on prohibited AI practices. This is the enforcement machinery switching on, not just the arrival of the transparency duties that reached their application date on the same day. The AI Office can request technical documentation, obtain access to models for evaluation, order corrective or risk-mitigation measures, and impose fines of up to 15 million euros or 3 per cent of worldwide annual turnover, whichever is higher.
Supervision is shared. The AI Office oversees general-purpose models and AI built into very large online platforms and search engines, national authorities cover most other systems, and the European Data Protection Supervisor handles systems used by EU institutions. For governance teams, the practical shift is that the penalty regime is now real: any firm placing a GPAI model on the EU market needs its documentation, evaluations and incident reporting in order rather than in progress.
Source: Help Net Security
DOJ widens who can claim a corporate whistleblower award
On 30 July 2026 the Department of Justice revised its Corporate Whistleblower Awards Pilot Program to expand the pool of people who can qualify for a payment. The previous rule automatically disqualified anyone who would have been eligible for an award under another government programme, such as those run by the SEC or the CFTC. Under the revision, a whistleblower is disqualified only if they actually receive an award elsewhere for reporting the same or substantially the same misconduct, and the DOJ keeps discretion to reduce or deny duplicative payments.
The revision also moves the programme into the Criminal Division's Money Laundering, Narcotics, and Forfeiture Section and routes submissions through a dedicated online intake portal. For compliance teams, a wider award pool raises the chance that misconduct reaches the DOJ directly, which is a fresh reason to make internal reporting channels credible, responsive and free from retaliation, so that employees raise concerns inside the business first.
Source: Sidley White Collar Watch
SEC's climate disclosure rule nears repeal
The public comment period on the SEC's proposal to rescind its 2024 climate-related disclosure rules closed on 3 August 2026. The Commission proposed the full rescission on 29 May 2026, arguing that the 2024 rules overreached its statutory authority. Those rules, adopted in March 2024, would have required public companies to report material climate-related risks and certain greenhouse gas emissions, but they never took effect after legal challenges put them on hold.
A final rescission still needs a further Commission vote and is unlikely before late 2026 or early 2027. The direction of travel matters for governance teams: US federal climate reporting is receding just as the EU tightens its regime, which widens the transatlantic gap and leaves multinationals managing two very different sets of expectations rather than one converging standard.
Source: SEC