**Introduction** The main challenges for companies aiming to improve sustainable trade performance stem from regulatory fragmentation, rising due-diligence and disclosure obligations, high traceability and data requirements across multi-tier supply chains, and adjustment costs linked to sustainability-related trade and industrial policies. These factors shape firms’ market access conditions, compliance costs, and operational feasibility across jurisdictions[1]. **What is sustainable trade performance?** Sustainable trade performance refers to the ability of firms to participate in international trade while meeting environmental and social standards and maintaining long-term resilience and competitiveness. In practice, this increasingly involves responsible business conduct due diligence, sustainability-related disclosure, supply-chain traceability, and compliance with trade measures linked to climate, environmental, and social objectives. Performance outcomes therefore reflect both firm practices and the policy and institutional environments in which trade takes place[1][2]. **Key constraints on improving sustainable trade performance** **1.** **Regulatory fragmentation and limited interoperability of disclosure frameworks** Cross-border operations are complicated by divergent sustainability-related disclosure frameworks and reporting requirements. Limited interoperability across jurisdictions increases compliance costs, reduces comparability of information, and constrains firms’ ability to apply standardized sustainability processes across markets[2]. **2.** **Compliance burdens from due-diligence requirements and partner-country capacity gaps** Mandatory and quasi-mandatory due-diligence regimes introduce significant implementation demands, particularly where suppliers operate in jurisdictions with limited regulatory capacity or supporting infrastructure. Common constraints include access to guidance, technical expertise, verification systems, and financing, with cost impacts varying according to proportionality thresholds and phase-in arrangements[3]. **3.** **Traceability and data limitations across complex value chains** Improving sustainable trade performance increasingly depends on reliable data across production networks, including supplier mapping, chain-of-custody documentation, and auditable sustainability metrics. Where digital trade systems, paperless trade, and interoperable data frameworks are underdeveloped, firms face higher transaction costs and reduced supply-chain visibility, slowing traceability improvements[4]. **4.** **Sustainability-linked trade measures and competitiveness adjustments** Environmental and social objectives are increasingly pursued through trade-related instruments embedded in climate and industrial policy. These measures can alter relative costs and competitive conditions across locations and firms, requiring adjustments in inputs, production processes, and verification capacity that may be difficult to implement within existing commercial timelines, particularly for smaller exporters[5]. **Conclusion** Challenges to improving sustainable trade performance are largely systemic rather than firm-specific. Fragmented regulatory frameworks, due-diligence compliance burdens, traceability and data constraints, and sustainability-linked trade measures collectively increase the cost and complexity of operating across markets. Progress depends on closer alignment between firm-level practices and broader improvements in regulatory interoperability, implementation capacity, and trade-facilitation and data infrastructure.
