Advisers to the German government are the latest to have outlined their vision for the future of European Union sustainability regulation.
As the European Commission prepares an ‘omnibus’ proposal to simplify the Corporate Sustainability Due Diligence Directive (CS3D), the Corporate Sustainability Reporting Directive (CSRD) and the Taxonomy Regulation, Germany’s Sustainable Finance Beirat (SFB) has published its position.
It calls on the Commission to align its expectations with less ambitious global standards and postpone any legal sanctions until there is more clarity about how to comply with the three rules.
“It’s not about deregulation, it’s about sensible regulation,” the body said.
The group had already published its position on the future of CSRD, saying last week that the number of data points should be reduced and more sector-specific carveouts should be introduced.
SFB’s recommendations are notably less aggressive than recent demands by German chancellor Olaf Scholz, who in January requested the Commission delay CSRD by two years and reduce its scope.
Italy
A leaked letter from the Italian finance ministry outlines a number of requests to the Commission, including the postponement of CS3D until “all outstanding issues have been properly addressed”.
It also suggests “a tailored postponement of reporting requirements” under CSRD, partly to avoid putting companies off listing in Europe.
However, it warned against making changes that would disadvantage member states that have already transposed CSRD, including Italy.
A number of countries ignored the Commission’s deadline, which required them to adopt the CSRD into national law last year.
Finland
Meanwhile, a paper published by Finland’s Ministry of Foreign Affairs last week urged policymakers in Finland and Brussels to provide more guidance to those covered by EU sustainability laws, including CSRD, the EU Deforestation Regulation and the Carbon Border Adjustment Mechanism.
The government tasked a team of academics to interview companies covered by the various rules, to find out how they were coping.
The paper, which included a set of recommendations for both firms and public authorities, said firms “expressed displeasure” at the idea of delays or amendments to the rules at this stage, because it was too soon to tell their impact and many have already invested in compliance with the current timelines and frameworks.
US
In another sign that current geopolitics will increase pressure on the Commission to deregulate, Donald Trump’s new secretary of commerce has said he will fight to remove all US companies from the scope of the CS3D.
Howard Lutnick said in his senate nomination hearing on Thursday that CS3D was “burdensome” and a “real concern for American industry”, and that he would use whatever tools necessary to remove it.
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