News Digest: EU to Scale Back Sustainability Reporting Rules for Companies
February 24, 2025
News Digest:
The European Commission is set to reduce the number of companies subject to EU sustainability reporting requirements as part of efforts to cut regulatory burdens, according to a draft proposal seen by Reuters. The move is part of a broader strategy to simplify green regulations, boost European industry competitiveness, and respond to U.S. President Donald Trump’s push to ease business regulations.
Brussels faces pressure from member states like Germany and France to weaken sustainability reporting rules, while others, such as Spain, argue they are essential for upholding EU values on environmental and human rights issues. A partial draft of the proposal indicates changes to the EU’s Corporate Sustainability Reporting Directive (CSRD). If approved, only companies with over 1,000 employees and a net turnover exceeding €450 million ($471 million) would be required to comply—significantly raising the threshold from the current 250 employees and €40 million turnover.
Additionally, the EU plans to scrap sector-specific reporting standards originally scheduled for adoption by June. The proposal also suggests delaying the Corporate Sustainability Due Diligence Directive (CSDDD), limiting due diligence requirements to companies’ direct business partners and subsidiaries while excluding subcontractors and suppliers from mandatory assessments. The final proposal is expected to be published next week.