EU Parliament Divided: Sustainability Efforts Face Major Cuts

The European Parliament has slashed the scope of a key corporate sustainability law amid alliances between far-right and center-right parties, facing pressures from global entities. The reduced rules will affect only larger companies, sparking controversy among various EU political factions and international stakeholders.

The European Parliament witnessed a major shift as far-right and center-right parties united to roll back the EU's corporate sustainability directive. Originally adopted last year, the directive mandates companies to address human rights and environmental issues or face substantial fines. This legislative change responds to international pressures from the U.S. and Qatar.

In a pivotal vote, the requirement for compliance was narrowed to only include companies with at least 5,000 workers and a 1.5 billion euro turnover. This excludes about 90% of previously affected companies, marking a significant departure from the earlier thresholds. Furthermore, climate change commitment plans are no longer mandatory for these companies.

Opponents lamented this decision, accusing the ruling parties of dismantling important safeguards. The far-right Patriots for Europe celebrated breaking through long-standing barriers in the EU assembly. This decision challenges the EU's balance between business interests and environmental responsibilities, accentuating internal divisions and highlighting external influences.

(With inputs from agencies.)