EU Scales Back Corporate Sustainability Laws Amid Global Pressure

The European Union has agreed to weaken its corporate sustainability laws, responding to pressures from businesses and international governments. The changes reduce administrative costs but dismay environmental advocates. The new directive focuses on large corporations, relaxing previous requirements and extending compliance deadlines, impacting environmental and human rights policies.

The European Union has reached an agreement to loosen its corporate sustainability laws, a move influenced by sustained pressure from businesses and governments, including the United States and Qatar. This agreement amends existing regulations, reducing the scope and enforcement for numerous businesses affected by these laws.

Parliament negotiator Jorgen Warborn called this deal a groundbreaking reduction in costs, with anticipated administrative savings surpassing initial European Commission estimates of 4.5 billion euros. However, this step back has disappointed environmental advocates and some governments, who pushed for maintaining robust regulatory measures to prioritize sustainability and human rights.

The modified rules, applying only to entities with over 5,000 employees and significant turnovers, have sparked criticism for potentially undermining accountability and regulatory goals. Meanwhile, European Parliament and member states must officially endorse this realignment of corporate sustainability mandates.