To boost European businesses against US and Chinese competition, the European Commission intends to relax regulations concerning company sustainability reports and supply chain transparency. This deregulation, dubbed the “Simplification Omnibus,” is part of a larger reform package designed to support European companies. The package also includes incentives for industries to reduce their carbon footprint and initiatives to lower energy expenses.
Significant modifications to EU green standards were proposed by the European Commission, including the elimination of sustainability reporting requirements for thousands of enterprises and a one-year delay in its due diligence plan. Under the plans, only companies with more than 1,000 employees would have to disclose their environmental and human rights impacts.
The Commission also announced a “Clean Industrial Deal,” a second pillar of the competitiveness strategy, to help energy-intensive companies facing high costs and bureaucracy as they compete for market share with global rivals. It also aims to strengthen the clean technology industry. The EU aims to achieve net zero greenhouse gas emissions by 2050.
One notable change to the European Commission’s environmental policies is the substantial reduction in the reach of its carbon border tariff. About 90% of importers would be excluded from this adjustment, which is supported by the fact that their imports only account for 1% of the emissions that the policy is trying to reduce. Concurrently, there has been a lot of pushback to the Commission’s proposal to relax ESG (Environmental, Social, and Governance) regulations. This change has been strongly opposed by EU lawmakers, certain investors, and environmental activists. It is crucial to remember that these suggested modifications are not yet final. A qualified majority of the 27 EU member states and the European Parliament must approve them, meaning that additional changes could be made while the legislation is being drafted.
