Latest news with #CorporateSustainabilityReportingDirective
Forbes
7 days ago
- Politics
- Forbes
Ombudsman Investigation Into EU Sustainability Reporting Bill Moves Forward
Teresa Anjinho In April, a group of climate change organizations filed a complaint with the European Ombudsman asserting that the European Commission failed to follow the proper process in drafting legislation to reduce sustainability reporting requirements. To the excitement of sustainability activists, on May 21, the Ombudswoman announced she was opening an official investigation. That investigation has now moved forward, with the official submission of questions to the Commission. However, given the timeline and limited authority of the Ombudsman, the inquiry will have little impact on the final outcome. In November, the new leadership of the European Commission proposed the Omnibus Simplification Package to reduce the scope of the Corporate Sustainability Reporting Directive and the Corporate Sustainability Due Diligence Directive. The proposal by the Commission was negotiated behind closed doors and largely held secret until the final draft was approved. The Commission's proposal was then sent to the Council and the Parliament. Each body will debate their respective positions, before the three enter into a trilogue to come to a final proposal. While the normal process of negotiating a new directive can takes years, it is expected that the final package will be adopted in the fall. The accelerated timeline has concerned some sustainability advocates who believe reforms deserve more study and public debate. In an effort to bring to thwart the reforms, in April, a complaint was filed to the European Ombudsman by 'eight civil society organizations': ClientEarth, Notre Affaire à Tous, Clean Clothes Campaign, European Coalition for Corporate Justice, Global Witness, Transport & Environment, Antislavery International and Friends of the Earth Europe. On May 21, Teresa Anjinho, the European Ombudswoman, announced an official inquiry into the complaint. The case is titled 'The European Commission's failure to comply with its 'Better regulation guidelines' in preparing a legislative proposal on corporate sustainability reporting and due diligence.' On June 16, the Ombudsman's office met with Commission staff to discuss the inquiry. Following the meeting, the Ombudsman announced she believed written responses were necessary. There are four main topics the Ombudsman wants addressed: the impact assessment, public consultation, the climate consistency assessment, and the Inter-Service Consultation. Under the EU's Better Regulation Guidelines, new legislation is required to go through a an assessment to determine what economic, environmental or social impacts the proposal may have. The Commission did not conduct an impact assessment for the simplification proposal. Addressing the absence of an impact assessment, the ombudsman stated, "While the legislative proposal in question would, in principle, have required a full-fledged impact assessment, the Commission did not conduct one, preparing instead an analytical document, in the form of a staff working document." "In its explanatory memorandum, the Commission justified the 'critical urgency' of the proposal, and the related derogation from the impact assessment requirement, with the need to maintain the competitiveness of EU businesses… However, the Commission did not indicate any sudden or unexpected event that would justify the urgency." Similarly, new proposals are required to go through a public consultation to allow stakeholders the opportunity to provide input. The Commission held meetings in February with a selected group of stakeholders, but did not open it to broader input. Addressing the absence of a public consultation, the Ombudsman stated. 'I understand that in this case the Commission considered that a public consultation was not required… nor was it feasible…."It is not clear how the stakeholder exchanges referred to in the explanatory memorandum meant that a public consultation would not have added new information, in particular considering that many stakeholders that could have contributed otherwise were not invited to participate in the February 2025 meetings." Addressing the absence of a climate consistency assessment, the Ombudsman stated, "in accordance with the European Climate Law, the Commission is required to conduct a climate consistency assessment of any draft measure or legislative proposal 'and include that assessment in any impact assessment accompanying these measures or proposals, and make the result of that assessment publicly available at the time of adoption'… It appears therefore that the Commission did not carry out a climate consistency assessment before adopting the legislative proposal in question, although the European Climate Law does not foresee any exemptions from conducting such an assessment." Finally, addressing the lack of the Inter-Service Consultation (ISC), the ombudsman stated the "Commission's rules of procedure foresee a formal ISC of 'the services with legitimate interest on account of the nature, subject-matter or impact of the draft act'. Normally, the services consulted in an ISC are given ten working days to review the proposal and to reply. 'In exceptional cases, and on duly justified grounds of urgency', the rules of procedure allow for the possibility of a Fast-Track ISC with a shortened time frame of 48 hours… For the proposal at hand, the ISC was concluded within 24 hours.' While the Ombudsman has the authority to conduct the investigation and produce a final report, authority to enforce recommendations is limited. 'The Ombudsman may be able to solve your problem simply by informing the institution concerned. If more is needed, every effort is made to reach an amicable solution that will put matters right. Should this fail, the Ombudsman can make recommendations to the institution. If these are not accepted, the Ombudsman can draw up a special report to the European Parliament, which must then take appropriate action.' However, once the report is sent to the Parliament, it becomes a political process. The report is sent to a committee that decides if further action is necessary. That committee can submit a motion for a resolution by the Parliament. That process can take months. Even if the Ombudsman finds the process was was flawed, the report will have minimal impact on the Omnibus package. The Commission was given a deadline of September 15 to respond to the questions. Following the Ombudsman's procedures, the final report may not be issued until the end of the year, after the reforms to sustainability reporting have been approved. The focus of the Ombudsman appears to be on future Omnibus proposals and ensuring the process is followed moving forward.
Business Post
05-07-2025
- Business
- Business Post
Operational benefits beyond compliance
The business landscape is undergoing a profound transformation as environmental, social, and governance (ESG) considerations move from the periphery to the heart of corporate strategy. And while regulatory compliance often serves as the initial driver, the real value of ESG implementation lies in its operational benefits. However, for small and medium-sized enterprises, this evolution presents both challenges and unprecedented opportunities for growth, operational efficiency, and long-term resilience. While large corporations have been grappling with ESG requirements for some time, SMEs are increasingly finding themselves in the spotlight. The Corporate Sustainability Reporting Directive (CSRD) may not currently mandate reporting for smaller businesses, but not only is this exemption temporary: more immediately pressing is the growing demand from larger entities for ESG data throughout their supply chains, creating a ripple effect that reaches even the smallest suppliers. The complexity of ESG reporting can appear daunting. With approximately 200 data points to consider across environmental, social, and governance metrics, many SME owners and staff feel overwhelmed before they even begin. This complexity is compounded by the fact that ESG encompasses everything from energy consumption and waste management to employee wellbeing and board diversity. The challenge is often exacerbated by SMEs discovering their need to provide ESG data only when larger clients make sudden demands. Ashleigh Connors, an ESG consultant at TEKenable, said that businesses often remain 'blissfully ignorant - until someone comes knocking on their door looking for specific data points'. The pressure is mounting from multiple directions. Large corporations, increasingly held accountable for their entire value chain's environmental and social impact, are demanding greater transparency from suppliers. Meanwhile, public and private tenders now routinely include ESG criteria, making sustainability performance a competitive differentiator rather than merely a regulatory requirement. While regulatory compliance often serves as the initial driver, the real value of ESG implementation lies in its operational benefits. 'There are also cost savings to be had, as it makes energy use very obvious,' Connors said, pointing to how systematic monitoring of environmental metrics makes consumption patterns immediately visible, highlighting inefficiencies that might otherwise go unnoticed for years. There is also the example of supply chain responsibility: 'It's not just what you're doing as a company,' Connors said. 'If you're buying from other companies that has a knock-on effect. If you buy palm oil, it's your responsibility to ensure it's not contributing to deforestation.' This extended responsibility might seem burdensome, but it actually drives innovation in sourcing strategies and can lead to more resilient supply relationships. The competitive advantage However, the financial implications are equally compelling. Energy audits frequently reveal substantial cost-saving opportunities, while improved resource management can significantly reduce waste-related expenses. Companies that embrace ESG early often discover that what initially appeared to be additional overhead actually enhances their bottom line. The key to successful ESG implementation lies in systematic data collection and analysis. Modern technology solutions can integrate with existing business systems, automatically capturing relevant metrics and presenting them through intuitive dashboards. As Connors puts it: 'If you're not tracking it, then you're not managing it.' For businesses wondering where to begin, Connors recommends starting with energy management. 'Starting with energy makes sense as it's the biggest thing,' she said; as energy consumption typically represents one of the largest controllable operational costs, it is an area where improvements deliver immediate, measurable results. A comprehensive energy audit examining heating systems, transport, and machinery provides a solid foundation for broader ESG initiatives. Once baseline measurements are established, the focus naturally shifts to optimisation. This might involve upgrading to more efficient equipment, implementing smarter scheduling systems, or simply raising awareness among staff about energy consumption patterns. Crucially, SMEs embarking on their ESG journey need not go it alone, Connors said. 'There's a lot of support out there. You have the likes of Enterprise Ireland, you have the IDA and so on. There is money sitting there, from the EU, ready to help SMEs do things in this area.' The European Union has also introduced the Voluntary SME (VSME) standard, providing a structured framework for companies ready to embrace ESG principles without the full complexity of enterprise-level reporting requirements. This graduated approach allows businesses to build capability progressively rather than attempting to implement comprehensive systems immediately. Simply looking at heating, transport, and machinery, you can audit that and at TEKenable we can create dashboards Professional guidance can prove invaluable in navigating the initial complexity. ESG consultants help businesses identify which metrics matter most for their specific sector and circumstances, avoiding the paralysis that can result from trying to address everything simultaneously. Forward-thinking SMEs are discovering that early ESG adoption creates significant competitive advantages. As procurement processes increasingly incorporate sustainability criteria, companies with robust ESG credentials find themselves better positioned to win contracts and attract investment. The reputational benefits extend beyond formal procurement processes. Consumers, particularly younger demographics, increasingly favour businesses that demonstrate genuine commitment to environmental and social responsibility. This trend is particularly pronounced in business-to-business (B2B) relationships, where corporate customers face their own ESG reporting requirements. The ESG revolution represents more than regulatory compliance or market pressure; it reflects a fundamental shift towards more sustainable and resilient business models. For SMEs, early engagement with ESG principles offers the opportunity to shape their approach proactively rather than reactively. Success requires viewing ESG not as an additional burden but as a framework for operational excellence. Companies that embrace this perspective often find that ESG implementation enhances decision-making processes, improves risk management, and creates new opportunities for innovation and growth. The message for SMEs is clear, said Connors: ESG engagement is no longer optional for businesses serious about long-term viability. With appropriate support, strategic planning, and the right technological tools, even the smallest enterprises can successfully navigate this transformation while unlocking new sources of value and competitive advantage. 'Simply looking at heating, transport, and machinery, you can audit that and at TEKenable we can create dashboards. After that you start optimising – you will then be able to start to move the dial,' she said.
Fibre2Fashion
03-07-2025
- Business
- Fibre2Fashion
US AAFA writes to Massachusetts committee opposing The Fashion Act
The American Apparel & Footwear Association (AAFA) recently wrote to the Massachusetts joint committee on environment and natural resources sharing its concerns over The Fashion Act (H1032), aimed at environmental accountability in the fashion industry. While the legislation is well intended, it creates a costly and burdensome regulatory mechanism that cannot effectuate the results it seeks, AAFA noted. US trade body AAFA wrote to the Massachusetts joint committee on environment and natural resources sharing its concerns over The Fashion Act, aimed at environmental accountability in the fashion sector. The act creates a costly and burdensome regulatory mechanism that cannot effectuate the results it seeks, AAFA noted. It does not allow for full alignment with the Science-Based Targets Initiative. The act establishes requirements that do not align with standards and initiatives referenced in the act, as well as legislative and regulatory requirements to which the fashion industry is already subject, AAFA president and chief executive officer Steve Lamar wrote in the letter. This lack of harmonisation creates an unnecessarily complicated compliance framework for companies without providing a material sustainability benefit. In some instances, such conflicts can undermine the goals of the initiatives to which the legislation points, he noted. Harmonisation with European Union (EU) regulations will be critical and it will also be important to learn from what was unworkable for the EU, the letter said. The European Union's Corporate Sustainability Reporting Directive (which applies to many US companies, both in and outside the fashion sector) and the California Climate Corporate Data Accountability Act (SB 253) both currently require covered companies to report on their greenhouse gas emissions. The Fashion Act does not align with the established timelines or assurance levels in either piece of legislation. It does not align with other pending climate legislation in New York, New Jersey, Colorado or Illinois as well, AAFA remarked. While The Fashion Act requires fashion sellers to set targets, it does not actually allow for full alignment with the Science-Based Targets Initiative (SBTi) . The act prohibits some sellers from using intensity-based targets, even though SBTi validates such targets, the AAFA letter said. Holding companies to absolute targets means mergers or acquisitions could put companies out of compliance, while divestment of business would give the appearance of emissions reduction without actual achievement, the letter noted. The act provides overly prescriptive data collection requirements that are not required by SBTi, and are not actually implementable, AAFA observed. Despite the industry adhering to dozens of chemical regulations across the globe, The Fashion Act piles additional, impractical requirements that are not aligned with existing programmes and would actually discourage the addition and detection of new chemicals in wastewater, Lamar wrote. 'Sales of fashion products by third-party sellers on online marketplaces would be exempt from the requirements under the bill as it is written. If the intention of the legislation is to make marketplaces clean up their production, this bill misses the mark. With third-party sales expected to comprise almost two thirds of all e-commerce sales by 2027, this represents a significant omission,' the AAFA letter mentioned. Finally, the legislation provides no incentives, no diplomatic or technical support and no guidance for the industry to achieve its objectives, it added. Fibre2Fashion News Desk (DS)
Malaysian Reserve
26-06-2025
- Business
- Malaysian Reserve
Gravity Expands Presence and Team in Europe
Geographical expansion driven by European companies' demand for solutions that move beyond sustainability disclosure and drive business value SAN FRANCISCO, June 25, 2025 /PRNewswire/ — Gravity, the leading enterprise carbon accounting and energy management platform, today announced that it has expanded its presence and team in Europe. This strategic expansion builds on the company's early traction in the region, where Gravity serves customers operating in 19 countries, and significant growth in North America, where over 60% of its customers have switched from other providers. 'In working with European customers, we've heard familiar pains: automation is falling short, causing organizations to spend far too much time on measurement; regulatory changes are difficult to track and prepare for; and the work increasingly needs to align with business priorities to justify investment,' said Saleh ElHattab, Co-Founder and CEO of Gravity. 'Gravity has been laser-focused on these pain points since day one, and we've already saved our European partners time and money. We're thrilled to be expanding our support on the continent.' Gravity's customers in Europe span a wide variety of sectors and sizes and include Adyen, a global financial technology platform headquartered in Amsterdam; Permasteelisa Group, a leading global contractor in architectural envelopes based in Italy; and SHV Energy, a leading global distributor of off-grid energy headquartered in the Netherlands, among others. The company has already supported its customers to prepare for disclosure to the EU's Corporate Sustainability Reporting Directive (CSRD) and for third-party audits, which its customers have passed with no qualifications. 'Across our operations in Europe and globally, Gravity has been instrumental in empowering Permasteelisa to better understand our Scope 1, 2, and 3 emissions — leveraging technology to simplify processes and scale the impact of our work,' commented Anna Foden, Head of Sustainability at Permasteelisa. 'We look forward to deepening our work together as Gravity expands in our home base of Italy and across the region.' To lead the company's growth in Europe, Gravity has increased the size of its existing team of climate and product experts in the region. The expanded team is led by Giulia Borsa, a senior sustainability expert and sales leader based in Barcelona, and Miles Cox, a seasoned private equity professional based in London. Gravity intends to continue growing its European team over the coming year, with a focus on scaling its Sales and Marketing functions and expanding its presence in Germany, France, Italy, the Netherlands, Spain, and the United Kingdom. In addition to global emissions reporting frameworks, Gravity's Europe team has deep expertise in advising customers on how to navigate and report for a wide range of Europe-specific regulations, including the EU's CSRD, taxonomy for sustainable activities, and Carbon Border Adjustment Mechanism (CBAM), as well as the UK's Streamlined Energy and Carbon Reporting (SECR) and Spain's Ley 7/2021 de Cambio Climático y Transición Energética, among others. About GravityGravity is an end-to-end carbon accounting and energy management solution that aligns sustainability and business impact. Built for energy-intense operations and companies with complex supply chains, Gravity empowers the world's makers and leading institutions to easily comply with emissions reporting requirements, win over customers, and reduce costs by optimizing energy use. With industry-leading technology, Gravity ensures customers can navigate the changing regulatory environment with confidence and execute projects that drive meaningful energy reductions, while protecting – and enhancing – their bottom line. Learn more and arrange a demo at
Miami Herald
24-06-2025
- Business
- Miami Herald
EU endorses proposal for environmental deregulation
June 24 (UPI) -- The European Union is set to amend its current ethical supply chain rules after its ambassadors endorsed a simplification bill from the Council of the EU. "Today we delivered on our promise to simplify EU laws," said EU Minister of Poland Adam Szlapka in a press release Monday. "We are taking a decisive step towards our common goal to create a more favorable business environment to help our companies grow, innovate, and create quality jobs." The bill would impact current environmental laws with the intention of shrinking the regulatory pressures on businesses in order to juice up the EU's economy. Two such green rules are the EU's Corporate Sustainability Reporting Directive and the Corporate Sustainability Due Diligence Directive. These currently insist that all the companies that do business in the EU and have at least 1,000 employees report their environmental effects. The bill would increase the employee threshold that forces a company to comply up to 5,000 employees. Currently, the CSRD and CSDDD also require companies that make at least approximately $522 million in net turnover to monitor their supply chains for environmental and human rights violations. The bill would raise that starting bar to about $1.7 billion. The release said the regulations were being loosened based on the concept that larger companies "are best equipped to absorb the costs and burdens of due diligence processes." The bill would also limit the obligation required for companies to adopt a transition plan to deal with climate change. It would give the EU Council authority to advise companies on how to create and execute such plans. The Council could then give companies up to two years to implement those plans in order to "further reduce burdens and provide companies with sufficient time for adequate preparations." If adopted, less than 1,000 companies would be affected by the CSRD, down from the nearly 50,000 companies that currently must comply. However, should Omnibus pass, there could be legal challenges. The nonprofit ClientEarth Europe environmental organization posted to X Tuesday that "The Omnibus is fueling legal uncertainty and might breach the law too." "A new legal analysis warns of the risk of future legal challenges if the Omnibus is passed into law," the post continued. "The agreement reached by the EU Council last night heightens these risks by further undermining the [CSDDD]. Copyright 2025 UPI News Corporation. All Rights Reserved.
