(Brussels, February 28, 2025) – The European Parliament and EU member states should reject legislation proposed by the European Commission that would significantly weaken key EU “Green Deal” laws, Climate Rights International said today. The draft legislation would threaten three landmark pieces of EU legislation: the Corporate Sustainability Reporting Directive (CSRD), the Corporate Sustainability Due Diligence Directive (CSDDD), and the EU’s sustainable finance taxonomy.

Bowing to corporate pressure, on February 26 the European Commission proposed an “Omnibus simplification package” that would severely undermine critical EU environmental, climate, and human rights due diligence, reporting and finance rules, undermining hard-won progress just as these new laws were set to take effect. All three laws are essential to advancing corporate accountability, transparency, and green investment.

 “Under the guise of ‘simplification,’ the European Commission is proposing sweeping changes that would cripple core Green Deal laws before they have even been implemented and tested,” said Lotte Leicht, Advocacy Director at Climate Rights International. “If agreed, these reckless proposals would reward corporations that ignore human rights, environmental destruction, and climate harms—while throwing responsible companies that prepared for compliance and a European level playing field under the bus.”

The European Green Deal is the EU’s roadmap to reaching Net Zero by 2050, while curbing environmental destruction and related human rights abuses. It has led to the adoption of a wave of transformational regulation and policies, including on corporate responsibility and accountability for environmental and human rights harms. These include:

• In 2020, adoption of the EU Taxonomy for Sustainable Activities to classify green and climate-friendly investments.

• In 2023, passage of the Corporate Sustainability Reporting Directive requiring corporations to report greenhouse gas emissions and governance actions, with reporting starting in 2025.

• In 2024, adoption of the Corporate Sustainability Due Diligence Directive, which introduced mandatory human rights and environmental due diligence requirements, with legal liability for violations in companies’ value and supply chains.

“The European Commission’s proposed “Omnibus package” represents a fundamental retreat from its ‘green’ commitments, undermining corporate accountability and environmental and human rights protections while introducing unnecessary uncertainty for businesses and consumers,” said Leicht.

The CSDDD would be stripped of its core purpose of ensuring that companies prevent and mitigate human rights abuses and environmental destruction in their entire supply chain. For example:

• Core due diligence obligations would be dramatically weakened, as companies would only need to assess direct business partners, ignoring risks further down the supply chain – where most environmental and human rights harms occur – unless “credible” concerns arise.

• EU member states would be barred from setting higher due diligence standards, as mandatory harmonized EU norms would be a ceiling instead of a floor.

• Instead of being required to take action when aware of violations, companies would be able to simply suspend links to companies in their supply chains, thereby allowing those companies to continue to do business with other companies.

• Companies would only be required to engage with directly affected communities and workers, not with civil society organizations documenting wrongs.

• Liability for due diligence violations would depend on national laws, not EU law.

• Required Climate Transition plans would be made meaningless as companies would be required to only outline planned actions but not implement them, rendering corporate climate pledges empty and merely a box ticking exercise.

The reduced CSDDD standards would fall below what is contained in the United Nations Guiding Principles on Business and Human Rights and OECD Guidelines for Multinational Businesses on Responsible Business Conduct, Climate Rights International said.

The CSRD, adopted to ensure corporate transparency, would be hollowed out, limiting the number of companies required to report on sustainability:

• Only firms with more than 1,000 employees (up from 250) would be required to report, exempting thousands of corporations.

• Sector-specific reporting would be eliminated. Companies would no longer be required to report using industry-specific sustainability standards, which is likely to increase confusion and reduce comparability.

• Large corporations could only request instead of require sustainability data from small and mid-size enterprises in their supply chains, making it harder to ensure ethical sourcing.

• Only companies with more than €450 million in EU revenue must comply, up from €150 million, exempting many global firms operating in the EU.

• Companies would only be required to conduct sustainability due diligence every five years, instead of annually – allowing violations to go unchecked for long periods.

The EU’s Taxonomy framework, designed to drive sustainable finance, would also be weakened:

• Only companies with more than €450 million in turnover must comply, drastically shrinking the number of firms covered.

• Companies would be required to only partially disclose green investment data, making it harder to track genuine progress.

• The Green Asset Ratio (GAR), a key indicator of green investment, would be simplified, likely reducing its effectiveness.

The proposed Omnibus package was rushed through with insufficient public consultation or an impact assessment, violating the Commission’s obligations under the Aarhus Convention which requires public participation in environmental decision-making. The EU is a party to the Convention.

“These reckless deregulation proposals were pushed forward without proper consultation, ignoring key stakeholders, and in direct violation of EU transparency standards,” said Leicht. “The Commission’s attempt to roll back fundamental environmental and human rights protections without proper scrutiny is an affront to the EU’s own principles and legal commitments, and a terrible signal to governments around the world that have shown themselves less interested in protecting the climate and human rights.”

The European Climate Law requires the EU to achieve net-zero emissions by 2050. Climate scientists have repeatedly warned that delaying emissions reductions will make the Paris Agreement’s temperature goal impossible to meet, with catastrophic consequences. The Copernicus Climate Change Service  has confirmed that 2024 was the warmest year on record globally, and the first year where the average global temperature exceeded 1.5°C above pre-industrial levels, the limit set by the Paris Agreement.

“Instead of dismantling Green Deal laws, the EU should be implementing and strengthening them,” said Leicht. “People across Europe must demand that their governments and elected members of the European Parliament defend the Green Deal and its laws protecting the rights, lives, and livelihoods of present and future generations. It should never be good business to violate rights and destroy the environment and climate.”