Welcome to the EU Monthly, NEO’s sustainability and ESG news round up from Brussels.
January 2024 highlights:
- Farmers’ protests: In what exemplified the ongoing tension between stability and the EU green agenda, farmers’ protests began in France and spilled over to other European member states in January. The protests were targeted at low wages, cheap imports and what is deemed as restrictive regulations related to environmental sustainability measures. Beyond France, farmers in Belgium, Germany and Romania have already taken to the streets, while Spanish farmers have said that they, too, will stage protests this February. (Read more: Reuters)
- Ban on certain green labelling: The European Parliament voted to ban unsupported green labelling on consumer products. By 2026, labels such as “climate neutral,” “natural” and “environmentally friendly,” among others, will be prohibited if there exists no corresponding proof to support them. This is considered by some to be a win for European consumers and the environment. (Read more: Euractiv)
- Potential delay in the CSRD: A two-year, sector-specific delay on the EU’s Corporate Sustainability Reporting Directive (CSRD) was backed by EU lawmakers in January. The CSRD is meant to ensure that companies report on ESG-related impact, but now companies in “oil and gas, mining, road transport, food, cars, agriculture, energy production and textiles” may be exempt from disclosing certain information until June 2026. The delay is aimed at giving companies breathing space and reducing bureaucracy. But it has also received criticism for its potential ability to discourage strong ESG initiatives in other countries. (Read more: Reuters)
- Changes in the CSDDD: The EU’s Corporate Sustainability Due Diligence Directive (CSDDD) obliges companies to manage and prevent adverse effects on human rights and the environment that may potentially result from their activity. There has been an ongoing debate on whether the financial sector will be subject to the directive. According to Bloomberg, it soon might be, following a joint document by the European Parliament and Council from January 2024. (Read more: Bloomberg)
- Upcoming 2040 climate strategy targets: The EU’s draft 2040 climate strategy will be presented on February 6, 2024. The European Commission will be presenting its first target for 2040: a 90% reduction in emissions, with an aim to achieve net-zero emissions by 2050. The investment to make this happen is estimated to be at EUR 1.5 trillion, and it remains up for discussion how competitiveness and a robust industry will coexist with climate targets. The presentation will also be a way to gauge interest in the contested Green Deal ahead of the EU Parliamentary elections scheduled for June 2024. (Read more: Financial Times)