The EU Commission unveiled a package Wednesday to ease red tape for business by streamlining sustainability reporting and due diligence requirements across the European Union.
It is promising simpler regulations, more practical reporting requirements, and improved due diligence procedures for European businesses says the EU executive. This, it says, will simplify EU rules, boost competitiveness, a well as unlocking additional investment capacity as a first step in far-reaching simplification efforts across all sectors of legislation.
“We are defining a path towards a more growth-friendly, more usable and proportionate EU sustainable finance rules,” said Financial Services Commissioner Maria Luís Albuquerque: “By facilitating a more conducive business environment, we can drive growth and EU’s competitiveness, attract investments, and continue to deliver on our Green Deal objectives.”
The Commission’s target is to deliver an unprecedented simplification effort, by achieving at least 25% reduction in administrative burdens, and at least 35% for SMEs until the end of this mandate.
These first ‘Omnibus’ packages, bringing together proposals in a number of related legislative fields, cover a far-reaching simplification in the fields of sustainable finance reporting, sustainability due diligence, EU Taxonomy, carbon border adjustment mechanism, and European investment programmes.
The proposals will reduce complexity of EU requirements for all businesses, notably SMEs and small mid-caps, focus our regulatory framework on the largest companies which are likely to have a bigger impact on the climate and the environment, while still enabling companies to access sustainable finance for their clean transition.
If adopted and implemented as set out today, the Commission estrimates the proposals to bring total savings in annual administrative costs of around €6.3 billion and to mobilise additional public and private investment capacity of €50 billion to support policy priorities.
The proposal is being seen by small business groups as offering breathing space for businesses in a difficult trading environment.
Environmental group WWF however says the package represents a policy shift away from the EU’s green commitments. “Under the guise of ‘simplification’, the Commission put forward a proposal that will hinder economic and business success. Those who claim to advocate for long-term prosperity cannot, in good conscience, support an approach that strips the EU’s sustainable finance framework of its ambition, thereby taking Europe off its agreed course to become a competitive green economy,” said said Mariana Ferreira, Sustainable Finance Policy Officer at WWF European Policy Office.
Detailed breakdown of key simplifications and their impact – Commission Q&A
Full Commission proposals (Omnibus 1 | Omnibus 2)
Commission Staff Working Documents 1
Commission Staff Working Documents 2
Call for Evidence open on the Taxonomy Delegated Acts
