US businesses say ESG rules a growing barrier to EU trade
They want to delay and even halt major planks of its environmental, social and governance rules
US COMPANIES are adding their voice to the list of critics targeting ESG regulations in Europe.
The American Chamber of Commerce to the European Union, whose members include Ford Motor, Exxon Mobil and Amazon.com is calling on the EU to delay and even halt major planks of its environmental, social and governance rules, according to a statement on Monday (Feb 10). It also says companies should be free to ignore ESG regulations until a legislative review has been completed and legislation amended.
The demands add to pressure from Germany and France, the EU’s two biggest economies, to simplify ESG rules in the face of flagging competitiveness and economic decline. EU officials are due to propose changes to key regulations – the Corporate Sustainability Reporting Directive (CSRD), the Corporate Sustainability Due Diligence Directive (CSDDD) and the Taxonomy Regulation – at the end of this month, as part of a so-called omnibus process.
“Amid significant political uncertainty while simplification is underway, businesses shouldn’t be made to comply with legislation that could materially change,” the Chamber, also known as AmCham, said.
CSRD, which requires companies to provide hundreds of ESG data points, and CSDDD, which introduces legal liability if companies allow ESG violations in their supply chains, are now “a top concern for transatlantic businesses”, AmCham said. It points out that 84 per cent of members that do business in the EU consider ESG rules “a primary barrier” to trade.
“The EU should immediately stop the clock on the transposition of the CSDDD and delay the implementation of the CSRD,” AmCham said. “At the same time, businesses need to be sure that their substantial compliance investments and commitments to transforming their business models haven’t been made in vain.”
Maria Luis Albuquerque, the EU’s financial services commissioner, has said there’s room for adjustments to the bloc’s ESG rules in light of the criticisms. But she also warned against expecting outright deregulation.
It’s about “adjusting the pace”, while “maintaining the anchor”, she said in a recent interview.
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