A group of global industry leaders met members of the European Parliament this month to lobby for clarity on sustainability policies after the European Commission proposed significant changes to requirements under the EU’s Corporate Sustainability Reporting Directive (CSRD) last month.
The CSRD only came into force this year although large firms have had to prepare in advance. However, the EC announced “a new roadmap . . . to boost economic growth” in January aimed at simplifying sustainability regulations.
This came partly in response to the changed composition of the EU Parliament following European elections last June and partly as a response to the reversal of environmental policies in the US under President Trump.
The EC then issued an ‘Omnibus Package’ of proposals in February which would reduce the number of companies within the scope of the CSRD by 80% by raising the threshold for compliance from EU businesses with 250-plus employees to those with more than 1,000.
Non‑EU companies would only be within scope under the revised rules if they generate annual turnover in the EU of €450 million, rather than €150 million.
The EC also proposed to push back the dates by which companies must comply.
The changes have yet to be agreed by the European Parliament and Council of member states. But the sudden changes and resulting uncertainty have alarmed industry leaders, given businesses had already prepared for the CSRD’s introduction.
Global Business Travel Association (GBTA) chief executive Suzanne Neufang, World Travel & Tourism Council (WTTC) senior vice president for advocacy and communications Virginia Messina, and Sally Davey, chief executive of the travel and technology sustainability coalition Travalyst, met policymakers in Brussels last week and called on the EU to “strike the right balance between Europe’s decarbonisation and competitiveness agendas”.
They urged the EU to align sustainability frameworks and standards “with global industry efforts”, and to support and incentivise “the deployment of sustainable travel options”.
In a statement, they noted: “While the travel and tourism industry welcomes the efforts made under the Omnibus Package to simply corporate sustainability reporting, they stress that any changes in this space should avoid creating uncertainty for businesses that have been preparing for the implementation of the original legislation.”
Omnibus Package of proposals
The EC issued the package of proposals on February 26, hailing it “as a major step forward in creating a more favourable business environment”.
It said the changes would “reduce [the] complexity of EU requirements for all businesses, notably SMEs [and] focus our regulatory framework on the largest companies which are likely to have a bigger impact on the climate and environment”. If adopted, the proposals are estimated at saving €6.3 billion a year in administrative costs.
The EC said the main changes will:
Remove about 80% of companies from the scope of the CSRD, focusing sustainability reporting obligations on the largest companies.
Ensure sustainability reporting requirements on large companies “do not burden smaller companies in their value chains”.
Postpone by two years (to 2028) the reporting requirements for companies currently in scope of the CSRD.
The EU’s sustainability due diligence requirements will also be revised to focus on the direct business partners of companies in scope, reduce the frequency of assessments, and limit the amount of information that may be requested.
When the proposals were introduced last month, European president Ursula von der Leyen promised: “More simplification is on the way.”
Call to continue dialogue
The WTTC, GBTA and Travalyst called on the EU to “continue its productive dialogue with the private sector so that the new EU standards build on existing industry insight and progress, preventing a multiplication of approaches”.
They noted: “Travel and tourism are global by their very nature. It’s essential that standards and data can be used internationally.”
Virginia Messina of the WTTC said: “The EU plays a critical role in setting the direction for global travel and tourism. However, close collaboration with the private sector is critical to ensure policies are effective, proportionate and aligned with global efforts.”
GBTA chief executive Suzanne Neufang urged the EU to “work hand in hand with the industry to develop common standards”, adding: “Policies that provide certainty on capital deployment for rail, multimodality and SAF are critical.”
Davey warned: “Our work to decarbonise and grow sustainably must be aligned otherwise we will go backwards.”
Croatian MEP Nikolina Brnjac, who hosted the meeting, said: “It’s our duty to find a balanced solution, not to de-regulate, but to regulate better.”