In this article we summarise a few key updates from the EU that are relevant for the board community to be aware of.
New Report on the EU State of the Climate 2023
The new report "European State of the Climate 2023" has recently been published. Produced by Europe's Copernicus Climate Change Service (C3S) and the WMO, the report provides a comprehensive and science-based overview of how climate change is affecting Europe.
Europe is warming twice as fast as the global average (2.6°C above pre-industrial levels by 2023), making it the fastest-warming continent on Earth.
Read more here: https://climate.copernicus.eu/sites/default/files/custom-uploads/ESOTC%202023/Summary_ESOTC2023.pdf
EU Lawmakers agree to exit the energy charter
EU lawmakers voted overwhelmingly to pull the bloc out of a controversial international treaty. The Energy Charter Treaty dates back to the 1990s and gives sweeping rights and protections to big energy investors - mainly fossil fuel companies. Friends of the Earth reports that, in Europe alone, 350 billion euros worth of oil, gas and coal projects are protected under the treaty.
More information is available here. https://www.ft.com/content/3388a1b1-6243-4ad8-953f-4d88fe4e19c4
The Corporate Sustainability Due Diligence Directive (CSDDD) passed the final vote in the European Parliament
The CSDDD, despite recent compromises, remains highly significant as it marks the incorporation of sustainability due diligence into legal frameworks, signalling its significance in global business practices beyond just voluntary guidelines, like the UN Guiding Principles. Its impact extends beyond directly covered companies, affecting entire value chains and laying the groundwork for future expansions in scope. Despite recent compromises and dilutions, it still promotes awareness and understanding of risk-based due diligence across industries following OCDE Guidance for Due Diligence.
It will introduce comprehensive mandatory Human rights and environmental due diligence obligations, with imposition of financial penalties if companies do not comply. It will also create a new obligation for companies to adopt and set up a climate transition plan. Overall companies in scope of CSRD and CSDDD will not do double reporting, CSDDD will be reported into CSRD.
This new due diligence obligation will be evolving in addition to some specific obligations from EU Conflict Minerals Regulation, EU batteries Regulation, EU Deforestation Regulation, and the recent EU ban on products made with forced labour which was approved in May 2024
Now that the CSDDD has been approved, the final legal text will be published and transposed into National Law. First reporting is expected by 2027.
Read more here: https://www.europarl.europa.eu/news/en/press-room/20240419IPR20585/due-diligence-meps-adopt-rules-for-firms-on-human-rights-and-environment
New rules adopted for Packaging waste
The European Parliament recently approved new measures to make packaging more sustainable and reduce packaging waste in the EU. The rules, which have been provisionally agreed with the Council, include packaging reduction targets and require EU countries to reduce the amount of plastic packaging waste in particular.
Read more here: https://www.europarl.europa.eu/news/en/press-room/20240419IPR20589/new-eu-rules-to-reduce-reuse-and-recycle-packaging
Last attempt to save the Nature Restoration Law
A last-ditch attempt to try to save the EU’s nature restoration laws from oblivion has been mounted by 11 member states, which are racing to get the legislation over the line in the next four weeks. In a move led by Ireland, 11 environment ministers have written to countries that have said they will either abstain or vote against ratification of the laws, urging them to think again.
Read more here: https://www.theguardian.com/world/article/2024/may/14/ministers-mount-last-ditch-attempt-to-save-eu-laws-on-restoring-nature
