Europe Is Looking to Roll Back Climate Accounting Rules

Changes would seek to ease companies’ regulatory burden amid concerns over the continent’s competitiveness

By Yusuf Khan and Kim Mackrael of The WSJ. Excerpts:

"The European Commission is reviewing elements of its flagship Green Deal environmental policy, as worries over rising costs and a lack of competitiveness with China and the U.S. grow within the continent.

Commission officials met Wednesday and Thursday with businesses and industry groups to discuss broad changes to its sustainability legislation that will start to go into effect this year. The meeting followed a report released last week by the bloc’s executive arm in which it outlined concerns over competition and said that it needed to cut red tape while also championing decarbonisation to help the continent restore economic growth.

“The EU must urgently tackle long-standing barriers and structural weaknesses that hold it back. For over two decades, Europe hasn’t been able to keep pace with other major economies, due to a persistent gap in productivity growth,” the European Commission said in its Competitiveness Compass document.

The Competitiveness Compass laid out a plan to boost the bloc’s economy and make its companies more competitive globally. Planned measures include reducing companies’  regulatory burden, lowering barriers that hurt trade and investment flows between EU member states and offering better training opportunities for workers."

"Two key policies are under review: the Corporate Sustainability Reporting Directive and the Corporate Sustainability Due Diligence Directive. These directives were seen as landmark climate initiatives, impelling companies to report on their social and environmental impacts."

"some companies arguing that applying the reporting requirements adds to costs and hinders the process of doing business. France and Germany have both called on Brussels to delay or relax certain sustainability reporting rules in recent weeks."