EU agrees deal to cut sustainability reporting ‘red tape’ and due diligence rules for companies

The European Parliament and EU member state negotiators have reached a provisional deal to cut down on EU rules on sustainability reporting and due diligence requirements for companies. “Today we delivered on our promise to remove burdens and rules and boost EU’s competitiveness,” said Denmark’s Minister for European affairs Marie Bjerre, for the EU presidency: “This is an important step towards our common goal to create a more favourable business environment to help our companies grow and innovate.”

According to the informal agreement, social and environmental reporting will only be required for EU companies employing on average over 1,000 employees and with a net annual turnover of over €450 million. The net turnover threshold has also been increased for non-EU companies to €450 million generated in the EU for sustainability reporting.

Co-legislators also agreed on further simplification of the reporting requirements which should become more quantitative, while sector-specific reporting would become voluntary. They ensured smaller companies with under 1,000 employees are protected from shifting responsibility for reporting, as the updated rules allow them to refuse reporting information beyond what is set out in the voluntary standards.

The Commission is also to create a digital portal for businesses with access to templates and guidelines on EU and national reporting requirements.

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Source: EUbusiness