As the EU announced its 2040 climate target and national climate commitments are under revision, the role of business in delivering that ambition is under renewed scrutiny. Will business be brought in as a partner, or pushed out by short-sighted reforms?
The truth is: many European businesses are already on board. Contrary to the dominant narrative, they are not resisting climate rules — they are actively calling for strong, coherent sustainability rules — not less regulation, but better, simpler regulation to guide their transition. These businesses know that competitiveness and climate ambition must go hand in hand.
It is no surprise that Europe’s ESG opposition comes from some of the most polluting industries and mostly from outside the EU. A recent report by the Wall Street Journal shows that major fossil fuel companies have lobbied the Trump administration to weaken the EU’s flagship green rules — from transition planning to due diligence and methane emissions.
Some of these same actors have reduced their presence in Europe and are now campaigning to overturn the regulatory architecture that Europe has been building since before the previous Von der Leyen term.
This is not the voice of business in Europe. Here, things are much more nuanced.
Ambitious, usable and consistent rules
Leading companies and investors launched a joint call for ambitious sustainability reporting rules under the Omnibus package, asking for a coherent, forward-looking sustainable finance framework that empowers companies to prepare for — and benefit from — the net-zero transition.
The key message is that while there is a need for simplification, these rules should be ambitious, usable and consistent across the EU. Policymakers should resist efforts to dismantle the very foundations of these rules.
Excluding thousands of companies from sustainability reporting and due diligence obligations, as the EU is currently trying to do under changes to CSRD (Corporate Sustainability Reporting Directive) and CSDDD (Corporate Sustainability Due Diligence Directive), would effectively remove them entirely from the transition conversation.
This does nothing to support their preparedness — it merely sidelines them at a moment when inclusion and guidance are critical. It also deprives investors and customers of vital information on risks, dependencies and opportunities across the economy.
Transition planning at the centre
Equally important, the statement affirms the need to retain robust, mandatory transition planning under the Omnibus proposal. As Europe sets its 2040 climate target and submits its updated NDC this year, businesses must have clear guidance and accountability tools to play their role.
Transition plans are the backbone of strategic transformation both within companies across sectors, and European businesses are already preparing them. They signal intent, align internal decision-making with long-term goals, and unlock investor confidence. Removing or weakening this requirement in CSDDD sends precisely the wrong message.
Businesses require regulatory alignment and predictability, especially from an investment perspective. There is a need to look at the complexity of rules and reporting requirements but in an attempt to simplify, politicians have ended up simply removing obligations and accountability, resulting in further confusion when convergence and clarity are needed most.
Value chain teamwork
One particularly risky idea on the table in the Commission’s Omnibus proposal is to limit value chain reporting by capping the number or size of companies required to disclose. This may appear as simplification on paper, but it comes with high systemic costs.
Such a cap would place additional burden and costs on large firms, forcing them to prove negative compliance and trace gaps, while also blinding the system to material upstream risks and limiting their engagement with suppliers.
We have complex value chains — we cannot simply chop off parts of them and pretend they don’t matter. Smaller companies must be part of a meaningful conversation with the rest of the ecosystem.
Above all, Europe must safeguard the integrity of its sustainable finance framework. This is not just a question of environmental ambition — it is about strategic credibility, economic modernisation and global competitiveness. Weakening the rules under external pressure would signal that Europe can be lobbied into abandoning its long-term interest.
Leading the transition: the businesses walking the talk
Many businesses are already moving. Investors are allocating capital based on sustainability data. Transition plans are guiding strategic shifts. Reporting has helped unlock dialogue with supply chains and customers. In many cases, existing rules have been a catalyst, not a constraint.
Take some of statement signatories for example. Signify, the world leader in lighting, committed to a 2040 net-zero target and climate action across its value chain. They use EU-aligned reporting to demonstrate progress on circularity, emissions, and responsible sourcing.
European companies are already publishing science-based transition plan aligned with disclosure standards. Ingka Group (IKEA) leverages sustainability reporting to engage their suppliers to achieve climate neutrality across their value chains.
Financial institutions like Allianz SE and Nordea use their and investees’ transition plans to steer financing towards climate goals.
These are not symbolic gestures or compliance box ticking— they are strategic shifts grounded in transparency, accountability, and long-term value creation. The rules, when stable and well-designed, support this direction of travel and ensure others can follow with confidence. The proposed Omnibus changes are behind the curve and risk misaligning business momentum with EU goals.
Europe should not allow misinformation, lobbying from abroad, or outdated assumptions to shape the future of its economy. We have a once-in-a-generation opportunity to build a green,
modern and competitive Europe — but only if we bring all businesses with us.
