Latest news with #CorporateSustainabilityDueDiligenceDirective
Irish Examiner
5 days ago
- Business
- Irish Examiner
How renewables can help the earth live long and prosper
'What's the problem, Scottie?' 'It's the engines, Cap'n. They cannae take it anymore. She's gonna blow!' 'Then have to risk a full power restart. How long do you need?' 'At least fourteen hours, Cap'n. I cannae change the laws of physics!' 'You've got eight minutes.' In fairness to Captain Kirk, despite facing a seemingly unsurmountable crisis in almost every episode of the original Star Trek, he never actually lost the USS Starship Enterprise, and so continued to explore strange new worlds, to seek out new life and new civilizations, and to boldly go where no man has gone before. The Starship European Union could learn a lot from him, particularly in relation to delivering innovative solutions to complex problems in double quick time and on schedule. Admittedly, the EU missions tend to be far less glamourous than interplanetary exploration, but another important milestone date has just been pushed out and although it won't implode the whole spaceship, it is yet another small tear in the fabric of the EU sustainability strategy. The issue is with the prosaically titled 'Corporate Sustainability Due Diligence Directive' (CS3D), an instrument designed to improve and standardise the quality and content of reporting sustainability performance among companies doing business in Europe. Think of an accountancy balance sheet but instead of stating asset and money balances, it measures 'good behaviour by companies.' The CS3D directive is a key element of the overarching 'Green Deal' strategy with the long-term objective of adding transparency and accountability on an 'apples with apples' comparison basis to ensure that businesses of meaningful size provide clear and reliable information on their performance against environmental, social and governance (ESG) mandates. The other key obligation is that 'in-scope' companies adopt and put into effect a transition plan for climate change mitigation which aims to ensure, 'through best efforts, compatibility of the business model and strategy of the company with the transition to a sustainable economy and with the limiting of global warming to 1.5°C'. For businesses, it presents a trade-off between the cost and hassle of implementing additional regulatory overhead and the commercial opportunity that an increased focus on sustainability will drive additional goodwill to their brand in global marketplaces and better efficiency and innovation in their supply chains. Broadly speaking, the directive has two tangible demands on the companies impacted. Firstly, to drive focus across global 'value chains' for climate mitigation. Secondly, it formalises the principle that all businesses have a responsibility to respect human rights, which are 'universal, indivisible, interdependent and interrelated'. The intent, or — more accurately — hope, is that to meet these twin objectives, companies would begin to steer more capital investment towards sustainable processes and products and reduce impediments to better net-zero and human rights outcomes. Peter Burke, Minister for Enterprise, Tourism and Employment, has welcomed the deferral of the 'Corporate Sustainability Due Diligence Directive' (CS3D). Simply put, companies that are subject to the directive will be compelled to report and publish information on any material risks identified and what countermeasures taken to mitigate these risks and publish annually the impact, positive or negative that accrue from these changes. Even simpler put, lots more cost and time-pressure for companies for what is effectively an increased burden of 'non-finance' accounting. CS3D was issued early in 2023 and scheduled to be enacted into the national laws of the member states by July 2024. Given that the accounting standards that we know, and love today can be traced as far back as ancient Mesopotamia this has proved to be a very short timeline for such a fundamental re-engineering of corporate statements and opposition to the whole package is gathering, like belligerent Klingons, on the starboard bow of the directive. 'How long do you need, Scottie?" "Five thousand years, Cap'n." "You can have two.' Opposition to the proposal among businesses of all sizes has deepened and as result of intensive lobbying the European Parliament realising that resistance was futile, 'set their phasers to stun' and voted overwhelmingly to 'stop the clock', allowing all stakeholders time and space to catch their breaths and reset the implementation tempo and strategy. The original timeline for full implementation has been extended in by two years and the number of companies that will be subject to the directive has been reduced. The amendment to the directive reclassifies 'large' companies to those whose activities are more likely to impact human rights, and the environment will be impacted. The new threshold means that companies with more than 5,000 employees and net turnover exceeding US$1.6bn are now subject to the directive and are expected to begin reporting from 2028. These changes also mean that 80% of the companies originally targeted for inclusion in the programme are now off the hook. Additionally, the transposition of the directive into national law has also been extended by another year. Since the 2024 due date has passed, only Bulgaria, Czechia, Denmark, Ireland, France, Croatia, Italy, Lithuania, Hungary, Romania, Slovakia, and Sweden have met the target date for national legislation. Twelve down, still fifteen to go. While the recent amendments are not exactly a 'full power restart', they at least provide some much-needed wriggle room for Kirk to navigate the Enterprise away from those pesky Klingons. Other problems with the directive which may in the longer term be deeper than the noisy business issues were identified in an article published last December by Cambridge University Press, (The Unintended Consequences of the EU Corporate Sustainability Due Diligence Directive). In it, ESG lawyer Jowita Mieszkowska, argued that the CS3D directive could turn out to be a hat trick of own goals. Firstly, she points to the possibility that companies will withdraw from countries with problematic human rights because the risk of EU sanction leading to negative economic outcomes for regions that most need the investment. Second is the sheer regulatory overhead of implementation might divert capital from more productive and ethical uses. Thirdly, the directive might in fact weaken even stronger national legislation. For instance, Germany would actually have to dilute the impact of it's 'Supply Chain Act' to conform with the provisions of CS3D. Peter Burke, Minister for Enterprise, Tourism and Employment, welcomed the deferral, saying that he 'strongly supports the simplification and burden reduction agenda that is being led by President von der Leyen at European level, to maximise the competitiveness of businesses in the EU in the evolving global trading environment. These proposed changes will of course significantly help enterprise in Ireland, and most of all our SMEs.' The CS3D directive is a key element of the overarching 'Green Deal' strategy; businesses of meaningful size must provide clear and reliable information on their performance against environmental, social and governance (ESG) mandates. Mr Burke will now have to amend the Irish legislation to accommodate the changes enforced by a missed schedule and the elephant in the room has been pushed into a dark corner where it will be neither seen nor heard. The intent of CS3D was after all to help stop the planet growing warmer by reducing sustainability-related risks and promote climate neutral economic transitions in accordance with the 2015 Paris Agreement. These noble aims have been sidelined amid all the political and administrative turmoil and First Officer Spock might reasonably ask: How will this help planet earth to live long and prosper?
Yahoo
27-05-2025
- Business
- Yahoo
Experts warn of disturbing factory conditions still happening years after disaster: 'This needs to be reversed'
Twelve years have passed since the Rana Plaza building collapse in Bangladesh killed 1,138 people and injured more. However, garment industry workers and advocates say major fashion brands are still dragging their feet on meaningful reform. Nonprofits like the Clean Clothes Campaign (CCC) and the Bangladesh Revolutionary Garment Workers Federation (NGWF) are sounding the alarm over stalled progress on workplace safety in the world's second-largest textile-producing country. Many brands tied to factories in the Rana Plaza — including Walmart, Urban Outfitters, and Amazon — have still not taken full responsibility, advocates say. "Twelve years since the Rana Plaza collapse, it is vital that worker safety remains safeguarded," said Salahuddin Shapon, president of the Bangladesh NGWF, to Just Style. He warned that factory safety committees are weaker now due to a 2022 labor code amendment that reduced workers' rights and gave more power to factory owners. "This needs to be reversed," he said. After the collapse, more than 260 brands signed the Accord on Fire and Building Safety, a legally binding agreement for five years to improve factory conditions. But many major brands never signed on. Despite the international attention, dangerous working conditions, poverty wages, and union suppression remain widespread in Bangladesh's fast fashion supply chain. The CCC reports that only a few of the 30 brands linked to the Rana Plaza disaster have made meaningful contributions to worker protections since. These problems are not isolated. They're built into the fast fashion model, which churns out massive volumes of cheap, low-quality clothing designed to wear out quickly and be replaced. This results in a flood of textile waste that ends up in landfills and our environment, all while workers remain stuck in unsafe, underpaid jobs, hurting progress towards a healthier, greener future for all. Bangladesh has seen some progress, including a 2022 Employment Injury Scheme that provides limited support to injured workers and their families, and major strikes last year that resulted in 18 worker demands being met by owners. Still, advocates say stronger labor laws around workers' rights and injury compensation are urgently needed. "These 12 years have shown that real change can only happen if brands' behaviors and practices are regulated by robust legal obligations," said Kalpona Akter, labor leader and founder of the Bangladesh Centre for Worker Solidarity, to Just Style. What should the government do about the fast fashion industry? Set strict regulations Incentivize sustainable options Use both regulations and incentives Nothing Click your choice to see results and speak your mind. One promising step via global effort is the Corporate Sustainability Due Diligence Directive, a European policy that will require brands to take responsibility for their supply chains by 2026. But consumers also have the power to change things right now. Shopping secondhand at thrift stores or online, or supporting transparent, ethical brands, can help save money and reduce demand for fast fashion's exploitative practices. Join our free newsletter for good news and useful tips, and don't miss this cool list of easy ways to help yourself while helping the planet.
Epoch Times
23-05-2025
- Business
- Epoch Times
EU Plans to Slash Red Tape for Medium-Sized Companies
The European Commission is creating a new category of companies that will be exempted from some rules as part of its ongoing effort to slash red tape. On The creation of the new category of company means that they are granted exemption from some laws on data protection and net-zero rules. The EU said that when companies grow beyond 250 employees, they become large enterprises under the current rules and face a sharp increase in compliance obligations. It said that this 'cliff-edge' can discourage growth and limit competitiveness. There are nearly 38,000 companies now potentially classed as small mid-caps in the EU. Related Stories 5/21/2025 4/13/2025 Some of the measures include simplifying the record-keeping obligation in the EU's 2018 personal data GDPR law. About 10,000 small businesses will no longer have to fill out EU climate paperwork for selling or importing items such as used cars with air-con gas, under the new rules planned for 2026. 'Cutting red tape and simplifying rules means giving businesses the freedom to innovate, grow, and create jobs,' Executive Vice-President for Prosperity and Industrial Strategy Stéphane Séjourné said in a statement. The tech lobby group Computer and Communications Industry Association (CCIA) Europe said that the changes were too minor. 'Easing GDPR requirements for small and mid-sized companies may offer limited relief, but this minor change falls far short of addressing the deeper structural issues that plague the EU's data protection framework,' 'At best, today's proposal will ease GDPR burdens for just 0.2 percent of EU companies. While well-intentioned, its limited scope means it won't meaningfully strengthen Europe's dwindling digital competitiveness. These are cosmetic fixes, not systemic solutions.' The EU Commission has already proposed reforms to the law to reduce red tape for European businesses. The call from the EU's biggest economies comes as the bloc rolls out its 'Simplification Omnibus,' which aims to enable the 27-nation alliance to compete with countries such as the United States and China. On Feb. 25, European Commission President Ursula von der Leyen 'This will make life easier for our businesses while ensuring we stay firmly on course toward our decarbonization goals. And more simplification is on the way,' she said. The European Commission, the bloc's executive arm, aims to reduce reporting burdens by 25 percent in an initial wave of measures in the first half of 2025. It said this would translate into savings of 40 billion euros ($42 billion) for European companies. France and Germany recently called on the EU to scrap a supply chain audit law. The Corporate Sustainability Due Diligence Directive (CSDDD), approved in May 2024, establishes far-reaching mandatory human rights and environmental obligations on both EU and non-EU companies meeting certain turnover thresholds, starting from 2027. While requiring companies to make environmental and human rights checks on their direct suppliers, the law also forms part of the European Green Deal. Companies will be required to adopt and implement a French President Emmanuel Macron said on U.S. President Donald Trump has also committed to a red tape-cutting strategy after establishing the Department of Government Efficiency (DOGE) in January to root out fraud, waste, and abuse within the federal government. The task force has a deadline to complete its work by July 4, 2026, but senior presidential adviser and Tesla boss Elon Musk
Epoch Times
21-05-2025
- Business
- Epoch Times
Macron, Merz Call to Scrap EU's Supply Chain Sustainability Law
The leaders of France and Germany have called on the European Union to scrap a supply chain audit law. The Corporate Sustainability Due Diligence Directive (CSDDD), approved in
Irish Examiner
17-05-2025
- Business
- Irish Examiner
Europe wants to become more efficient and cut red tape: Is ESG now at risk?
Europe has an innovation problem. In recent years, a widening gap in Gross Domestic Product (GDP) has opened between Europe and the US, underpinned primarily by a slowdown in productivity growth on this side of the Atlantic. On a per capita basis, real disposable income has grown almost twice as much in the US as in the EU since 2000, according to former European Central Bank (ECB) president Mario Draghi, whose eye-opening analysis, published last year, detailing Europe's challenges has drastically influenced the European Commission's policy agenda. In the report, Mr Draghi warned Europe had largely missed out on the digital revolution, led by the internet and its subsequent productive gains. The productivity gap between Europe and the US is largely explained by the tech sector. Only four of the world's top 50 tech companies are European, and as Draghi notes: 'The EU is entering the first period in its recent history in which growth will not be supported by rising populations. Former president of European Central Bank Mario Draghi warned Europe had largely missed out on the digital revolution, led by the internet and its subsequent productive gains. Picture: AP/Michael Probst 'To digitalise and decarbonise the economy and increase our defence capacity, the investment share in Europe will have to rise by around five percentage points of GDP to levels last seen in the 1960s and 70s. This is unprecedented. If Europe cannot become more productive, we will be forced to choose. We will not be able to become, at once, a leader in new technologies, a beacon of climate responsibility and an independent player on the world stage. 'We will not be able to finance our social model. We will have to scale back some, if not all, of our ambitions. This is an existential challenge.' The only way to meet this challenge is for the EU to grow and become more productive. According to Draghi, this will require radical change. While extensive, the Draghi report can be boiled down to three necessities for the EU to boost its competitiveness: Closing the innovation gap, decarbonising the economy, and reducing dependencies on non-EU entities. With the threats outlined by Draghi fresh in the mind of policymakers, the European Commission launched its competitiveness compass at the beginning of this year, describing it as a new roadmap to restore Europe's dynamism and boost economic growth. Part of the commission's strategy is to cut red tape, help companies adopt new technologies like AI and robotics, and simplify rules and laws for companies operating across the EU. But the simplification process of regulatory requirements has been met with pushback by legal scholars, who claim efforts to strip back some of the commission's Corporate Sustainability Due Diligence Directive, which was proposed as part of an omnibus bill put forward in February, are quite risky. The warning comes from more than 30 legal scholars across the EU and UK, who want EU lawmakers to rethink their planned revision of environmental, social, and governance (ESG) due diligence requirements, according to a letter addressed to the European Parliament. Of particular concern to the legal scholars behind the letter is the treatment of so-called transition plans. These are supposed to require companies to document how they will cut emissions in line with the EU's 2050 net-zero goal, which the bloc has enshrined in law. Vincent McCarthy of Invesco: 'We have to make sure that we care about the type of companies that exist across Europe. The fact of the matter is, many unsustainable business practices are still too profitable.' However, the current wording of the omnibus proposal appears to drop a requirement obliging companies to put transition plans into effect. 'Competitiveness and sustainability are not opposing forces,' says Vincent McCarthy, founder of ESG Ireland and the Responsible Investment Institute, a platform dedicated to ESG integration and sustainability education. 'The EU is currently behaving like they are. Developing more resilient companies and enhancing competitiveness cannot be the cover used to roll back on regulation,' Mr McCarthy told the Irish Examiner. Pressure to scale back regulations has come from Germany and France amid concerns European companies will be too burdened by regulatory requirements to compete with US and Asian rivals. This has been largely supported by the Commission's president Ursula von der Leyen, who has made clear she also wants to cut red tape, with the likely outcome being a slimmed-down framework for ESG requirements across the 27-member bloc. 'Simplifying rules shouldn't mean just rolling back on them,' says Mr McCarthy. As for European companies, many seem to agree. A survey conducted by WeAreEurope, an apolitical collective of European professionals, found just over half of the 1,000 companies it surveyed were dissatisfied with the EU's omnibus simplification, which the organisation said 'directly contradicts' the narrative laid out by business lobby groups and policymakers. In addition, the group also found European companies largely rejected the idea the Corporate Sustainability Due Diligence Directive placed them at a global disadvantage. Instead, many point to a lack of guidance as the main issue hindering growth. 'The commission says it cannot impinge on competitiveness because we will be left behind, but these are not the issues companies across Europe are struggling with,' says Mr McCarthy. 'In addition to this, we have to make sure that we care about the type of companies that exist across Europe. The fact of the matter is, many unsustainable business practices are still too profitable.' Scared of missing out on the next digital revolution, the European Commission is heavily pushing AI and encouraging companies to adopt new technologies through its AI initiatives. According to the EU, its newly-launched InvestAI initiative will mobilise €200bn for investment in AI and set up a new fund of another €20bn for AI gigafactories. But as Mr McCarthy notes, the environmental impact of increased AI adoption must also be considered. 'If we are going to lead on AI, which the EU has said it wants us to, we need to know the sustainability impact of that,' the ESG Ireland founder notes. Data centres, which house AI servers, are major consumers of water and rely on rare elements and minerals that are often mined unsustainably. Globally, AI-related infrastructure may soon consume six times more water than Denmark, a country of six million people, according to one study cited by the United Nations. A request made through ChatGPT consumes 10 times the electricity of a Google Search, according to the International Energy Agency. These impacts will also be felt in Ireland due to its tech hub status, with the agency estimating the rise of AI could see data centres account for almost 35% of the country's energy use by 2026. 'This seems to be venturing into dangerous territory,' Mr McCarthy says. 'The European Commission needs to refocus. It has spent the last six or seven years focusing on company disclosures and not on tackling unsustainable business activity. 'It's time to relocate capital out of unsustainable companies to ensure we innovate in the correct way. The commission needs to correct this now and not take the easy way out.' Read More Rise in low-emission slurry spreading puts Ireland on track for ammonia target
