German Chancellor pushes EU to scrap Corporate Sustainability Due Diligence law

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🗞️ Driving the news: German Chancellor Friedrich Merz has called on the European Union to fully abandon the Corporate Sustainability Due Diligence Directive (CSDDD), pledging that Germany will revoke its national implementation
• The directive, a key component of the EU’s ESG agenda, mandates large companies to prevent human rights and environmental abuses across their supply chains

🔭 The context: Adopted in 2023 and set for enforcement in 2028, the CSDDD was designed to hold companies accountable for supply chain impacts, including forced labor and environmental harm
• It has strong backing from civil society but faces criticism from some businesses over compliance costs and competitive disadvantages
• Merz, representing the pro-business CDU, is pushing for regulatory rollbacks, aligning with wider deregulatory trends across the EU

🌍 Why it matters for the planet: Weakening or cancelling the CSDDD could undermine one of the EU’s most ambitious tools for advancing corporate accountability on climate and human rights
• The directive is vital for promoting responsible supply chains and ensuring that sustainability standards are enforced beyond EU borders
• Its reversal would risk greenwashing, reduce leverage over global ESG compliance, and set a precedent for backtracking on hard-won social and environmental protections

⏭️ What's next: Germany’s stance could prompt a broader pushback within the EU against due diligence laws, potentially jeopardizing the 2028 implementation timeline
• The move intensifies political debate over the future of ESG regulation ahead of the next European Commission cycle
• Stakeholders in Brussels will closely watch whether other member states follow Germany’s lead, or whether Parliament and civil society push back to preserve the directive

💬 One quote: “We will revoke the national law in Germany. And I also expect the European Union to follow suit and really cancel this directive,” — Chancellor Merz

📈 One stat: The CSDDD is set to cover over 13,000 EU-based companies and roughly 4,000 non-EU firms operating in the bloc by 2028

See on illuminem's Data Hub™ the sustainability performance of leading German companies Siemens, Allianz, and Volkswagen

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