Sustainability and due diligence: EP approves postponement of new rules

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🗞️ Driving the news: The European Parliament has approved a one-year delay to the implementation of EU due diligence rules and a two-year postponement for sustainability reporting requirements
• The vote—531 in favour, 69 against—supports the Commission’s “Stop the clock” initiative aimed at simplifying regulation and boosting EU competitiveness
• The directive affects large companies with significant environmental and human rights responsibilities across their supply chains

🔭 The context: Due diligence rules require companies to identify, prevent, and mitigate harm caused to people and the environment through their operations
• The new timeline gives EU member states until 26 July 2027 to transpose the directive into national law
• Sustainability reporting deadlines for large and listed SMEs have also been pushed to 2028 and 2029, respectively

🌍 Why it matters for the planet: Postponing sustainability rules delays corporate transparency on environmental and social impacts during a critical period for climate action
• While simplification may aid businesses, it also risks slowing the momentum behind corporate accountability in supply chains and ESG progress
• The delay may affect global efforts to align finance and trade with sustainable development goals 

⏭️ What's next: The European Council, which already supports the revised timeline, must now formally adopt the proposal for it to become law
• Parliamentary review of the scope and content of the rules will continue in the Legal Affairs Committee
• Implementation discussions and corporate preparations are expected to resume with renewed urgency in 2026

💬 One quote: “These are pragmatic changes aimed at reducing burdens without weakening sustainability goals,” — summary of the EU Commission’s rationale behind the postponement

📈 One stat: 531 MEPs voted in favour of the delay to the due diligence and sustainability reporting timelines

See here detailed sustainability performance of companies like TotalEnergies, Nestlé, and Siemens

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