A coalition of investors managing €6.6 trillion in assets is urging the European Commission to uphold the EU’s sustainable finance framework amid concerns that upcoming regulatory changes could disrupt ESG investment and carbon neutral strategies. The Omnibus package, set for introduction on February 26, may revise key sustainability policies, including the EU Taxonomy, the Corporate Sustainability Reporting Directive (CSRD), and the Corporate Sustainability Due Diligence Directive (CSDDD). 

These policies are essential for guiding capital toward green projects and net-zero initiatives. Investors warn that reopening these frameworks entirely could create regulatory uncertainty, weakening confidence in Europe’s ability to attract sustainable investment. They stress that clear, stable rules help businesses manage climate risks, identify sustainable opportunities, and align with the EU’s long-term carbon neutral strategy. 

Rather than sweeping changes, investors advocate for targeted refinements. Key recommendations include streamlining technical reporting requirements, improving data accuracy, and ensuring alignment between EU and international sustainability standards. Additionally, they propose leveraging digital solutions to ease reporting burdens and offering sector-specific guidance to help companies comply more efficiently. 

This call for regulatory stability comes as the EU faces an annual investment gap of €750-800 billion to achieve its net-zero commitments. Transparency measures are already driving significant progress, with European companies reporting €440 billion in Taxonomy-aligned capital expenditure by 2024, a number expected to rise. 

Weakening ESG regulations could hinder initiatives like the Clean Industrial Deal, which aims to strengthen Europe’s competitiveness in the global green economy. Investors emphasize that maintaining a robust and predictable framework is essential to financing the energy transition and ensuring Europe remains a leader in sustainable finance. 

With global competition for green investment intensifying, the European Commission is under pressure to safeguard ESG regulations that support long-term economic and environmental goals. Investors argue that strong, clear policies will provide businesses and financial institutions with the certainty they need to continue directing capital toward sustainable, low-carbon solutions. 

Sources:  

https://esgnews.com/investors-managing-e6-6-trillion-warn-eu-not-to-undermine-sustainability-reporting-framework/ 

https://www.reuters.com/markets/europe/investors-with-6-trillion-euros-warn-eu-not-weaken-green-rules-2025-02-03/ 

https://www.unpri.org/news-and-press/investors-warn-omnibus-package-could-weaken-eu-sustainability-disclosures-harming-investment-and-economic-competitiveness/13023.article 

https://www.ainvest.com/news/investors-with-6-6-trillion-warn-eu-don-t-weaken-green-rules-250210100dc8731dbbb27b62/