The EU has introduced sweeping ESG regulations under the European Green Deal, aiming to enhance corporate sustainability, accountability, and transparency. However, recent political shifts have led to delays, revisions, and ongoing debates, creating uncertainty for businesses navigating compliance.
What this means for in-house counsel
Review vigilance plans both as operational compliance tools and disclosure documents
Courts are increasingly scrutinising the quality of risk mapping, assessment procedures, stakeholder engagement and follow-up mechanisms.
Apply heightened review processes to all ESG-related communications
Sustainability claims, climate commitments, transition plans and more generally any public statements (including online on corporate websites and marketing / commercial documentation) should be supported by clear evidence and remain up-to-date and consistent with underlying business practices.
Maintain contemporaneous evidence supporting ESG-related decisions and claims
Increasing regulatory and litigation scrutiny means that companies should be able to demonstrate not only what commitments were made, but also the underlying analyses, data points, assumptions, governance processes and implementation measures supporting those commitments.
Ensure close coordination between legal, compliance, sustainability, business, marketing and communications teams
ESG risks do not sit within a single function. Courts, regulators and claimants increasingly assess whether sustainability commitments, corporate disclosures, due diligence processes and public communications are aligned. Cross-functional governance can help prevent inconsistencies between what a company says and what it actually does, reducing exposure to greenwashing, disclosure and vigilance-related claims.
Monitor shifting timelines
The Omnibus I amendments have narrowed the scope of the CSRD and CS3D and postponed key deadlines, while national implementation in Germany and other Member States is still pending. Companies should review whether and when they fall within scope and adjust their ESG strategy accordingly.
Ensure flexibility in compliance planning
Obligations under existing national laws such as the LkSG remain in force until they are replaced. Companies should maintain their due diligence processes and internal documentation while preparing for the transition to the amended EU framework.
Watch for legislative updates
National transposition laws, the revised ESRS and Commission guidelines under the CS3D will determine the practical requirements in the coming years.
