EU’s Competitiveness Compass Proposes Regulatory Simplifications For Sustainability

The European Commission has published the Competitiveness Compass, outlining initiatives to support European Union (EU) competitiveness and economic growth over the next five years.

The Competitiveness Compass addresses three priorities: closing the innovation gap, promoting decarbonisation, and reducing external dependencies. The goal is to align regulatory requirements with investor needs while reducing reporting burdens by at least 25% for all companies and 35% for SMEs. A key initiative in this effort is the Omnibus Simplification Package, scheduled for release on 26 February 2025.

This package aims to streamline sustainability regulations, including the Corporate Sustainability Reporting Directive, the Corporate Sustainability Due Diligence Directive, and the Green Taxonomy Regulation. While not legally binding, the Competitiveness Compass provides insight into future sustainability compliance and reporting requirements in the EU.