Why the EU rollback doesn’t threaten sustainability

So far, 2025 has been tumultuous for sustainability teams, to say the least. In case you missed it, the headlines have mainly focused on EU climate-related reporting requirements being rolled back or simplified.

This has left many sustainability teams reeling, as they relied on legislation to push their boards to allocate much-needed resources into corporate sustainability.

Now, without that legislative push, they find themselves without a motive.

What has happened?

In June, we saw two big pieces of EU Sustainability legislation amended by the EU Commission. The first being further amendments to the Omnibus package, namely on CSRD (Corporate Sustainability Reporting Directive) and CSDDD (Corporate Sustainability Due Diligence Directive). For the CSRD, while the 1,000-employee threshold remains (for now), the EU Commission have announced a new threshold of €450 million to apply. For CSDDD, the thresholds will be much higher, applying only to businesses with over 5,000 employees and €1.5billion net turnover.

The second piece of news to emerge from the EU Commission in the last month was the last-minute discussion on whether the EU Green Claims Directive would come into effect. Despite now saying the Directive would not be withdrawn, there is still uncertainty over its future.

Both these updates reflect the EU Commission’s goal to reduce reporting burdens on larger businesses by 25% by 2029.

This begs the question: Is the purpose of legislation to drive forward progress or set guardrails?

If your business is relying on legislation to drive forward progress, you may now find yourself in a tricky spot.

How can we move beyond this moment in time?

First, we must acknowledge this is a moment in time. Sustainability as a topic is now being debated more widely than ever before. It has become a political issue, something that politicians are now choosing to weaponise alongside other social topics like housing infrastructure and financial budgets.

Businesses should use this time to focus on developing a strong sustainability strategy that represents business impacts and how these are addressed, regardless of regulatory requirements. True sustainability leaders will see this not as a setback but as an opportunity to differentiate themselves and demonstrate genuine commitment. These recent legislative pauses offer a chance to refine internal strategies and integrate sustainability deeply into core business operations, rather than treating it as a compliance exercise.

There is still an opportunity to drive change if you choose to embrace it

The recent adjustments to EU sustainability legislation might feel like a step backwards for some, but there is also an opportunity here for meaningful change. Businesses should be fundamentally motivated to drive change to remain competitive, and this motivation should exist independently of regulatory pressure.

In a world increasingly conscious of environmental and social impact, companies that genuinely embed sustainability into their operations are better positioned to innovate, reduce risks, and enhance their brand reputation. Those that recognise this will help push each other forward through market forces, rather than being dragged by legislation that doesn’t always grasp industry-specific challenges.

The EU may be tackling the climate crisis like a Dad’s Army, but if you’re waiting for legislation to bring your business up to standard, you’ve already missed the opportunity to lead the way. The real leaders in sustainability are those who proactively embrace it as a core business imperative, understanding that it’s not just about compliance, but about long-term resilience, competitive advantage and positive impact. The EU’s recent actions, rather than signalling a threat to sustainability, can be a catalyst for businesses to forge unique, more robust paths forward.

Get in touch

If you’d like to discuss this, or any other subject, please get in touch with Katy Fuller, Head of Sustainability, at katy@gather.london

We’d love to know what you think.