What does the new European Commission have in store for sustainability?

The new European Commission started work on 1 December 2024. This marks the start of a new five-year mandate (December 2024 to October 2029). So what does this mean for the future of the EU’s sustainability agenda?

Two key, competing, trends are emerging:

• The need to boost the EU’s competitiveness and growth, while still “staying the course” on the core objectives of the European Green Deal and the decarbonisation agenda
• The need to simplify regulatory burdens for businesses (in particular sustainability reporting burdens) without straying too far into deregulation 

(See our Key Takeaways section below.)

Von der Leyen’s Political Guidelines set the overarching direction of travel 

In July 2024, Ursula von der Leyen, who was elected for a second term as President of the European Commission, presented her Political Guidelines setting out the key priorities for the new Commission in the next five years, with a new plan for Europe’s “sustainable prosperity and competitiveness”.

In particular, the Political Guidelines proposed (among other things):

• the creation of a new Clean Industrial Deal in the first 100 days of the new Commission which will include an Industrial Decarbonisation Accelerator Act and a new Circular Economy Act;
• a review of the existing EU Climate Law through a proposal for a 90% emissions reduction target for 2040; 
• a potential review of the 2035 CO2 standards for cars and vans to include technology-neutral options;
• a review of the REACH chemicals regime; and
• an EU water resilience strategy.

On reducing red tape, the Political Guidelines say the Commission will need “to make business easier and faster” in Europe – with “speed, coherence and simplification” being key political priorities. All Commissioners will be tasked with focusing on reducing administrative burdens and simplifying implementation: “less red tape and reporting”.   

The Political Guidelines say that the Commission President will also draw on the Draghi report on EU competitiveness (see our previous blog post). The Draghi report raised concerns that the EU’s sustainability reporting and due diligence framework is a major source of regulatory burden, magnified by a lack of guidance and lack of clarity surrounding its interaction with other legislative acts, and that this entails a major compliance cost for companies in the EU. The report singles out the Corporate Sustainability Reporting Directive (CSRD), the Taxonomy Regulation, the Sustainable Finance Disclosure Regulation (SFDR), and the Corporate Sustainability Due Diligence Directive (CSDDD).

The need to reduce red tape was confirmed in Von der Leyen’s speech at the European Parliament on the new College of Commissioners: 

“For Europe to catch up, we will also need to make things easier for our companies. They are telling us that the regulatory burden weighs heavily on them. Too much reporting. Too many overlaps. And too complex and costly to comply with. We need to streamline our rules to reduce the burden on businesses. And we need to give legal certainty about what we expect from them. And this is why I have asked one of our most experienced Commissioners, Valdis Dombrovskis, to take the lead on simplification and implementation. He will also be responsible for boosting Europe's economy and productivity. I can announce that one of our first steps in the new mandate will be a new omnibus legislation. We will look at different sectors and assess the European legislation.”

New Commissioners and their missions  

The key sustainability players in the new Commission are as follows:   

• Teresa Ribera Rodríguez is in charge of the competition portfolio and will also oversee climate and competition policy as Executive Vice-President for a “clean, just and competitive transition”. 
  • Her Mission Letter (as well as the Mission Letters to the other Commissioners) stressed that the success of the new Commission will be measured against the ability to meet the targets and objectives set in the European Green Deal, and she, together with other Commissioners, will be responsible for ensuring that “existing rules are fit-for-purpose and focus on reducing administrative burdens and simplifying legislation”. In particular, Ms Ribera, along with other Commissioners, must “contribute to reducing reporting obligations by at least 25% - and for SMEs at least 35%”.
  • Ms Ribera will coordinate the work on the Clean Industrial Deal. 
  • She will also guide the work on the implementation of the existing legal framework to help reach the EU’s 2030 targets. Once the 90% emission-reduction target for 2040 has been included in the European Climate Law, Ms Ribera and the Commission will need to prepare a new framework beyond 2030 to enable the EU to reach net-zero by 2050. 
  • Commission President Von der Leyen is expected to publish a Competitiveness Compass on 15 January 2025, which is a framework to increase EU competitiveness following the recommendations in the Draghi report centred around three pillars: closing the innovation gap with US and China; a joint plan for decarbonisation and competitiveness; and increasing security in the EU.

• Stéphane Séjourné is responsible for Prosperity and Industrial Strategy. 
  • He is tasked with developing (jointly with Commissioner Hoekstra) the Clean Industrial Deal with a focus on decarbonisation, clean technologies and incentivising investment. The Clean Industrial Deal expected to be published on 26 February 2025. 
  • Mr Sejourne is also tasked with presenting an Industrial Decarbonisation Accelerator Act and will also lead on the implementation of the existing Net Zero Industry Act. 
  • He will also be responsible for presenting a Circular Economy Act (jointly with Commissioner Roswall) within the first 100 days of the Commission’s new mandate, to create market demand for secondary materials and a single market for waste. 
  • Mr Sejourne will also be taking the lead on the “Omnibus simplification package” which is also expected to be published on 26 February 2025 (see below for more detail). 

• Wopke Hoekstra, the Commissioner for Climate, Net Zero and Clean Growth, will contribute to the Clean Industrial Deal (jointly with Executive VP Sejourne). 
  • He will be responsible for making a proposal to enshrine the 90% emission-reduction target for 2040 in the European Climate Law and preparing a climate policy framework for beyond 2030. 
  • Mr Hoekstra will also be responsible for the build-up of a single market for CO2 and will lead  the work to conclude negotiations on the revision of the Energy Taxation Directive.

• Jessika Roswall, the Commissioner for Environment, Water Resilience and a Competitive Circular Economy has been tasked with ensuring the EU develops a clean, circular economy. 
  • She will lead on a Circular Economy Act (jointly with Commissioner Sejourne). Ms Roswall will need to prioritise the design of incentives for nature positive actions and private investment, and will lead the work on nature credits. 
  • She will also lead on a new chemicals industry package and the European Water Resilience Strategy.

• Dan Jørgensen is the Commissioner for Energy and Housing tasked with bringing down energy prices, boosting the roll-out of renewable energy and energy storage, upgrading grid infrastructure, including developing a strategy on investment in clean energy infrastructure and developing a resilient, interconnected and secure energy system. 
  • He will oversee and support the implementation of the existing legal framework for 2030. 
  • Mr Jørgensen will also need to make proposals to incentivise and increase the uptake of carbon capture utilisation and storage.

• Maria Luís Albuquerque, the Commissioner for Financial Services and the Savings and Investments Union, is tasked with implementing the sustainable finance framework, with particular focus on transition finance. 
  • She will need to explore ways to promote the development and transparent categorisation of financial products and services with sustainability features and lead the work on the review of the Sustainable Finance Disclosure Regulation (SFDR).

• Valdis Dombrovskis, the Commissioner for Economy and Productivity, and Implementation and Simplification, has been tasked with reducing administrative and reporting burden, simpler implementation and better enforcement. He will lead the work to stress-test the EU acquis with a view to eliminate overlaps and contradictions.

• Michael McGrath will be responsible for Democracy, Justice, the Rule of Law and Consumer Protection. 
  • He will be in charge of implementing the Corporate Sustainability Due Diligence Directive (CSDDD / CS3D). 
  • At his confirmation hearing with the European Parliament, the Commissioner stood firm on the CSDDD’s scope and timeline for implementation but he recognised the need for clarity and guidance from the Commission on the CSDDD.

The new European Commission is expected to publish its Annual Work Programme for 2025 on 11 February 2025, which will outline key actions for the year, including new proposals and reviews of existing legislation - see Register of Commission Documents. 

One of the key initiatives mentioned in that Register is the “Omnibus simplification package” – which is expected to be published on 26 February 2025.  For more information on that, see our separate blog post: EU Omnibus Regulation: what do we know so far? 

KEY TAKEAWAYS 

• The new Commission has been tasked with boosting EU competitiveness and reducing the regulatory burden on businesses while not backtracking on the core objectives of the European Green Deal and decarbonisation agenda. Or to put it more bluntly: cutting red tape and boosting growth without killing the Green Deal.  
• Key to this mission will be the flagship Competitiveness Compass (expected on 15 January 2025) and the Clean Industrial Deal (expected on 26 February 2025). 
• As for other key initiatives, we will have more detail once the Commission has published its Annual Work Programme on 11 February 2025.
• Some have argued that the Commission went too far, too quickly with the tsunami of new legislation in its previous mandate and that it is now trying to backpedal with its “simplification revolution”. 
• Others argue that when you introduce big sweeping new regulatory changes like the Commission did in its previous mandate, it is inevitable that you then need to have a phase focused on implementation of the new rules. 
• All eyes will be on the “Omnibus simplification package” when this is published on 26 February 2025. At present, there is a great deal of uncertainty as to what exactly that package will do and its format. 
• The Commission will have a difficult job balancing the need to reduce red tape and streamline sustainability reporting burdens without straying too far into the camp of deregulation.  
• The political dynamics of the new European Parliament elected this summer (where centre-right and populist parties gained ground), combined with recent/impending changes of government in several EU Member States, is likely to mean it will be harder and it will take longer to agree new legislation or make changes to existing legislation going forwards. 
• We are about to embark on a more volatile political era – both within the EU and further afield. We would do well to prepare for the unexpected.