‘Disastrous race to the bottom’: Reactions to EU Parliament adoption of sustainability Omnibus

One day after the European Parliament voted to dilute sustainability rules for companies, defenders of the European Green Deal have shared their disappointment at what they see as a step backwards for Europe’s sustainability agenda.

After unexpectedly rejecting the European Commission’s Omnibus proposal last month, MEPs finally adopted it yesterday (November 13), with 382 votes in favour of the proposal, 249 against and 13 abstentions.

MEPs agreed on a trilogue negotiating position that seeks to reduce the scope of the Corporate Sustainability Reporting Directive (CSRD) to companies with more than 1,750 employees and of the Corporate Sustainability Due Diligence Directive to those with 5,000 employees (instead of the Commission’s initial proposal of 1,000) and €1.5 billion in turnover.

Richard Gardiner, Interim Head of EU Policy at ShareAction, said: “Today’s vote risks not only gutting the impact of landmark laws like the CSDDD and CSRD but also drives a stake through the heart of Europe's wider sustainability agenda. What we’re witnessing isn’t just a watering down of ambition, but a public alliance of political forces fundamentally opposed to sustainability itself.

“This is happening at a moment when the realities of climate breakdown and social injustice demand more courage, not less. Yet, once again, short-term profits for the largest companies are being placed above the long-term well-being of the planet and its people,” he added.

‘A troubling decision’

Environmental NGOs showed concern about the future of corporate climate action in Europe, and about the consequences of inaction for people around the world.

“These laws that provided hope, security, and promise for a fairer and more sustainable future have been reduced to performative exercises that have little effect on the real needs of people, nature, and businesses. This is not a time to slow down on our path to a more sustainable economy, but the EU is moving in reverse”, said Mariana Ferreira, Sustainable Finance Policy Officer at WWF European Policy Office.

Rainforest Alliance regretted the “troubling decision to narrow the company scope and remove climate transition plans”, and added: “The Parliament missed the opportunity to make a difference for millions of people around the world – including the 600 million smallholder farmers who produce about one-third of the world’s food.”

The UN Principles for Responsible Investment warned that the proposals risk hindering the EU's economic transition and setting back its future competitiveness. “Rather than simplify EU corporate sustainability policies, they will create additional complexity and cost for investors and companies,” the group added.

Beate Beller, EU Senior Campaigner at Global Witness, called the vote “a devastating and dark day for European democracy”, particularly regretting the decision to remove the obligation to adopt climate transition plans in the CSDDD.