The European Union's biggest economies are split over whether the bloc should weaken its sustainability reporting rules for companies, with Spain and Italy defending some rules that Germany and France want to delay, documents seen by Reuters showed.
The European Commission plans to publish an 'omnibus' proposal next week to simplify green rules for businesses, aiming to make local industries more competitive and respond to US President Donald Trump's promise to scrap regulations.
The proposal will address the EU's corporate sustainability reporting rules (known as CSRD), its due diligence law, and its 'taxonomy' system for labelling climate-friendly investments.
In a letter to the Commission, seen by Reuters, Spain's government urged Brussels not to weaken the due diligence law, which from 2027 will require companies to check human rights and environmental issues in their supply chains.
"It supports the values and the priorities of the European Union even beyond our borders, setting an example of leadership," said the letter, signed by Spain's Environment Minister Sara Aagesen and Economy Minister Carlos Cuerpo.
"Its revision should be avoided," it said.
Corporate Sustainability Reporting Rules
On the corporate sustainability reporting rules, Spain said the EU should delay when the policy applies to smaller companies, but that after this deadline it should become mandatory for "all companies".
Separately, Italy has urged the EU not to delay the CSRD for the tens of thousands of companies which will report under the rules this year, a letter by Italy's finance minister Giancarlo Giorgetti to the European Commission showed.
However, Rome said that smaller companies due to start reporting later, in 2026, should get more time and simpler rules than currently planned - and the EU should also delay its due diligence policy.
"Companies have identified potential risks stemming from these new [due diligence] requirements, which could weigh on their competitiveness," said the letter, dated February 6.
The interventions by Madrid and Rome add to pressure on Brussels, which is also facing calls from Germany and France to rewrite some of its green laws. Germany, France, Italy and Spain are the EU's four biggest economies.
Germany in December called for a two-year delay to the CSRD – which it said would affect 13,000 German companies – among other changes. France last month asked the EU to delay indefinitely its due diligence rules and to delay by two years the CSRD.
