Environment, Safety & Governance
European Parliament votes to delay rules for due diligence, sustainbility reporting
In December 2025, the European Parliament approved a provisional agreement between the members of the European Parliament and EU governments on updated sustainability reporting and due diligence rules for companies.
The revamped rules will apply to fewer companies and reduce some obligations for firms, thus strengthening EU competitiveness.
Only EU companies employing on average more than 1,000 employees and with a net annual turnover of over €450 million will have to carry out social and environmental reporting. The rules will also apply to non-EU companies with net turnover in the EU of over €450 million and to their subsidiaries and branches generating turnover higher than €200 million in the EU.
Not only will reporting requirements be significantly simplified, but sector-specific reporting will become voluntary. Co-legislators ensured that companies required to prepare sustainability reporting will not shift that responsibility to their smaller business partners. Firms with fewer than 1,000 employees will not have to provide information to their bigger business partners beyond what is included in the voluntary reporting standards. To facilitate compliance, the European Commission will establish a digital portal with access to templates and guidelines on EU and national reporting requirements.
Fewer companies will need to carry out due diligence on reducing their negative impact on people and the planet. Under the revised rules, this will only be required from large EU corporations with more than 5,000 employees and a net annual turnover of over €1.5 billion and for non-EU companies above the same turnover threshold in the EU. They will have to carry out scoping exercises to identify risks in their chain of activities, and they should only ask for information from business partners with fewer than 5,000 employees when the information for in-depth assessment cannot be obtained another way.
Transition plans ensuring a company’s business model is compatible with the shift to a sustainable economy will no longer be required. Businesses will be liable at the national level for failures to apply the rules correctly and could face fines of up to 3% of the firm’s net worldwide turnover.
The due diligence directive will only apply from 26 July 2029 for all businesses within its scope.
The text was adopted with 428 votes in favor, 218 against and 17 abstentions. The updated sustainability rules are part of the Commission’s Omnibus I simplification package and still must be formally adopted by the European Council.
EPA extends industry deadlines for Clean Air Act rules
In November, the US Environmental Protection Agency (EPA) extended several compliance deadlines in the Biden-Harris Administration’s Clean Air Act rules for the oil and gas industry, commonly known as OOOOb/c. The extension aims to provide more realistic timelines for owners and operators of new and modified oil and natural gas sources. The EPA estimates this action will save an estimated $750 million over 11 years in compliance costs.
In July 2025, the EPA had issued an interim final rule (IFR) extending compliance deadlines in the 2024 New Source Performance Standards (NSPS) and Emissions Guidelines. This IFR included extending the deadline to meet certain requirements related to control devices, equipment leaks, storage vessels, process controllers and covers/closed vent systems for 18 months following the publication of the IFR in the Federal Register. This remains unchanged.
Also unchanged are the 18-month extensions given to states to create plans for reducing methane emissions from existing oil and natural gas sources and for the implementation of the 2024 rule’s “super emitter” program, which requires third parties using EPA-approved remote-sensing technology to provide the EPA with data on potential large leaks.
Following a public comment period and hearing on the July 2025 IFR, the EPA is extending the 28 November 2025 deadline, by 180 days, for net heating value continuous monitoring requirements and alternative performance test option for flares and enclosed combustion devices. This addresses the supply chain, personnel and laboratory limitations that were identified and would have made compliance infeasible.
The IFR previously had extended this to 120 days. To ensure clarity, EPA is providing 360 days from the effective date of this final action for owners and operators to submit all annual NSPS OOOOb reports that were originally due prior to this deadline.
