EU’s new head of finance promises to streamline sustainability rules

Albuquerque will look to “adjust” requirements to reduce burden, she tells Parliament

The politician set to take charge of the European Commission’s finance agenda has promised to “work towards streamlining” the bloc’s corporate sustainability requirements.  

Maria Luís Albuquerque is preparing to be questioned next month by Members of European Parliament (MEPs), who get the final say on whether she will become the new Commissioner for Financial Services, Financial Stability and the Capital Markets Union.

Last week, Real Economy Progress reported on leaked documents showing that Parliament wants to know what Albuquerque plans to do to increase the interoperability of the EU’s sustainable finance rules and reduce the burden on companies.

The former Portuguese finance minister (pictured below) has now responded, according to a document published on European Parliament’s website ahead of the final hearings, scheduled for November 4-12.

“If I am confirmed as Commissioner, I will… work towards streamlining requirements to alleviate unnecessary burdens, without compromising on our common European Green Deal objectives,” said Albuquerque.

She added that it was clear that, currently, it would be a mistake to introduce significant new requirements.

“But we probably need to adjust existing ones and fine-tune requirements and regulations to make them fit for purpose.”

In addition, “targeted reviews” should be undertaken “to simplify and facilitate the application of the framework,” continued Albuquerque.

She was not explicit about which laws she was referring, although elsewhere in her answers she namechecks the European Sustainability Reporting Standards, Taxonomy and EU’s Green Bond Standard.

Last week, Real Economy Progress revealed that Mairead McGuinness, whom Albuquerque is expected to replace as finance commissioner, had urged Member States to help reduce the burden created for companies by the Corporate Sustainability Reporting Directive, and ensure national supervisors were not heavy-handed with enforcement.

A senior Commission official also recently stressed the controversial reporting rules should not be “over-implemented”.

The comments are part of efforts by the Commission to steady the ship, as pro-business politicians across Europe move to dismantle CSRD and the EU Taxonomy.

Today, right-wing MEPs tabled a debate in Parliament on “the need to axe unnecessary burden and reporting”.

During that discussion, Klára Dostálová, an MEP from the Czech Republic, described the EU’s ‘green transformation’ agenda as a “tool of economic self-sabotage” and “a death sentence for many companies”.

Left-wing Dutch MEP Lara Wolters, hit back, arguing that “the vast majority of our companies know that to survive in tomorrow’s economy, they must become sustainable”.

“What they need is a level playing field, quality data to base their decisions on, and legal certainty. And how are we helping them now? We’re not,” she continued.

“This debate, organised by the centre-right and co-sponsored by the far-right, creates uncertainty. What does a company do if we make a law here, and then, months later, we place a question mark over it? Does it start to prepare? Does it wait?”

Albuquerque suggested in her written responses that she would “build on the framework [already] in place” for sustainability, rather than axing any parts.

“Given the urgency to act, the toolkit has been developed in a relatively short time,” she wrote, claiming that “early signs are broadly encouraging”, but the Commission needs to listen to feedback.

Her remarks also noted the importance of interoperability under the next Commission – both in respect to different parts of the EU’s sustainable finance agenda, and between different jurisdictions with similar rules.

“We need to ensure that disclosures and transition planning requirements for companies are coherent across the whole framework,” she said.

Parliament will have a chance to ask follow-up questions during the November hearings, before voting in the second half of November. Albuquerque is widely-expected to be approved.