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EU extends certain ESG regulations to U.S. companies (2024)
| Environmental, social, and corporate governance |
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| • What is ESG? • Enacted ESG legislation • Arguments for and against ESG • Opposition to ESG • Federal ESG rules • ESG legislation tracker • Economy and Society: Ballotpedia's weekly ESG newsletter |
The European Union's (EU) Corporate Sustainability Due Diligence Directive (CSDDD) will require certain U.S. companies to comply with ESG-related measures and regulations by 2026. As covered previously in Economy and Society, some European corporations argued against the EU's regulatory approach promoting ESG, claiming it hinders their competitiveness and valuations. According to Forbes:
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EU regulators included a wild card in the CSDDD’s complex deck. The American Bar Association reported in July that the Corporate Sustainability Due Diligence Directive adopted by the EU will require US companies with over €450 million in revenue in the EU to comply with a vast suite of EU regulatory actions, including the CSDDD and other ESG-related measures, by 2026. The Wall Street Journal estimates that as many as 10,000 non-EU-based companies will have to comply, 31 percent of which are American companies. … Concerned about a lack of action from the Biden/Harris administration to protect American companies from this bit of foreign intervention into their business activities, 28 members of congress, all Republicans, wrote a letter to Treasury Secretary Janet Yelen [sic] last year. The letter points out that the Treasury Department has historically 'defended American interests from the extraterritorial reach of foreign regulators,' and asks Yelen to provide information about what, if anything, Treasury is doing to intercede in this matter. Yelen seemed to respond to the letter the next day, saying, 'We’re looking very carefully at the EU’s corporate sustainability directive, and we’re concerned about the impact it could have on US firms. We’re consulting with the EU and making clear that we’re concerned about the directive’s extra-territorial scope.' The matter has remained dormant, at least publicly, since.[1] |
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See also
- Environmental, social, and corporate governance (ESG)
- Economy and Society: Ballotpedia's ESG newsletter
External links
Footnotes
- ↑ Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
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