What's Happening in Sustainability & ESG (Week Recap 04.02 - 10.02) 🌎

This week’s read time: 8 minutes

Welcome to this edition of Green Digest, where you will get updated about everything happening in the Sustainability & ESG space in less than 10 minutes. 🌎

We go through tons of articles and data from the most reliable sources, filter & simplify them, and serve them to you in bite-sized chunks every week. 🍀

In this edition, we’ll cover:

• The first CSRD reports have been published, with companies from Denmark leading the way 🇪🇺

• The EU may significantly narrow the scope of CSRD, potentially exempting companies with fewer than 1,000 employees—removing 85% of businesses from reporting obligations 🇪🇺

• Google contracted over $100 million in carbon removal credits in 2024 🌳

• Google, Amazon, and Accenture are among the latest major corporations to scale back or eliminate DEI initiatives 🇺🇸

• Energy companies Orsted and Equinor are both scaling back their renewable energy investment plans by 25% and 50%, respectively ⚡️

• and other news 🌍

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THIS WEEK’S TOP NEWS

Regulatory Oversight & Industry Insights

📑 Over the past two weeks, the first CSRD reports have been published, with companies from Denmark leading the way. Early reporters include Novo Nordisk, Vestas, Tryg, Mærsk, Pandora, Lundbeck, and others. While this marks a significant step toward greater transparency, early feedback from the sustainability community highlights challenges, including inconsistencies, unclear materiality assessments, hard-to-find impact disclosures, inconsistent auditor reviews, missing value chain assessments, and others. For those looking to explore CSRD-compliant reports, the Sustainability Reporting Navigator (SRN) has compiled an open-source CSRD Report Archive, where stakeholders can browse and contribute to a list of published reports for fiscal year 2024. You can find the full list of reports here.

🇪🇺 The EU’s Platform on Sustainable Finance (PSF) published a new report with recommendations to simplify the EU Taxonomy, aiming to reduce companies’ reporting burden by a third. The EU Taxonomy, which classifies sustainable economic activities, has been in effect since 2022 for climate-related disclosures and 2024 for broader environmental objectives. The PSF’s four core proposals include simplifying corporate reporting, refining the green asset ratio (GAR), easing compliance with Do No Significant Harm (DNSH) criteria, and improving SMEs’ access to sustainable finance. Key recommendations involve introducing lighter compliance assessments, a “comply or explain” approach for certain KPIs, and allowing proxies and estimates in reporting. The proposals aim to make sustainable finance more effective while maintaining regulatory integrity.

Responsible Investor (RI) also reported that ongoing omnibus discussions may significantly narrow the scope of CSRD to align with CSDDD, potentially exempting companies with fewer than 1,000 employees—removing 85% of businesses from reporting obligations. Additionally, the principle of double materiality may be at risk, with a possible shift toward single (financial) materiality. Key aspects of CSDDD, including climate transition plans and civil liability, are also under discussion. The publication of the omnibus proposal is now expected in March rather than the originally planned February 26.

The EU may also scale back its carbon border levy (CBAM) to cover only 20% of companies, as they account for 97% of emissions under the scheme. The proposal, suggested by EU Climate Commissioner Wopke Hoekstra, aims to reduce administrative burdens while maintaining climate goals. CBAM, set to take effect in 2026, will impose CO₂-based fees on imported steel, aluminum, and cement, but businesses and trade partners criticize its complexity and economic impact.

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MORE INTERESTING NEWS

Latest developments, reports, insights, and trends

🌎 Many major polluters, including the EU, China, and India, missed the UN deadline to submit updated climate targets, raising concerns about stalled global climate action. The Paris Agreement signatories were due to submit new emissions reduction plans by Monday, but several major economies failed to do so, while the US under Trump is expected to abandon its Biden-era commitments. Despite this, UN climate chief Simon Stiell expects most countries to submit plans later this year, citing the $2 trillion clean energy investment boom as a motivator. The EU, India, and China cite bureaucratic or study-related delays, while some officials fear Trump’s climate rollback is disrupting global efforts.

💰 Jeff Bezos’s $10 billion Earth Fund has ended its support for the Science Based Targets initiative (SBTi) after December 2024, amid concerns over its influence and potential efforts to align with President Trump. Sources suggest the move reflects Bezos’s broader effort to strengthen ties with Trump’s administration. Meanwhile, SBTi is diversifying its funding sources, and its incoming CEO, David Kennedy, will assess future financial partnerships. The Bezos Earth Fund remains a major climate donor, previously granting $18 million to SBTi and $2.5 billion to climate initiatives, including the Greenhouse Gas Protocol and World Resources Institute (WRI), which continues to engage with the fund.

🇺🇸 The Trump administration’s rollback of climate policies continues to escalate, with cuts to environmental justice programs, a suspension of federal EV charging investments, and legal challenges to state-led climate accountability measures. The EPA placed 168 environmental justice staff on leave, while the DOJ laid off employees and halted environmental litigation, aligning with Trump’s efforts to curb DEI and climate regulations. Meanwhile, the administration suspended the $5 billion EV charging station program, pausing new spending under Biden’s NEVI initiative, despite critics arguing that withholding congressionally approved funds may violate federal law. At the same time, 22 Republican-led states are suing New York over its new $75 billion climate superfund law, which mandates fossil fuel companies pay for climate damages based on past emissions. The lawsuit mirrors a similar legal battle in Vermont, with Republican officials calling it an unconstitutional overreach. These moves reflect a broader shift toward deregulation, while states like New York push forward with corporate climate accountability.

WHAT ARE COMPANIES DOING?

Corporate sustainability, new tools and services & companies in the news

🌳 Google has significantly increased its carbon removal investments, contracting over $100 million in carbon removal credits in 2024—three times its original $35 million pledge. The company is supporting a wide range of solutions, including enhanced rock weathering (ERW), biomass capture, biochar, direct air capture (DAC), and natural carbon sink restoration to help scale the sector. Google is also part of Frontier, a buyer coalition for high-quality carbon removal, and in May 2024, co-founded Symbiosis with Meta, Microsoft, and Salesforce to support up to 20 million tons of nature-based removals. While encouraged by its progress, Google acknowledges that carbon removal is still in its early stages and plans to continue expanding its investments in scalable climate solutions. Similarly, LEGO Group is investing $3.3 million in carbon removal projects through partnerships with Climate Impact Partners and ClimeFi. The company, along with its parent firm KIRKBI, is supporting biochar, enhanced rock weathering, and reforestation initiatives, with carbon credits delivered between 2024 and 2026.

🇺🇸 Google, Accenture, and Amazon are among the latest major corporations to scale back or eliminate DEI initiatives, citing legal and political shifts in the US. Google announced it will no longer pursue DEI hiring and representation goals, aligning with new regulations affecting federal contractors following the Supreme Court’s affirmative action ruling and executive orders under Donald Trump. Similarly, Accenture is phasing out its DEI targets, first set in 2017, and discontinuing demographic-specific career programs amid political and regulatory pressures. Meanwhile, Amazon removed references to diversity and inclusion from its 2024 annual report and is winding down DEI programs by the end of the year, integrating them into broader talent strategies focused on “proven outcomes. These rollbacks reflect a wider corporate shift as companies navigate increasing scrutiny and legal threats against DEI policies, while some state attorneys general push back in defense of civil rights protections.

⚡️ Energy companies Orsted and Equinor are both scaling back their renewable energy investment plans, citing rising costs, supply chain challenges, and a tougher market environment. Orsted announced a 25% cut to its 2030 investment program, lowering planned spending to $29.3-$32.1 billion and withdrawing its 2030 renewable capacity target. The company, under new CEO Rasmus Errboe, is slowing new project construction and restructuring its workforce, reflecting financial strain from its US offshore wind portfolio. Meanwhile, Equinor is making even deeper cuts, slashing renewable and low-carbon investments by 50% between 2024-2027 and abandoning its goal to allocate 50% of capital expenditures to renewables by 2030. The company also reduced its renewable energy capacity target and scaled back its net carbon intensity reduction goals, prioritizing financial sustainability over rapid expansion. Both companies’ decisions signal broader challenges for the offshore wind and clean energy sector, as inflation, high interest rates, and regulatory uncertainty force a more cautious investment approach.

🏦 HSBC appointed Julian Wentzel as Group Chief Sustainability Officer, replacing Celine Herweijer, amid broader management changes under CEO Georges Elhedery. Wentzel, who previously led HSBC’s global banking for the Middle East, North Africa, and Turkey, will report to CFO Pam Kaur, rather than the executive committee, raising concerns among climate activists about HSBC’s shifting sustainability priorities. HSBC unveiled its first net-zero transition plan in 2023, but major banks now face policy uncertainties and increasing scrutiny under Donald Trump’s presidency.

EVERYTHING FINANCE

Sustainable finance, funding rounds, acquisitions & private equity deals

⚡️ BNP Paribas directed 76% of its 2024 energy financing toward low-carbon energy, up from 65% in 2023 and 54% in 2022. The bank aims to reach 80% low-carbon energy financing by 2028 and 90% by 2030, covering renewables, biofuels, and nuclear energy. Its credit exposure grew to €37 billion, nearing its €40 billion target by 2030. BNP Paribas also increased low-carbon transition financing to €179 billion since 2022, moving toward its €200 billion by 2025 goal.

🏦 Australia’s Macquarie Group exited the UN-backed Net-Zero Banking Alliance (NZBA), following a wave of withdrawals by North American banks after Donald Trump’s return as US President. The company did not specify its reasons but will update its climate strategy in May 2025. Despite these departures, major Australian banks—Westpac, ANZ, Commonwealth Bank, and NAB—remain in the alliance, along with HSBC, Barclays, Deutsche Bank, and DBS Bank.

🤝🏻 TPG will acquire Altus Power, the largest US commercial-scale solar owner, in a $2.2 billion all-cash deal. Founded in 2009, Altus Power operates over 1 GW of solar capacity across 25 states, providing clean energy to businesses, towns, and homes. The acquisition will be made through TPG Rise Climate’s Transition Infrastructure strategy, which focuses on investments in energy transition, green mobility, and sustainable fuels.

Funding rounds:

⚡️ X-Energy raised $700 million in a Series C-1 round to accelerate the development of its small modular nuclear reactor (SMR) technology. The Maryland-based company develops advanced nuclear reactors and TRISO-X fuel, designed to enhance safety by preventing fuel failure.

🟢 Circularity tech startup Archive raised $30 million in a Series B round to expand its resale platform for brands. Founded in 2021, the California-based company helps brands develop and manage resale programs, enabling higher-margin secondhand sales through returns, trade-ins, past inventory, and consumer listings. Archive partners with 50+ brands, including The North Face, New Balance, and Dr. Martens.

⚡️ IONATE raised $17 million in a Series A round to expand its smart electric transformer technology and launch US operations. Founded in 2019 in London, the company develops smart grid solutions to handle distributed energy sources like solar, EVs, and heat pumps, increasing grid capacity without upgrading infrastructure.

💧 Swiss startup Oxyle raised $16 million to scale its breakthrough solution for destroying PFAS “forever chemicals” in wastewater. Founded in 2020, the Zurich-based company offers a low-energy, three-stage process that achieves over 99% PFAS elimination without requiring incineration or landfilling, unlike conventional methods that risk recontamination.

⚡️ Energy storage software startup Tyba raised $13.9 million in a Series A round to enhance its AI-powered optimization platform for energy storage providers. Founded in 2020, the California-based company offers AI/ML-based tools to improve bidding strategies, automate energy storage management, and support project development.

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