What's Happening in Sustainability & ESG (Week Recap 14.01 - 20.01) 🌎

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:

• Companies and organizations push back against the EU's Omnibus proposal 🇪🇺

• Trump withdrew the US from the Paris Agreement and declared an energy emergency 🇺🇸

Companies continue their sustainability efforts:

• Google signed the largest biochar-based carbon removal agreements to date 🟢

• Amazon announced a $1 billion investment to electrify and decarbonize its transportation network across Europe 🚚

• and other news 🌍

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THIS WEEK’S TOP NEWS

Regulatory Oversight & Industry Insights

🇪🇺 The EU’s “Omnibus Simplification Package,” set to be proposed on February 26, with input from member states beginning January 21, aims to reduce regulatory burdens by amending key sustainability laws, including the Corporate Sustainability Reporting Directive (CSRD), the Corporate Sustainability Due Diligence Directive (CSDDD), and the Taxonomy Regulation. Intended to streamline overlapping regulations and foster economic growth, the initiative has sparked debate among companies, stakeholders, and policymakers. Its introduction coincides with significant geopolitical developments, such as Donald Trump’s renewed presidency and Europe’s ongoing economic challenges.

What is the Omnibus Simplification Package?

The Omnibus initiative is designed to harmonize EU sustainability laws, cutting reporting obligations by 25% by mid-2025, with a strong focus on reducing complexity for SMEs. Led by European Commission President Ursula von der Leyen, it seeks to simplify administrative requirements while preserving the overall goals of the Green Deal. However, concerns remain that these efforts could inadvertently weaken robust sustainability frameworks.

The proposal has faced reactions from multiple fronts:

• Businesses: A coalition of 11 major companies, including Nestlé, Unilever, and Mars, fears that reopening agreed legislation could undermine sustainability standards, disrupt investments, and erode legal predictability. Companies that have already invested heavily in adapting to current regulations argue that renegotiation risks creating unnecessary uncertainty.

• Civil Society: Over 160 organizations, including human rights defenders and environmental activists, warn that the Omnibus could dilute the Green Deal’s accountability measures, increase exploitation, and harm environmental protections. They call for adherence to current timelines and greater transparency in the legislative process.

• SMEs and International Critics: Many SMEs view existing frameworks as disproportionately burdensome, while US lawmakers and trade groups have criticized the extraterritorial reach of EU regulations, further complicating the debate.

Risks of Simplification

Critics warn that the Omnibus package carries significant risks, including:

1. Regulatory Backsliding: Efforts to simplify could lead to deregulation, undermining critical environmental and social protections.

2. Implementation Gaps: With several laws not yet fully implemented, insufficient data exists to justify adjustments, adding to legal and operational uncertainty.

3. Business Disruption: Companies already aligned with current frameworks may face increased costs and confusion if rules are modified mid-implementation.

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MORE INTERESTING NEWS

Latest developments, reports, insights, and trends

🇺🇸 On his first day in office, US President Donald Trump initiated sweeping rollbacks of Biden-era climate policies, marking a sharp pivot towards fossil fuel development and deregulation. His key actions included:

1. Exiting the Paris Agreement: Trump withdrew the US from the international accord to combat climate change, criticizing it as unfair and harmful to American industries. This move raised concerns about global emissions and diminished US leadership in climate diplomacy.

2. National Energy Emergency Declaration: He declared an energy emergency, enabling streamlined approvals for oil, gas, and power infrastructure projects, aiming to boost domestic fossil fuel production and address rising energy demand, including from AI-driven industries.

3. Promoting Oil and Gas: Trump lifted restrictions on Arctic drilling and reversed Biden’s ban on offshore oil and gas development. He also reinstated permits for liquefied natural gas (LNG) exports, prioritizing energy dominance.

4. Halting Wind and EV Progress: Offshore wind leasing was suspended pending review, and Biden’s 50% EV target for 2030 was revoked. Federal funds for EV charging infrastructure were also frozen.

These measures, coupled with proposed changes to climate regulations and the dismantling of Biden-era sustainability initiatives, signal Trump’s renewed focus on bolstering fossil fuel industries and reducing environmental restrictions. Critics warn of increased emissions, legal challenges, and risks to global climate goals. Prior to Trump’s inauguration, the Biden administration secured approximately 84% ($96.7 billion) of clean energy grants from the Inflation Reduction Act (IRA) by signing contracts with recipients, safeguarding these funds from potential clawbacks under the Trump administration.

The US Federal Reserve also announced its withdrawal from the Network of Central Banks and Supervisors for Greening the Financial System (NGFS), citing its expanded scope as exceeding the Fed’s statutory mandate. The Fed joined the NGFS in 2020 to explore integrating climate risks into monetary policy and financial system oversight but emphasized that climate change policymaking falls under Congress’s purview. The decision aligns with Republican skepticism of climate-focused regulation and was made ahead of President Trump’s inauguration. Similarly, five of Canada’s largest banks—TD Bank, Scotiabank, Bank of Montreal, National Bank of Canada, and Canadian Imperial Bank of Commerce—have exited the UN-sponsored Net-Zero Banking Alliance (NZBA), joining six major US banks.

Despite the sweeping rollbacks of climate policies under President Donald Trump, not all is doom and gloom. States like New York are stepping up with ambitious climate investments, demonstrating that progress is still possible at the state level. New York Governor Kathy Hochul announced over $1 billion in climate investments aimed at decarbonizing the state’s economy, focusing on renewable energy expansion, low-carbon buildings, and green transportation. Key initiatives include advancing nuclear energy, with support for Constellation Energy’s small modular reactor project and the development of a Master Plan for Responsible Advanced Nuclear Development. Hochul emphasized the plan’s dual focus on sustainability and economic growth, aiming to create jobs, cut energy costs, and reduce pollution.

WHAT ARE COMPANIES DOING?

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

🟢 Google signed the largest biochar-based carbon removal agreement to date, committing to purchase 200,000 tonnes of carbon removal credits by 2030 from India-based Varaha and California-based Charm Industrial. Biochar, made by heating biomass without oxygen, sequesters carbon for centuries and enhances soil fertility. Varaha focuses on smallholder farmers, using invasive species like Prosopis juliflora to produce biochar while improving ecosystems and agricultural productivity. Charm, known for bio-oil sequestration, will now also offer biochar, highlighting its ecosystem benefits.

🚚 Amazon announced a $1 billion investment to electrify and decarbonize its transportation network across Europe, including its largest-ever order of over 200 electric heavy goods vehicles (eHGVs) from Mercedes-Benz Trucks. These zero-emission trucks, part of Amazon’s Climate Pledge to reach net-zero carbon emissions by 2040, will operate on high-mileage routes in the UK and Germany, transporting over 350 million packages annually. Amazon also plans to expand its fleet of electric delivery vans in Europe from 3,000 to 10,000 by 2025 and is enhancing heavy vehicle charging infrastructure to support its transition.

♻️ Ingka Investments, the investment arm of Ingka Group, the largest IKEA retailer, announced a €1 billion investment in companies advancing recycling infrastructure to support the transition to a circular economy. The initiative aims to address the global resource imbalance, where 75% more natural resources are consumed than the Earth can regenerate, and less than 20% of waste is recycled. The focus is on increasing the availability of recycled materials, avoiding millions of tonnes of CO₂ emissions, and promoting circularity in materials like plastics, textiles, wood, and food. Since 2017, Ingka Group’s Circular Investments have recycled 2.7 million tonnes of materials and avoided over 9.4 million tonnes of CO₂ emissions.

🤝🏻 Schneider Electric joined the Partnership for Carbon Accounting Financials (PCAF) as the first global sustainability consultant in its accredited partnership program. This collaboration aims to help banks and investors measure and report financed emissions using PCAF’s harmonized standards, advancing decarbonization efforts in the financial sector. Schneider Electric will leverage its expertise in sustainability consulting to enhance GHG accounting and integrate decarbonization strategies into investment portfolios.

EVERYTHING FINANCE

Sustainable finance, funding rounds, acquisitions & private equity deals

🇪🇺 The European Investment Bank (EIB) and Societe Generale launched a clean energy financing initiative to mobilize up to €8 billion for Europe’s wind energy supply chain. The plan includes a €500 million EIB counter-guarantee, enabling Societe Generale to create €1 billion in bank guarantees to support wind farm projects, supply chains, and grid connections across the EU. Backed by InvestEU and part of the EIB’s €5 billion wind power package, the initiative aims to address challenges like high costs and supply chain disruptions, accelerate wind energy development, and support the EU’s goal of generating 45% of its energy from renewables by 2030.

🤝🏻 Apollo and Standard Chartered announced a strategic partnership to accelerate global financing for infrastructure, clean energy transition, and renewable energy projects. The initiative will leverage Apollo’s ACT Capital and Apterra platform, alongside Standard Chartered’s financial resources and expertise, to deploy up to $3 billion in transition financing across various sectors. Standard Chartered has also acquired a minority stake in Apterra and will provide a senior secured credit facility to ACT Capital.

📈 Schroders has been awarded a £5.2 billion ($6.3 billion) sustainable investment mandate by St. James’s Place (SJP) to manage the SJP Sustainable & Responsible Equity fund. Schroders will manage the mandate using its Global Sustainable Value Equity and Global Sustainable Growth strategies, both of which adopt the UK FCA’s sustainability label.

🔌 British startup Aegis Energy secured a £100 million investment to develop five multi-energy refueling hubs for commercial vehicles. These stations, set to open between 2026 and 2027 in key English cities, will offer a range of clean energy options, including electric charging, hydrogen, hydrotreated vegetable oil (HVO), and biomethane fuels. Aegis plans to build up to 30 such stations by 2030.

🚙 Harbinger, a California-based electric vehicle chassis manufacturer, raised $100 million in a Series B funding round to scale production of its medium-duty electric truck platform. Founded in 2021, Harbinger develops a ready-to-use chassis designed for commercial walk-in vans, RVs, box trucks, and more, offering improved energy efficiency, safety, and cost parity with traditional vehicles after federal incentives.

🚢 Clean fuel tech startup Amogy raised $56 million in venture financing to advance its ammonia-based, emission-free power solutions targeting the decarbonization of heavy transportation, maritime, and power generation sectors. Recently, Amogy demonstrated its technology’s potential by successfully sailing the world’s first ammonia-powered maritime vessel, the NH3 Kraken.

🟢 London-based carbon credit ratings startup BeZero Carbon raised $32 million to expand its market presence, enhance its capabilities, and grow its team. Founded in 2020, BeZero provides independent carbon ratings, research, and data products, serving customers across 30+ countries and offering insights on over 480 carbon credit projects.

🌳 NatureMetrics, a UK-based biodiversity measurement and monitoring provider, raised $25 million in a Series B funding round. Founded in 2014, NatureMetrics uses cutting-edge environmental DNA (eDNA) technology to analyze DNA traces from water or soil samples, enabling businesses to measure and report their impact on ecosystems and comply with regulatory frameworks like the TNFD, CSRD, and SBTN.

⚡️ Munich-based energy management software provider ecoplanet raised €16 million in a Series A funding round to expand its AI-powered energy orchestration solution across Europe. Founded in 2022, the company helps businesses reduce energy costs, optimize renewable energy usage, automate processes, and ensure regulatory compliance, managing over 2 TWh of energy consumption across 2,000+ sites.

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