Sustainable Finance

“Simplification” has been the watchword dominating regulatory headlines in 2025.

Whilst you might have thought that the previous roll-out of sustainability legislation in the EU was rapid, those changes look sedentary now when compared with the lightning-speed at which the Commission put out its first Omnibus package. The Commission has started 2025 with a bang, shifting into a new gear with its competitiveness agenda driven by President von der Leyen. Within the space of less than two weeks, the Commission moved from a proposal which was merely a square-bracketed placeholder to a full-blown proposal (with significant potential implications for sustainability reporting).

Now, it’s certainly fair to say that the Omnibus has not been met with universal approval. What some call “simplification”, others call “deregulation” – and the negotiation of the Omnibus in the Council and the European Parliament is likely bring political and ideological tensions to the surface. The European Parliament is due to vote on the “stop the clock” proposal of the Omnibus Package on 1 April 2025 and we will be closely following developments in the months ahead.

Now more than ever, it is therefore important that we work together as an industry, across jurisdictions, to seek solutions that strike the right balance for market participants; that resolve usability challenges in regulatory frameworks; and that work to effectively channel capital to deliver on global transition. To support our members in this mission in Q1, we responded to the UK’s Taxonomy consultation, put out our Position Paper on the Omnibus proposal and held various discussions with regulators and members on regulatory matters.

Our recently released (and first-ever) Sustainable Finance Insights Report also seeks to find solutions – this time to the challenges of navigating greenwashing risk in the loan markets. It goes without saying that ensuring the credibility and integrity of sustainable finance structures must be a top priority for all. Nonetheless, we must find ways to ensure that perfection does not become the enemy of the good, and that market participants are able to effectively engage on sustainability issues to ensure: (i) that lending activities can be aligned to business and investments strategies, (ii) that they are able to comply with their own regulatory and reporting obligations and (iii) that they are able to assess financial risk exposures related to sustainability matters.

If you’d like to find out more about our Insights Report or how you can get involved in our sustainable finance regulatory work, please do get in contact with me.