On April 9, 2025, the CDU/CSU and SPD agreed on a coalition agreement for the next four-year legislative term. The agreement also contains political plans that will affect the sustainability reporting landscape.
With a view to cutting bureaucracy, the agreement states that directives and regulations such as the EU Deforestation Regulation (EUDR), the reporting requirements under the CSRD and the EU Taxonomy, and the Carbon Border Adjustment Mechanism CBAM are to be significantly reduced and simplified.
The national German Supply Chain Act (LkSG) is to be repealed and eventually replaced by the European Corporate Sustainability Due Diligence Directive (CSDDD). However, under the European Commission's so-called “stop-the-clock” Omnibus proposal, the CSDDD will only take effect from mid-2028. This creates a “pause” of several years in Germany when it comes to large companies' reporting obligations on their supply chains.
Overall, the coalition parties SPD, CDU and CSU support the European Commission's Omnibus initiative. However, it remains unclear so far whether this support extends to every specific point of the proposals or only to the overarching goal of “reducing and postponing” reporting obligations, especially for Mittelstand companies.
The stated aim of the announced measures is to give companies more legal and planning certainty.
Other relevant points in the coalition agreement on climate and ESG topics:
- Exporters of CBAM products are to receive compensation where needed so they do not suffer competitive disadvantages on the international market, possibly even through a “free allocation of certificates”.
- The coalition partners want to ensure that the EU Deforestation Regulation (EUDR) does not apply in Germany. Most recently, only a one-year postponement of the law's application to December 2025 had been implemented. Now a “zero-risk” classification is to be introduced for countries such as Germany where there is no risk of deforestation.
- Climate and economic topics are to be handled more separately in future, which is also reflected in the renewed separation of the relevant ministries.
- Climate policy is to focus on the emissions trading system ETS 2 for buildings and transport.
- Instead of a climate dividend, targeted funding programs for housing and mobility are planned.
- The coal phase-out by 2038 is still planned.
Despite these plans, the agreement reaffirms that the parties intend to stick to the goal of climate neutrality by 2045, the implementation of the Paris Agreement and the reduction of CO₂ emissions.
