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On 20 November 2025, the European Commission proposed major changes to the Sustainable Finance Disclosure Regulation (SFDR) to simplify disclosures and strengthen investor protection. The new framework introduces three product categories—Transition, Sustainable, and ESG Basics—each requiring a 70% investment commitment and exclusion of harmful industries. Simplified two-page templates will replace current disclosure rules, and entity-level obligations like principal adverse impacts are removed.
Only products in these categories may use sustainability-related terms in marketing. Taxonomy disclosures become optional, with a 15% safe harbor for aligned assets. Application is expected 18 months after adoption, likely in 2028, marking a significant shift toward clearer, stricter sustainability standards.

Until recently, the EU lacked a specific framework governing green claims. A new Directive aiming at “empowering consumers for the green transition” supplements the existing rules on unfair commercial practices to include a new harmonized regime for green claims, applicable from September 2026. Businesses should carefully consider how this new regime will impact their upcoming commercial communications, including voluntary environmental reports and climate targets, to mitigate legal and reputational risks.

The Committee on Employment and Social Affairs of the European Parliament recently published a draft report on digitalisation, AI and algorithmic management in the workplace. It makes a number of recommendations including for a directive specifically regulating ‘algorithmic management’ in the workplace with protections extending to self-employed individuals in addition to workers. There are a number of steps in the EU legislative process before these proposals could become legally binding. Given their significance, including the broad definition of ‘algorithmic management’, impacted organisations should nevertheless monitor if and how they develop.

In brief On 16 June 2025, the Council of the European Union and the European Parliament reached a political agreement on a new regulation introducing additional procedural rules for the enforcement of the General Data Protection Regulation (GDPR) in cross-border matters (“Regulation”). The new Regulation seeks to fix the delays and inconsistencies…