Well-intentioned, poorly executed

EU regulations aimed at improving sustainability are having the opposite effect because they tie up too many resources in companies.

The multitude of reporting obligations and regulatory requirements that have been imposed on European industry in recent years pose enormous challenges for companies in the metalworking sector. ANDRITZ Schuler has been actively committed to sustainability for years and welcomes the EU Commission's goals in principle. However, practice shows that the bureaucratic effort involved has become almost impossible to manage.

The EU Commission has also recognised this and has made proposals to simplify sustainability reporting and due diligence obligations, which are a step in the right direction. The planned changes to the Supply Chain Directive (CS3D), sustainability reporting (CSRD), the EU taxonomy and the Carbon Border Adjustment Mechanism (CBAM) are intended to reduce reporting requirements by up to 80 per cent and significantly simplify sustainability reporting standards (ESRS). Over 1,000 amendments have already been tabled in the European Parliament, and crucial negotiations are now underway. It is therefore all the more important that the substance of the simplifications is retained and not watered down.
 

The multitude of EU regulations – from deforestation and battery regulations to chemical regulations and anti-corruption directives – tie up considerable resources in companies. Specifically, this means that at least one employee is involved in the implementation of each directive. Just to calculate our direct and indirect greenhouse gas emissions (Scope 1 & 2), we have to collect around 200 data points per location and quarter. On top of that, there are six-figure certification costs every year. Different requirements depending on the country and auditor lead to additional uncertainty and make comparison difficult. As a result, there is less time and energy left for actually increasing sustainability and innovation. That cannot be what the inventor had in mind.

Let's take the Carbon Border Adjustment Mechanism (CBAM) as an example. It forces us to collect countless pages of data from suppliers every quarter, only to then enter it manually (!) into the customs portal. Many of our suppliers need our help with this, and once all the fields have been filled in, typed up and the information uploaded, we don't even know what happens to it – let alone what positive effect it is supposed to have had on sustainability.
 

Once again: we are committed to our sustainability goals, and decarbonisation is one of the three cornerstones of the ANDRITZ strategy – alongside digitalisation and service. By 2030, we aim to reduce our Scope 1 & 2 greenhouse gas emissions by 42 per cent and our Scope 3 emissions by 25 per cent compared to 2023. Between 2019 and 2024, we reduced our Scope 1 & 2 emissions by more than 50 per cent compared to 2019 – one year ahead of schedule.

In addition, ANDRITZ offers its customers resource-efficient solutions for the green transition, such as CO₂ capture technologies, plants for the production of green hydrogen and renewable fuels, solutions for battery production and textile recycling, as well as state-of-the-art press and automation solutions for metal processing that enable energy efficiency and material savings. Our commitment was recently recognised with the EcoVadis Gold Medal – placing ANDRITZ among the top five per cent of over 150,000 companies assessed worldwide.
 

Nor do we shy away from legal requirements. For example, we played a key role in developing a standardised calculation method (VDMA Standard Sheet 34178) that makes it possible to determine the carbon footprint of a machine tool in just one day. This method records greenhouse gas emissions from cradle to gate. The aim is to further develop the guideline into an internationally recognised ISO standard.
 

Firstly, predictability and reliability instead of constantly introducing new regulations that companies have to familiarise themselves with each time. Due diligence obligations should be limited to a company's own business, subsidiaries and direct suppliers, and should not extend to areas over which we have no influence.

Secondly, the requirements for data collection and processing must be improved to enable data import and avoid duplication of work, as is the case with the Carbon Border Adjustment Mechanism (CBAM). Here, too, effectiveness must be transparent in order to make the effect on sustainability comprehensible and measurable – and to show that all the effort is worthwhile.

Thirdly, national and EU-wide rules must be harmonised to prevent differences in implementation across Member States, which would otherwise lead to distortions of competition. The same rules must apply to imported machinery as to European products.
 

Sustainability is an integral part of our strategy. We want to enable green change, but in their current form, the relevant EU regulations are having the opposite effect. Many other companies in the industry have already given up in the face of excessive regulation. It is therefore high time that this rampant bureaucracy was finally brought to an end.