- Published at
Monday Morning Briefing CW 20, 2025

Key regulatory, market, and corporate developments shaping sustainability and ESG in Europe and beyond.
Table of Contents
- Regulatory News
- EU Relaxes Car CO₂ Targets
- Legal Concerns Over EU Sustainability Law Changes
- Investors Warn Against Deep Data Cuts in Green Regulations
- Market Trends
- Global ESG Funds Experience Significant Outflows
- Australian Investors Defy Global ESG Backlash
- U.S. Companies Roll Back ESG Commitments
- Company News
- Capgemini Updates ESG Policy
- Google and Dow Partner on AI Recycling Technology
- United Airlines Invests in Sustainable Aviation Fuel
- IKEA Appoints New Chief Sustainability Officer
- Outlook for the Week Ahead
May 12, 2025
Regulatory News
EU Relaxes Car CO₂ Targets
The European Parliament approved a relaxation of CO₂ emissions targets for cars and vans, allowing automakers to average emissions over 2025–2027 instead of just 2025. This change offers manufacturers more flexibility amid the transition to electric vehicles.
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Legal Concerns Over EU Sustainability Law Changes
Proposed amendments to EU sustainability laws, including the removal of mandatory emissions reduction plans, have sparked warnings from legal scholars. They caution that such changes could increase the risk of lawsuits against companies.
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Investors Warn Against Deep Data Cuts in Green Regulations
EU investors have expressed concerns over potential reductions in data requirements within green regulations. They argue that significant cuts could undermine transparency and the effectiveness of sustainability reporting.
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Market Trends
Global ESG Funds Experience Significant Outflows
In Q1 2025, global ESG funds suffered outflows totaling $8.1 billion, with the U.S. leading the downturn at $6.1 billion in withdrawals. This marks the 10th consecutive quarter of outflows for U.S. ESG funds, driven by rising political backlash and regulatory uncertainty.
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Australian Investors Defy Global ESG Backlash
Contrasting global trends, Australian and New Zealand investors contributed $300 million to ESG funds in Q1 2025. This regional resilience is attributed to continued support from institutional investors, despite global skepticism.
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U.S. Companies Roll Back ESG Commitments
Several U.S. firms are scaling back ESG goals amid political backlash and legal uncertainty. This includes reducing transparency around board demographics and withdrawing from diversity and inclusion initiatives.
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Company News
Capgemini Updates ESG Policy
Capgemini has updated its ESG policy, adding a stronger focus on ethics and setting new targets for achieving net-zero emissions. This move reflects the company’s commitment to integrating sustainability into its core operations.
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Google and Dow Partner on AI Recycling Technology
Google and Dow have partnered to develop AI-powered sorting technology aimed at recycling hard-to-process plastics. This collaboration seeks to enhance circular economy efforts and reduce plastic waste.
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United Airlines Invests in Sustainable Aviation Fuel
United Airlines has invested in Twelve, a company that transforms CO₂ into sustainable aviation fuel. This investment aligns with United’s goals to reduce carbon emissions and promote sustainable travel.
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IKEA Appoints New Chief Sustainability Officer
Inter IKEA Group has appointed Lena Julle as its Chief Sustainability Officer, effective May 1, 2025. Julle’s appointment reinforces IKEA’s commitment to achieving net-zero emissions and advancing circular business practices.
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Outlook for the Week Ahead
- EFRAG’s May 9 webinar will focus on ESRS implementation challenges and stakeholder input.
- Corporate sustainability results are due from BMW Group, Unilever, and Vestas, offering early signals on CSRD preparedness.
Sources:
- Reuters – EU Relaxes Car CO₂ Targets
- Reuters – Legal Concerns Over EU Sustainability Law Changes
- Reuters – Investors Warn Against Deep Data Cuts
- Morningstar – Global ESG Funds Suffer Outflows
- The Australian – Australian Investors Defy ESG Backlash
- Reuters – U.S. Companies Roll Back ESG Commitments
- ESG News – Capgemini, Google-Dow, United Airlines, IKEA
This article was created with the assistance of AI and carefully reviewed, edited, and refined to ensure accuracy and clarity.