Reporting obligation for sustainability • Table.Briefings

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Full gas storage facilities have gained strategic importance since Russia’s war of aggression. Norway is now specifically postponing the overhaul of a production facility in order to maintain the level of natural gas exports in the summer. Germany is forging ahead with the gas of the future and now wants to assess the construction of a potential hydrogen pipeline with Norway. For the time being, however, it will be filled with blue hydrogen: natural gas. This will be accompanied by the storage of CO2 using CCS. Read more about the Minister of Economics’ U-turn announced this evening in the News section.

Everyday goods, on the other hand, are transported via trains on their way from China through Russia or Belarus to the EU. The pandemic brought a veritable railway boom, but the war has since called their reliability into question. Julia Fiedler analyzes what role Ukraine should play for transport routes.

Meanwhile, the parliamentary report on the Corporate Sustainability Reporting Directive (CSRD) has been finalized. The aim is to make it easier for the public and investors to obtain information on how a company’s business activities affect the people and the planet. The Legal Affairs Committee has adopted the report. Lukas Scheid, who also wrote an Aperopa on the first 100 days of the German government, explains what the parliamentary groups agreed on.

Parliament wants to put a stop to dark patterns. Dark patterns are a myriad of unethical little tricks used in website design, leading Users to unknowingly conclude transactions or disclose information. Torsten Kleinz wrote about the solutions discussed at a hearing.

Today’s opinion piece is about climate migration. Plans should now already be considered for migration to resettle people from endangered areas before the worst impacts materialize, write activists from three climate and human rights organizations.

Your
Manuel Berkel

Sustainability Reporting (CSRD): bureaucratic monster or transparency guarantor?

By

Lukas Knigge

CSRD is about risk minimization and environmental as well as social responsibility. To date, reporting requirements on non-financial aspects of companies lack structure and comparability. This makes it difficult for investors, policymakers, and consumers to assess the environmental and social impacts of companies.

The CSRD (formerly Non-Financial Reporting Directive – NFRD) aims to require companies to provide more stringent and detailed information about the risks of their business practices to people and the environment from 2024. Public exposure should also encourage them to develop a responsible business approach, the Commission wrote in its justification for revision. In this way, investments are also to be steered more strongly into sustainable business areas – all in the spirit of the Green Deal.

After the Council agreed on a general approach on CSRD at the end of February, the parliamentary report was adopted in the lead JURI committee on Tuesday with 22 votes in favor and one against. Rapporteur Pascal Durand (Renew) described the result as a “balanced compromise supported by a large majority of political groups”.

CSRD standards not for SMEs

The MEPs agreed that disclosed information should be made more easily accessible, more comparable and independently verifiable, and thus more reliable. The European Financial Reporting Advisory Group (EFRAG) is to be tasked with developing binding EU standards for sustainability reporting.

In doing so, the Commission’s advisory body is to take into account environmental issues, social aspects such as equality and diversity, and governance, including anti-corruption and anti-bribery. The parliamentary report envisages that EFRAG’s budget will be increased accordingly. The standards for reporting requirements developed by the panel are then to be adopted by the Commission through delegated acts.

All companies with more than 500 employees that are active in EU markets would be affected by the CSRD. The Commission had proposed including small and medium-sized enterprises (SMEs), provided they are listed (Europe.Table reported). The parliamentary report does not foresee the inclusion of SMEs for the time being, but wants to have this reviewed at a later date and allow them to comply with the standards on a voluntary basis until then. In addition, companies are to be given an extra year to prepare for the new reporting requirements, so that the first report would be due in 2025 for the 2024 financial year.

Further review in high-risk sectors

Shadow rapporteur for the Greens, Marie Toussaint, regrets that SMEs are not to be covered by the CSRD: “Especially if they operate in high-risk sectors such as the extractive sector, agriculture, the textile industry or the financial sector.” At least, Toussaint says, a review clause has been introduced, with which Parliament calls on the Commission to establish additional criteria for reporting in such high-risk sectors.

For the conservative camp in the EU Parliament, on the other hand, the exclusion of SMEs is a success: It should not be forgotten “that sustainability information is not so easy to measure and record,” says Axel Voss, legal policy spokesman for the EPP Group. This would present companies with a huge challenge. Nevertheless, Voss fears “unleashing a new bureaucracy monster in Europe” if some points are not changed in the trilogue negotiations. For example, he is calling for sustainability reports not to be audited separately from conventional auditing and for subsidiaries to be granted an exemption from reporting requirements.

Numerous NGOs and public institutions – including Eurosif – had previously warned of a possible postponement of the reporting requirements. This is problematic for the Green Deal and the urgent need to reduce Europe’s dependence on fossil fuels from Russia, writes the Alliance for Corporate Sustainability. The fact that SMEs are not to be covered by the CSRD is also met with incomprehension. This would leave out 99.8 percent of the economy, criticizes Julia Linares Sabater, sustainable finance policy officer at WWF’s European Policy Office.

Hearing on Dark Patterns: is a paradigm shift necessary?

Only critics had the floor at the hearing. As committee chair Anna Cavazzini pointed out, the parliamentarians had also invited industry representatives, but none of the companies asked wanted to take part in the deliberations. The criticism of current industry practices became correspondingly fundamental.

Ari Waldman, a professor at Northeastern University, described the design tricks, that have become particularly widespread through cookie banners, as constitutive of “informational capitalism“. This would rely on a constant supply of new data, which is why many companies need to pressure users into consenting to data processing and, ultimately, to manipulate them. The purpose of data collection is dubious in this context. Waldmann suggested that predictions about user behavior, which are personalized at great expense, hardly work any better in practice than much less invasive technologies.

The term “Dark Patterns” refers to a wide range of manipulative designs. The list ranges from simple tricks such as the placement and coloring of a button to sophisticated dialogs in which important information is cleverly placed so that most users do not notice it. Another popular method is to allow contracts to be concluded at the click of a button, but require a call to a hotline that is only staffed at times to cancel the contract.

Consumers not only act rationally

The current increase of such techniques is also the result of European legislation. It is based on the assumption of a rational consumer and places the burden of decision on them. “But people are very bad at weighing future risks against immediate benefits,” Waldman explained. Instead of reading privacy policies, consumers are being swayed to make a decision based on a website’s design or emotional appeal. These design tricks, known as “Dark Patterns”, manage to exploit users’ irrationality. Even well-informed citizens are not free from this. That is why a paradigm shift is necessary.

In addition to the immediate consequences of such manipulations, which result in unwanted subscriptions or purchases, the experts also pointed out other damages: These design tricks cause stress, waste time, and ultimately endanger the autonomy of citizens. Even previously harmless data is now being used to generate personalized consumer profiles, which are then used for further manipulation.

Harry Brignull, who first popularized the term “Dark Patterns” with his website on the subject, also pointed out, however, that techniques for influencing users cannot be seen as negative per se. By using a flashy color scheme, providers can ensure that users are particularly well informed – or tempt them to skip important information. They are only referred to as Dark Patterns if they trick consumers into make decisions that go against their own interests and are merely in the interest of the service provider.

Data protection laws finally enforced

The experts first identify an enforcement deficit. For example, the General Data Protection Regulation does contain a general provision that sets high requirements for how users can effectively consent to data processing. But so far, this provision usually results in general recommendations from responsible supervisory authorities, and seldom in fines.

Since dark patterns affect various policy areas ranging from consumer protection to data privacy to competition policy, one legislative amendment is not sufficient. According to the experts, provisions against Dark Patterns are needed in the Digital Services Act, the Digital Markets Act and the Data Act to avoid opening new loopholes. David Martin of the European consumer protection organization BEUC argued that the Unfair Commercial Practices Directive should be interpreted more strictly and applied to known manipulation techniques. He also said the 2011 Consumer Rights Directive should be revised to require a cancellation button, for example, so consumers can end contracts as easily as they can sign them. In Germany, such a button has already been adopted in 2021.

New transparency obligations?

In its version of the Digital Services Act, Parliament had banned misleading designs to the detriment of consumers, but was unable to draw a clear line where normal customer targeting leads to abusive design decisions. Parliamentarians want the European Commission to draw up a catalog of particularly widespread malpractices and specifically ban them. In the third trialogue on the DSA on Tuesday, there had been no significant progress on Dark Patterns.

Several experts at the hearing pointed out the need for strong supervision to support these requirements. For example, digital services coordinators should be given corresponding competencies and auditing duties. To support the enforcement of a ban, Fabiana Di Porto, a law professor at the University of Salento, called for the establishment of a complaints body and for new transparency obligations that would allow regulators to gain insight into the design process of digital offerings. These demands are also included in The Stiftung Neue Verantwortung’s policy brief, which takes a detailed look at the different negotiating positions of the Council and Parliament on the Digital Services Act. By Torsten Kleinz

China imports: faltering on the railways

When a freight train rolls out of the Chinese mega-city of Chongqing to haul containers to Germany, it has 10,800 kilometers of track and two weeks of travel ahead. The average speed is only 32 kilometers per hour. But that’s still significantly faster than the sea route and much cheaper than the plane.

In the COVID-19 pandemic, delays in container ships and reduced capacity on the air route have caused significant disruptions to supply chains. More than 90 percent of goods coming from China to Europe are transported via ship, and rail plays only a small role overall in the movement of goods between China and Europe. In terms of volume, it is only one percent. When considering the value of goods, it is still only three percent. Many goods transported by rail are high-priced.

The pandemic has brought a real boom in freight train transport. In 2021, goods worth almost €70 billion were transported to Europe this way – 50 percent more than in 2020, and ten times as much as in 2016.

The containers contain mainly machine parts and electronics, but also other goods such as metal products, chemical products and clothing. But the war in Ukraine is calling reliability into question. On the way from China to Germany, a large part of the busiest northern route runs right through Russia and from there via Belarus to Poland. So far, there have been no cancellations. DHL does report that train shipments bound for Russia or Belarus have been suspended until further notice. However, shipments for rail transport to Asia or from there to Europe are still being accepted.

There are first cancellations

Although the trains have been running reliably so far, companies have canceled rail shipments, reports a spokesman for Duisburger Hafen AG. It is the second most important port of terminal after Hamburg for the Germany-China freight train connection. A common fear among companies is said to be that international insurers could cancel insurance coverage provided by Belarus and Russia. Sanctions are also a concern, although rail transport is currently not significantly impeded by the sanctions against Russia. However, companies are becoming increasingly concerned in this regard.

The German Freight Forwarding and Logistics Association (DSLV) notes that more and more companies were looking for alternatives to the northern route. They were particularly interested in the southern route of the Silk Road to Turkey, which does not pass through Russian territory. However, this route to Germany takes much longer since it involves ship transits. The logistics association expects a steady decline in transport. However, the situation is still highly dynamic and can change at any time.

A myriad of problems

Rail transport has never been without problems: On the one hand, different track gauges slow down the speed. At border crossings, it can also come to a standstill, causing backlogs. At the China-Kazakhstan border, for example, there were delays of six days due to Covid measures. At the border with Mongolia, on the other hand, weak infrastructure is slowing things down, and at the border with Russia, a lack of carriages and resources on the part of the Russian railroads is preventing unimpeded travel. On top of that, there are political problems in the countries along the route. Most recently, unrest in Kazakhstan in January, was a factor of uncertainty for companies using this transport route. Company sources also report that corruption plays a role. High-priced goods are reported to have been lost on the way to China, which has contributed to a decision not to use rail.

Some companies continue to rely on transport by train even now, but are monitoring the situation very closely. The automotive supplier Conti has set up various crisis teams in order to be able to react quickly and in a targeted manner to possible effects on the supply chains with suitable measures. There are corresponding emergency plans that include safety stocks and alternative suppliers. The aim is to help secure the supply of raw materials.

Jacob Gunter, Senior Analyst of the Economics program at research firm Merics, sees uncertainty stemming from a rapidly changing geopolitical environment as a significant risk to rail transport. “It wouldn’t be a surprise if companies that wanted to ship their goods by rail before the invasion now switched to the slower but more reliable sea route. That would likely exacerbate supply chain problems, as demand for rail shipments has exploded during the pandemic. Rail has also become the fastest option for logistics because much of the air freight normally added to passenger flights between China and Europe came to a halt when China effectively closed its borders in early 2020.”

The rail is political

Rail is also politically relevant for China. The extensive “New Silk Road” rail network linking China and Europe is only a small part of the Silk Road initiative – but an important one, into which large subsidies flow year after year. Xi Jinping’s prestige project is certainly impressive: A freight train now runs from China to Europe every 30 minutes. So far, more than 50,000 trips have been made. There are 78 connections to 180 cities located in 23 European countries. In addition to transporting goods, the main purpose is to build relationships and economic influence in the partner countries. The problems now arising on and along this route are tarnishing not only the positive image of reliable rail, but also the future prospects of the partnerships in Eastern Europe.

“Beijing has warmed up relations with Kyiv somewhat in 2021, and the Presidents Zelenskyy and Xi have discussed the possibility of making Ukraine a ‘gateway to Europe’,” explains Merics expert Jacob Gunter. “China wanted to create an alternative rail entry point to the EU through Ukraine. Among other things, to reduce the risk of excessive dependence on Belarus, as well as Lithuania, which had sparked Beijing’s wrath by warming to Taiwan last year. With the Russian invasion, of course, these plans are on hold. Xi’s joint statement with Putin in February 2022, declaring a friendship “without borders” between the two, is likely to poison the well between Kyiv and Beijing. Should China rush to Russia’s aid, this would only get worse.” Julia Fiedler

Norway brings forward gas supplies

Norway is helping the whole European continent to quickly refill its gas storage facilities and is bringing forward gas deliveries to the summer months. Germany and Norway also agreed on Wednesday to cooperate on hydrogen imports, the Federal Ministry of Economics announced at the end of a trip to the country by department head Robert Habeck (Greens). In the process, the ministry also wants to clear the way for the controversial blue hydrogen, which is produced from fossil natural gas.

About one billion cubic meters (bcm) of natural gas can be delivered to Europe by the end of September due to the postponement of maintenance work and adjusted government permits for the Oseberg field, operator Equinor said Wednesday. Output at the Heidrun field could also be ramped up by 0.4 b cm by the end of the year. However, the applicable permits made it necessary to adjust the brought-forward deliveries from the Oseberg field downward accordingly in subsequent years, Equinor added.

The EU Commission has set itself the goal of filling natural gas storage facilities in the community of states to 90 percent by October 1 in order to become less dependent on Russian supplies for the next winter. However, the supply situation will remain tense for the next three winters, warned energy expert Felix Christan Matthes of the Öko-Institut at a Berlin Energy Days event.

Way clear for blue hydrogen and LNG

Habeck and Norway’s Prime Minister Jonas Gahr Støre signed an agreement on Wednesday to cooperate on energy issues. A feasibility study is to clarify how quickly large quantities of hydrogen can be transported from Norway to Germany. A hydrogen pipeline is also to be studied, he said. In addition, plans for the import of blue hydrogen are to be developed for a transitional period.

Before the outbreak of the war, the German Ministry of Economics had still declared that it did not want to actively promote the import of blue hydrogen. Blue hydrogen is controversial among climate protectionists because it is produced from fossil natural gas. The emissions produced are to be stored underground as far as possible using CCS technology. Norway wants to make greater use of gas fields under the North Sea for this purpose. However, capture is energy-intensive and climate-damaging methane can still escape through leaks in pipelines.

According to the agreement, there will also be further cooperation in renewable energies and offshore wind energy in particular. The government in Oslo also expressed its satisfaction with efforts by the EU to increase gas imports by tanker. According to Equinor, the natural gas liquefaction plant in Hammerfest is scheduled to come back on stream in mid-May. More than 6 bcm of LNG could then be shipped per year. The plant is located in the Barents Sea between Spitsbergen and northwestern Russia. After a fire, it had been out of operation since 2020. ber

Taxonomy and war in Ukraine: MEPs send letter to the Commission

In light of the war in Ukraine and the Commission’s plans to amend the Taxonomy Regulation, MEPs from almost all political groups have sent a letter to EU Commission President Ursula von der Leyen and Finance Commissioner Mairead McGuinness. In it, they demand that the delegated act on the taxonomy, which declares investments in gas and nuclear energy as sustainable, be withdrawn.

This would shift the focus of investment to truly sustainable energy sources and thus increase Europe’s energy independence, it says. The Commission’s Repower-EU plans, which aim to reduce the EU’s dependence on Russian gas, are at odds with the proposal to incentivize investment in fossil gas through the Taxonomy Regulation. If this were to continue, dependence on Russian gas would be further increased, undermining the effectiveness of the Repower EU plan, the parliamentarians wrote.

The letter was signed by a total of 102 members of the Greens, S&D, EPP, Renew, Left, and some non-attached parliamentarians. luk

Commission approves energy aid for Spain and Czech Republic

EU competition watchdogs on Wednesday approved energy subsidies for Spain (€2.9 billion) and the Czech Republic (€1.4 billion). With this, the EU Commission wants to compensate energy-intensive companies for higher electricity costs caused by rising CO2 prices in the EU Emissions Trading Scheme (ETS).

Both regulations allow indirect emission costs incurred in the previous year to be partially reimbursed to companies until 2031. The maximum amount of aid for a company is 75 percent of the indirect emission costs incurred. The exact amount of aid will be calculated on the basis of electricity consumption efficiency benchmarks, which are intended to ensure that aid recipients are nevertheless encouraged to save energy.

The support measures were aimed at preventing carbon leakage, as this would lead to lower economic activity in the EU and no reduction in greenhouse gas emissions, the Commission said in a statement. rtr/luk

Vestager wants agreement on DMA in March

The European Commission aims to clinch a fast-tracked deal with EU lawmakers and countries by the end of March on new rules to rein in the powers of Alphabet’s Google, Amazon, Apple, Facebook and Microsoft, Europe’s antitrust chief said on Wednesday. Margrethe Vestager, who had proposed the Digital Markets Act more than a year ago with a list of dos and don’ts for US tech giants, said there has been good progress in negotiations.

“We are now aiming to reach political agreement by the fourth trilogue by the end of March. If we manage that, that will be legislation with almost the speed of lightning,” she told a European Parliament hearing. Talks are due to resume on March 24.

Issues that need to be ironed out include the list of obligations for online gatekeepers – companies that control data and access to their platforms – and the level of turnover that defines which companies will be covered by the DMA, people close to the matter said. Another issue is whether the EU executive should be solely responsible for the proposed law’s enforcement at the expense of national watchdogs. rtr

AI Act: Germany wants an extra chapter for security agencies

Germany will refrain from using AI applications for remote biometric identification. This was confirmed by Christian Meyer-Seitz, Head of Department III in the Federal Ministry of Justice, at yesterday’s meeting of the Digital Committee in the Bundestag. It is true that use is permitted under the planned AI regulation for certain purposes, such as searching for missing children or combating terrorist attacks. However, the use would have to be authorized by national law.

However, according to the coalition agreement, this is not possible in Germany. This even stipulates that biometric recognition in public spaces and automated government scoring systems using AI are to be excluded under European law. But that will no longer be achieved, Meyer-Seitz conceded.

Avoid ex ante regulation as far as possible

According to Meyer-Seitz, the German government would prefer to regulate AI applications by security authorities in a separate chapter. Since the scope of the AI Regulation is enormous, the German government believes that certain gradations make sense and serve legal certainty. A proposal to this effect has already been submitted to the French Council Presidency.

The Commissioner for the Digital Economy and Startups, Anna Christmann, emphasized the importance of the AI Regulation for Europe as an AI location. She said the German government wants to further strengthen development processes while avoiding ex-ante regulation where it is not necessary. This is intended to prevent overregulation.

This Friday, the German government plans to send a comprehensive partial opinion to Brussels on the articles of the AI Regulation that have been discussed in the Council so far. ank

Russian developers want to launch Instagram clone on the market

Following the blockade of Instagram in Russia, Russian developers are working on their own photo and video platform. The goal is to launch the service, called Rossgram, on March 28, one of the developers responsible wrote on the social network VKontakte. It will offer additional options such as crowdfunding and payment services for some content. It is about a “Russian counterpart to a popular social network,” he said. Gazprom Media launched TikTok copy Yappy as recently as November. Meanwhile, state-owned conglomerate Rostec is developing smartphones to reduce dependencies on Western offerings.

Instagram has not been available in Russia since Monday, Facebook for even longer. Previously, Facebook owner Meta had adjusted hate speech rules to give people more opportunities to make their criticism public because of the Ukraine war. In the meantime, Russia has initiated criminal proceedings as a result. rtr

EU introduces additional duties on steel imports from Indonesia and India

The European Union has imposed additional duties on certain steel products from Indonesia and India. According to the EU Commission on Wednesday, the so-called countervailing duties on cold-rolled stainless steel flat products are intended to counter cross-subsidization by China. This is to ensure that these products can continue to be produced competitively in the EU. The background to the decision is a complex network of subsidies and trade restrictions.

With the help of Chinese subsidies, Indonesia is building up a processing industry, according to the Commission. In return, the country provides China with nickel ore at favorable prices, because Indonesia is one of the largest nickel ore producers in the world. The EU industry has been injured by imports of the subsidized stainless steel on the one hand, and completely shut off from the Indonesian market for nickel ore for its own stainless steel production on the other, the Commission said. Nickel ore is a raw material in steel production. dpa

Lithuania calls for postponement of EU-China summit

Lithuania is demanding that the European-Chinese summit planned for early April be suspended until the government in Beijing has shown which side it is on in the Ukraine conflict. “It is time to show China that we are serious,” said Deputy Foreign Minister Mantas Adomenas. He added that the government in Beijing should not expect that it can “support Russia on the one hand and take advantage of trade opportunities with the West – the European Union – on the other” and not fear any consequences.

The EU wanted to hold what is likely to be a virtual meeting with China to defuse growing tensions between the two sides. Lithuania’s Deputy Foreign Minister Mantas Adomenas said this was “not the right time for normalization.”

“In our assessment it is very ill-timed. In view of recent developments, it should be called off, or at least postponed significantly until we see which side China is on,” Adomenas said in an interview during a visit to Washington. But Adomenas said Lithuania, a former Soviet republic concerned about Moscow’s broader intentions, had “a lot of persuasion to do” to convince other EU members that the summit should not go ahead.

Partnership between China and Russia

The EU regards China as a strategic rival in some areas, but seeks to encourage Beijing to reform trade rules. US officials told China to expect consequences, including secondary sanctions, if Beijing provides material, military, or economic support to Russia in the Ukraine war.

China and Russia announced an upgraded “no limits” strategic partnership just weeks before the conflict began, and Beijing has refused to term Moscow’s actions an invasion, although Chinese leader Xi Jinping has called for “maximum restraint”. rtr

Russia expelled from Council of Europe

The Council of Europe has expelled Russia with immediate effect after 26 years of membership because of the war in Ukraine. This was decided by the Committee of Ministers in a special meeting, the Council of Europe announced in Strasbourg on Wednesday.

The previous day, Russia itself had already declared its withdrawal from the Council of Europe after it took steps to expel it. On Tuesday evening, the Parliamentary Assembly of the Council of Europe voted unanimously for Russia’s exclusion.

Russia had joined the Council of Europe on February 28, 1996. Together with the formal notification of the withdrawal, the Secretary-General of the Council of Europe received from the Russian Federation on Tuesday also the information about the intention to denounce the European Convention on Human Rights. dpa

What about the displaced climate?

By May Boeve, Mitzi Jonelle Tan, Nisha Agarwal

May Boeve ist Geschäftsführerin von 350.org. Nisha Agarwal ist stellvertretende Geschäftsführerin des International Refugee Assistance Project. Mitzi Jonelle Tan ist Initiatorin und internationale Sprecherin der Youth Advocates for Climate Action Philippines. — **May Boeve** (from left) is executive director of 350.org. **Nisha Agarwal** is deputy executive director of the International Refugee Assistance Project. **Mitzi Jonelle Tan** is initiator and international spokesperson for Youth Advocates for Climate Action Philippines.

The latest Assessment Report from the Intergovernmental Panel on Climate Change (IPCC) goes beyond the headlines about rising temperatures and sea levels to reveal the full extent of the threat to human life in a warming world. It explains how extreme weather, droughts, habitat and species loss, urban heat islands, and the destruction of food sources and livelihoods are all worsening. And scientists are now more certain that climate change has a direct impact on migration.

Climate-related displacement disproportionately affects people who have contributed least to the problem. Thanks to the repeated failure of major powers to address climate change, weather extremes in Central America, fires and storms in North America, floods in Europe and Asia, and drought in Africa are forcing people to migrate. Last year, the Red Cross confirmed that it is already facing the impacts of climate change in all 192 countries where it operates.

Migration as adaptation to climate change

The IPCC report recognizes that migration is a form of climate adaptation – and that it is already happening. This is an important correction to the widely held view that climate-induced displacement is a problem that will have to be dealt with at some point in the future.

This view is often accompanied in wealthy countries by fear-mongering about swarms of climate refugees. Across the global North, more and more public money is being poured into a growing border security and surveillance industry that promises to combat the “threat” with a “global climate wall.” The industry’s lobbyists and political allies claim that advanced networks of weapons, walls, drones and surveillance technology, and law enforcement are needed to protect powerful countries from future waves of climate refugees.

But climate walls offer no such protection. They not only threaten civil liberties – in wealthier countries as elsewhere – and divert resources from meaningful climate action into the hands of crisis profiteers. Worse, their actors are closely linked to the fossil fuel sector, global finance, and the arms industry, which profits from the conflicts that cause refugee flows and that climate change makes even more likely.

Loss and damage as issues for the climate movement

These false solutions are already costing lives and destroying livelihoods. In 2020/21, 2,000 people died in the Mediterranean due to the European Union’s illegal “pushback” policies. People turned away at the U.S.-Mexico border are also fleeing extreme weather conditions, as are many currently in indefinite detention in countries from the United Kingdom to Australia.

The IPCC report rightly emphasizes the urgency of decarbonization to prevent further displacement and displacement. But we must not stop there. The governments of the largest emitters of greenhouse gases must be pressured to support countries facing irreversible loss and damage from climate change. The global climate movement will fail if it focuses only on renewable energy and does not also address alleviating the suffering caused by the climate emergency that has already occurred.

Climate finance for resettlement

What else is there to be done? First, we need to protect both the right to leave and the right to stay. Climate finance to help vulnerable communities build resilience and limit migration is critical, as is improving disaster warning and response systems. But we also need funding to facilitate the safe relocation of people when necessary. Displacement tends to occur within a country rather than across borders, so we need to ensure that poorer countries have the resources to manage both short-term as well as long-term resettlement.

Second, in cases where climate-induced displacement reaches across borders, we should respond with flexibility and compassion, not paranoia and profiteering. Money spent on dystopian military and surveillance infrastructure should instead go to supporting safe and legal routes and procedures for people who need to relocate. The prevailing political impulse today is to try to keep people separated by the circumstances of their birth. However, with more resources and a different policy vision, we could ensure that both newcomers and host communities benefit from immigration.

Migration with dignity – from the worst climate impacts

Third, we need to broaden our understanding of what counts as climate-related displacement or displacement. Those fleeing storms, fires, and floods directly obviously need political support. But climate change is also a growing factor in resource scarcity, income loss, political instability, and violent conflict. We must resist efforts to narrow the definition of who counts as a climate refugee. We cannot wait until a disaster occurs before we act. We should consider processes now for planned migration with dignity that allow people in vulnerable areas to relocate before the worst impacts occur.

Despite its shortcomings, the IPCC report recognizes that human migration is an important part of the solution to the broader crisis of climate change. The lives of displaced, indigenous, and vulnerable communities in both the Global North and South have already been changed for the worse by pollution, fossil fuel extraction, and climate change. They have much to teach us about how we can protect lives in a heating world by bringing people together, promoting transboundary problem solving, and addressing the petty nationalism that has paralyzed the world’s response to the pandemic.

Answers to displacement already exist, as do the legal and ethical foundations for effective agreements among governments. What is needed is international action to create systems that can ensure a safe and dignified future for all. A climate movement that has learned to fully protect human life must be at the forefront of this effort.

Translated from English by Manuel Berkel. In cooperation with Project Syndicate, 2022.

The German government has been in office for one hundred days. At the time, it seemed as if every second sentence spoken by the traffic light coalition ministers spoke of new beginnings and progress. But instead of heading toward a green future, it now finds itself involuntarily in a situation that we thought we had left behind decades ago: War in Europe.

The past few weeks have rendered many a sentence in the coalition agreement obsolete. For example, one still reads about stronger cooperation with Russia and deep and diverse German-Russian relations. Of course, these words were written under different conditions and with good intentions. But it is remarkable how short-lived such a coalition agreement can be.

First and foremost: the expansion of gas-fired power plants. Originally, natural gas was said to be indispensable for the transition period. In the meantime, we know only too well what the use of natural gas entails. So coal instead? As we all know, coal should “ideally” be a thing of the past by 2030. Although the traffic light coalition is still sticking to this phase-out path, there are no real alternatives if gas is eliminated and nuclear energy is no longer to be an issue.

Wait a minute, there is: LNG! Liquefied natural gas is not yet mentioned at all in the coalition agreement. Meanwhile, the two LNG terminals being planned in Wilhelmshaven and Brunsbüttel are our greatest hope for energy independence from Russia.

However, the coalition partners were spot on when it came to the need to accelerate the expansion of renewables – despite all the skepticism from industry and business. Whereas just a few weeks ago it was said that the traffic light coalition’s plans (80 percent by 2030) were too ambitious and hardly feasible, hardly anyone now doubts that we have any other choice. Even Christian Lindner calls them “freedom energies.” How much can change in 100 days, after all. Lukas Scheid

EUROPE.TABLE EDITORS

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Charlotte
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Corinna
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Lukas
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Eric
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Sarah
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Manuel
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Lisa-Martina
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Dear reader,

Full gas storage facilities have gained strategic importance since Russia’s war of aggression. Norway is now specifically postponing the overhaul of a production facility in order to maintain the level of natural gas exports in the summer. Germany is forging ahead with the gas of the future and now wants to assess the construction of a potential hydrogen pipeline with Norway. For the time being, however, it will be filled with blue hydrogen: natural gas. This will be accompanied by the storage of CO2 using CCS. Read more about the Minister of Economics’ U-turn announced this evening in the News section.

Everyday goods, on the other hand, are transported via trains on their way from China through Russia or Belarus to the EU. The pandemic brought a veritable railway boom, but the war has since called their reliability into question. Julia Fiedler analyzes what role Ukraine should play for transport routes.

Meanwhile, the parliamentary report on the Corporate Sustainability Reporting Directive (CSRD) has been finalized. The aim is to make it easier for the public and investors to obtain information on how a company’s business activities affect the people and the planet. The Legal Affairs Committee has adopted the report. Lukas Scheid, who also wrote an Aperopa on the first 100 days of the German government, explains what the parliamentary groups agreed on.

Parliament wants to put a stop to dark patterns. Dark patterns are a myriad of unethical little tricks used in website design, leading Users to unknowingly conclude transactions or disclose information. Torsten Kleinz wrote about the solutions discussed at a hearing.

Today’s opinion piece is about climate migration. Plans should now already be considered for migration to resettle people from endangered areas before the worst impacts materialize, write activists from three climate and human rights organizations.

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Manuel Berkel

Sustainability Reporting (CSRD): bureaucratic monster or transparency guarantor?

By

Lukas Knigge

CSRD is about risk minimization and environmental as well as social responsibility. To date, reporting requirements on non-financial aspects of companies lack structure and comparability. This makes it difficult for investors, policymakers, and consumers to assess the environmental and social impacts of companies.

The CSRD (formerly Non-Financial Reporting Directive – NFRD) aims to require companies to provide more stringent and detailed information about the risks of their business practices to people and the environment from 2024. Public exposure should also encourage them to develop a responsible business approach, the Commission wrote in its justification for revision. In this way, investments are also to be steered more strongly into sustainable business areas – all in the spirit of the Green Deal.

After the Council agreed on a general approach on CSRD at the end of February, the parliamentary report was adopted in the lead JURI committee on Tuesday with 22 votes in favor and one against. Rapporteur Pascal Durand (Renew) described the result as a “balanced compromise supported by a large majority of political groups”.

CSRD standards not for SMEs

The MEPs agreed that disclosed information should be made more easily accessible, more comparable and independently verifiable, and thus more reliable. The European Financial Reporting Advisory Group (EFRAG) is to be tasked with developing binding EU standards for sustainability reporting.

In doing so, the Commission’s advisory body is to take into account environmental issues, social aspects such as equality and diversity, and governance, including anti-corruption and anti-bribery. The parliamentary report envisages that EFRAG’s budget will be increased accordingly. The standards for reporting requirements developed by the panel are then to be adopted by the Commission through delegated acts.

All companies with more than 500 employees that are active in EU markets would be affected by the CSRD. The Commission had proposed including small and medium-sized enterprises (SMEs), provided they are listed (Europe.Table reported). The parliamentary report does not foresee the inclusion of SMEs for the time being, but wants to have this reviewed at a later date and allow them to comply with the standards on a voluntary basis until then. In addition, companies are to be given an extra year to prepare for the new reporting requirements, so that the first report would be due in 2025 for the 2024 financial year.

Further review in high-risk sectors

Shadow rapporteur for the Greens, Marie Toussaint, regrets that SMEs are not to be covered by the CSRD: “Especially if they operate in high-risk sectors such as the extractive sector, agriculture, the textile industry or the financial sector.” At least, Toussaint says, a review clause has been introduced, with which Parliament calls on the Commission to establish additional criteria for reporting in such high-risk sectors.

For the conservative camp in the EU Parliament, on the other hand, the exclusion of SMEs is a success: It should not be forgotten “that sustainability information is not so easy to measure and record,” says Axel Voss, legal policy spokesman for the EPP Group. This would present companies with a huge challenge. Nevertheless, Voss fears “unleashing a new bureaucracy monster in Europe” if some points are not changed in the trilogue negotiations. For example, he is calling for sustainability reports not to be audited separately from conventional auditing and for subsidiaries to be granted an exemption from reporting requirements.

Numerous NGOs and public institutions – including Eurosif – had previously warned of a possible postponement of the reporting requirements. This is problematic for the Green Deal and the urgent need to reduce Europe’s dependence on fossil fuels from Russia, writes the Alliance for Corporate Sustainability. The fact that SMEs are not to be covered by the CSRD is also met with incomprehension. This would leave out 99.8 percent of the economy, criticizes Julia Linares Sabater, sustainable finance policy officer at WWF’s European Policy Office.

Hearing on Dark Patterns: is a paradigm shift necessary?

Only critics had the floor at the hearing. As committee chair Anna Cavazzini pointed out, the parliamentarians had also invited industry representatives, but none of the companies asked wanted to take part in the deliberations. The criticism of current industry practices became correspondingly fundamental.

Ari Waldman, a professor at Northeastern University, described the design tricks, that have become particularly widespread through cookie banners, as constitutive of “informational capitalism“. This would rely on a constant supply of new data, which is why many companies need to pressure users into consenting to data processing and, ultimately, to manipulate them. The purpose of data collection is dubious in this context. Waldmann suggested that predictions about user behavior, which are personalized at great expense, hardly work any better in practice than much less invasive technologies.

The term “Dark Patterns” refers to a wide range of manipulative designs. The list ranges from simple tricks such as the placement and coloring of a button to sophisticated dialogs in which important information is cleverly placed so that most users do not notice it. Another popular method is to allow contracts to be concluded at the click of a button, but require a call to a hotline that is only staffed at times to cancel the contract.

Consumers not only act rationally

The current increase of such techniques is also the result of European legislation. It is based on the assumption of a rational consumer and places the burden of decision on them. “But people are very bad at weighing future risks against immediate benefits,” Waldman explained. Instead of reading privacy policies, consumers are being swayed to make a decision based on a website’s design or emotional appeal. These design tricks, known as “Dark Patterns”, manage to exploit users’ irrationality. Even well-informed citizens are not free from this. That is why a paradigm shift is necessary.

In addition to the immediate consequences of such manipulations, which result in unwanted subscriptions or purchases, the experts also pointed out other damages: These design tricks cause stress, waste time, and ultimately endanger the autonomy of citizens. Even previously harmless data is now being used to generate personalized consumer profiles, which are then used for further manipulation.

Harry Brignull, who first popularized the term “Dark Patterns” with his website on the subject, also pointed out, however, that techniques for influencing users cannot be seen as negative per se. By using a flashy color scheme, providers can ensure that users are particularly well informed – or tempt them to skip important information. They are only referred to as Dark Patterns if they trick consumers into make decisions that go against their own interests and are merely in the interest of the service provider.

Data protection laws finally enforced

The experts first identify an enforcement deficit. For example, the General Data Protection Regulation does contain a general provision that sets high requirements for how users can effectively consent to data processing. But so far, this provision usually results in general recommendations from responsible supervisory authorities, and seldom in fines.

Since dark patterns affect various policy areas ranging from consumer protection to data privacy to competition policy, one legislative amendment is not sufficient. According to the experts, provisions against Dark Patterns are needed in the Digital Services Act, the Digital Markets Act and the Data Act to avoid opening new loopholes. David Martin of the European consumer protection organization BEUC argued that the Unfair Commercial Practices Directive should be interpreted more strictly and applied to known manipulation techniques. He also said the 2011 Consumer Rights Directive should be revised to require a cancellation button, for example, so consumers can end contracts as easily as they can sign them. In Germany, such a button has already been adopted in 2021.

New transparency obligations?

In its version of the Digital Services Act, Parliament had banned misleading designs to the detriment of consumers, but was unable to draw a clear line where normal customer targeting leads to abusive design decisions. Parliamentarians want the European Commission to draw up a catalog of particularly widespread malpractices and specifically ban them. In the third trialogue on the DSA on Tuesday, there had been no significant progress on Dark Patterns.

Several experts at the hearing pointed out the need for strong supervision to support these requirements. For example, digital services coordinators should be given corresponding competencies and auditing duties. To support the enforcement of a ban, Fabiana Di Porto, a law professor at the University of Salento, called for the establishment of a complaints body and for new transparency obligations that would allow regulators to gain insight into the design process of digital offerings. These demands are also included in The Stiftung Neue Verantwortung’s policy brief, which takes a detailed look at the different negotiating positions of the Council and Parliament on the Digital Services Act. By Torsten Kleinz

China imports: faltering on the railways