US vs. EU on ESG: A Brewing Trade War?

The US is escalating its opposition to European ESG directives, with Trump’s Commerce Secretary pick, Howard Lutnick, openly threatening trade measures against the Corporate Sustainability Due Diligence Directive (CSDDD). His argument: the rules place an unfair burden on American companies.

The CSDDD and its counterpart, the CSRD, enforce strict supply chain accountability, requiring businesses selling in the EU to meet environmental and social standards—or face penalties. While the Biden administration was also skeptical, Trump's team is taking it further, considering aggressive countermeasures.

Meanwhile, opposition is growing within Europe itself. Industry leaders and governments in Germany and France argue the rules are too costly and complex. The EU’s Omnibus Package, set for release on February 26, could bring revisions—but will they be enough to prevent a regulatory rollback?

Will Europe stand firm on ESG, or will US pressure and internal dissent force a retreat? Read the full analysis here.