On September 27, the word “sustainable” becomes illegal on a European product label unless the company selling it can prove the claim. So does “eco-friendly.” So does “climate neutral,” if the neutrality was purchased through carbon offsets. The Empowering Consumers for the Green Transition Directive bans all three, and it applies across all 27 member states.
Twelve weeks before that deadline, the European Commission finished cutting the rulebook that produces the evidence such proof depends on. On July 3, it adopted revised sustainability reporting standards that reduce mandatory disclosures by more than 60%. This represents two political currents running in opposite directions: what companies may say to shoppers is getting stricter, while what they must show the public is getting thinner.
For anyone trying to judge the products they buy, the useful skill now is knowing which document answers which question.
Illegal in September
The directive, known as “EmpCo,” amends the EU’s foundational consumer-protection law rather than creating a separate regime. It entered into force in March 2024; member states had to write it into national law by March 27, 2026, and it applies continent-wide starting on September 27, 2026. Products already on shelves do not have to be updated, but all new production must be compliant with the new rules.
Four categories of sustainability claims go away:
- Generic environmental terms including “eco-friendly,” “green,” “sustainable,” if the seller cannot demonstrate recognized, excellent environmental performance relevant to the claim.
- Offset-based neutrality claims, such as “carbon neutral” or “climate neutral,” if they were achieved by buying credits rather than cutting emissions. Genuinely lower carbon claims remain legal.
- A common problem, whole-product claims based on partial evidence, for instance touting one component’s footprint as though it described the entire item or company, is forbidden.
- Legal minimums dressed up as achievements, for example advertising compliance with existing law as a voluntary environmental commitment.
Self-created labels are prohibited as well. A sustainability label may be displayed only where an independent third party monitors the certification scheme behind it. The retailer, not the manufacturer showing the label, carries the legal responsibility, which will exert influence on companies that want to keep their products on store shelves. The new rules will be enforced through national consumer authorities, with cross-border cases coordinated through the EU’s Consumer Protection Cooperation network.
Unfortunately, the widely anticipated Green Claims Directive, the more sweeping verification law many people are still waiting for, is not coming any time soon. The Commission announced its intention to withdraw the proposal in June 2025, and final negotiations were canceled. It has never been formally withdrawn, and its legal status remains unresolved; it was shelved rather than killed.
The Rulebook Shrinks
Proving an environmental claim requires data, and the EU’s mechanism for producing that data is the Corporate Sustainability Reporting Directive (CSRD). The directive creates the legal duty to report. A companion set of technical standards, the European Sustainability Reporting Standards (ESRS), specifies exactly what must be disclosed. As of July 3, the standards were revised. A separate change had already narrowed who must follow them.
That separate change is the Omnibus I package, which the EU Council approved in February and which took effect on March 18, 2026. It raised the reporting threshold to companies with more than 1,000 employees and more than €450 million in annual net revenue (“net turnover” in the EU’s legal text). Legal analysts estimate that roughly 80% of the companies originally covered now fall outside the rules, and listed small and mid-sized firms are exempt entirely.
The revision also changed how a company decides which topics to cover. The original standards worked from the ground up: companies had to identify every individual impact, risk, and opportunity, assess each one, then aggregate to determine whether a subject like water or biodiversity warranted reporting. The revised standards permit a top-down judgment call: a company may now decid, at the level of an entire topic, whether the subject is immaterial and skip the reporting all the data related to it, without documenting each underlying impact. Conversely, companies are also barred from reporting information they consider immaterial, on the theory that padding claims obscures the information that counts.
What Survived and What Quietly Left
The architecture held. All twelve topical standards remain, along with the framework’s defining feature: double materiality, meaning companies report both how sustainability issues affect their finances and how their operations impact people and the planet. That second half is the one consumers and communities care about, and although it was the regulation most likely to be eliminated, it survived.
Reading “more than 70% fewer data points” as “70% less disclosure” gets it backward. The surviving requirements are the most relevant ones. According to one analysis, the number of details required fell from roughly 1,073 to about 320, but the climate standard, ESRS E1, expanded to 11 disclosure requirements, including the publication of a 1.5°C-aligned transition plan, a full Scope 1, 2, and 3 emissions inventory, scenario analysis, resilience, internal carbon pricing, as well as separate treatment of carbon removals and credits. A dedicated standard, ESRS S4, still covers consumers and end users.
The losses are specific, and two of them are hard losses. Frank Bold, a public-interest law nonprofit that has tracked EU corporate reporting for years and participates in the standard-setting process, said that the revised standards keep double materiality and fair presentation intact while weakening what companies must disclose about greenhouse gas emissions, microplastics, and human rights.
Microplastics-related disclosure is now limited to primary microplastics, those deliberately manufactured and added to products, such as microbeads or cosmetic glitter. Secondary microplastics, which form as larger plastic waste breaks apart, were eliminated from the rule. However, those tiny shards of plastic represent the larger share of the problem. Regarding human rights, companies must now disclose only substantiated incidents and proceedings that are still ongoing.
Fewer Reporters Than Before the Rules Existed
Before the CSRD, EU sustainability disclosure was governed by the Non-Financial Reporting Directive (NFRD), which covered about 11,700 companies. The CSRD was written to expand that to roughly 50,000 worldwide once fully phased in. Under the Omnibus thresholds, about 90% of those — roughly 42,000 companies — are no longer required to submit reporting.
About 8,000 companies remain; other analysts put the figure closer to 5,000. Either estimate is below the 11,700 that reported under the NFRD. Treat the exact number with care, since these estimates use different bases and some count worldwide while others count only EU companies. The public now receives disclosures from fewer companies than before the CSRD was introduced.
One thing did improve and has stayed improved. NFRD disclosures were unstandardized and unaudited, but today those reports must be assured, standardized, and digitally tagged.
Simpler for Whom?
Whether a leaner report serves consumers better will be an ongoing debate, and the split falls along predictable lines. Companies preparing the reports welcome the change. The people who use the data are warier. In a cost-benefit study commissioned by EFRAG, the EU’s own reporting-standards advisor, 55% of data users expected the amendments to lower information quality, and 67% of investors and financial institutions cited weaker comparability and a loss of climate and environmental detail.
Staff at the European Central Bank warned that the long list of permanent reliefs and phase-ins would significantly reduce transparency for investors and other market participants. Analysts elsewhere read the outcome as better than expected, noting that the Commission held the line on double materiality and declined to let companies bury their environmental impact behind a purely financial lens.
Consumer needs were called out as having lost out by 29 civil society organizations, including ShareAction, WWF European Policy Office, and the World Benchmarking Alliance. They argue that the standards are among the few tools that let citizens see what large companies actually do, and that cutting them opens the door to greenwashing. Without clear, comparable information, responsible companies become indistinguishable from those making unsubstantiated claims.
The American Workaround.
None of this is enforceable by a shopper in Ohio, but the information can still be useful. EU consumer law protects EU consumers, and an American buyer has no standing under any of it. The leverage is indirect, and it rests on two facts: the disclosures are public documents anyone can read, and multinational brands rarely maintain two separate sustainability stories for two markets.
So, when doing sustainability research, start with the parent company rather than the label. The name on the package is often a subsidiary of a group large enough to be required to report environmental impacts. Look up who owns the brand, then search that parent’s name alongside “sustainability statement” or “annual report.” The disclosures are typically found in the management report with the audited financial statgement, which is deliberate because it puts emissions data in the same document as the company’s auditors sign.
Read the materiality assessment before anything else. Under the new top-down approach, that section records which topics the company declared immaterial and therefore skipped. It functions as a map of what the company chose not to discuss, which is frequently the most revealing information about it intentions.
The impact will be most tangible after September 27. Compare a brand’s European storefront to its American one. A company that keeps “climate neutral” on its .com page after scrubbing it from its .de or .fr page is telling you the claim could not survive third-party scrutiny. Claims that are made only in the US market are those that failed a verification test elsewhere.
What You Can Do
The new data is company-level rather than a product eco-score, but it can still be put to work:
- Look up the parent company, not the brand. Search the corporate owner’s name plus “sustainability statement,” and open its most recent annual report. Skip the glossy summary PDF and find the statement inside the management report.
- Read the materiality assessment first. It lists the topics the company decided were immaterial and skipped. Where a company concluded that pollution or biodiversity doesn’t merit discussion, that decision is the story.
- Watch what vanishes from European packaging after September 27. Once EmpCo applies, generic and offset-based claims become illegal in the EU. Compare a brand’s European site to its American one; the gap between them is free information.
- Check climate promises against the SBTi Target Dashboard. It’s free, updated weekly, and covers companies regardless of EU scope, including US firms that will never file under the CSRD. It also flags organizations whose commitments were removed for missing the two-year deadline, which is a form of disclosure in itself.
- Put two dates on the calendar. ESAP, the EU’s free public portal, opens July 10, 2027, and will make company-to-company comparison far easier once sustainability data phases in during a later wave. After that, the Digital Product Passport will require a scannable record on the product that discloses materials, origin, repair guidance. A battery passport arrives first, with textiles expected to follow. Those dates are indicative and have moved before.