"CSDDD: Companies cry ‘burden’ while paying out billions to shareholders," 25 February 2025

...On 26 February, the European Commission will present its first ‘Omnibus proposal’, which will likely weaken several EU laws on responsible business conduct and corporate accountability, including the Corporate Sustainability Due Diligence Directive (CSDDD). European Commission President Von der Leyen, heavily influenced by business lobby groups, insists these rules harm EU companies’ competitiveness and profitability...

Key insights:

• Companies that fall within the scope of the CSDDD are highly profitable: the average stock exchange-listed CSDDD company recorded a net profit of €695 million in 2023, of which on average €478 million was paid out to its shareholders through dividends and/or share buybacks. 
• In total, CSDDD companies paid out €2.9 trillion to their shareholders through dividends and share buybacks between 2014 and 2023. This represents two-thirds of their total net profits, which these companies could have also invested in research and innovation or responsible value chains.
• Meanwhile, the financial cost of complying with the CSDDD – as estimated by the European Commission – would represent only 0.13 per cent of the average shareholder payouts made in 2023.

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SOMO, therefore, calls upon the European Commission to:

• Protect the CSDDD, CSRD and EU Taxonomy
  Ensure full implementation of the CSDDD, CSRD and Taxonomy legislation and avoid backtracking on agreed-upon legal texts. 
• Limit shareholder payouts
  Introduce a ban on share buybacks to ensure companies invest their profits in innovation and responsible business conduct instead of rewarding shareholders.