Delivering on the European Green Deal A Private Sector Perspective 2025

TABLE 3 Recommendations: innovation potential Challenge Recommendations Public sector Private sector Reduce reporting burden and improve predictability –Where possible, collaborate with existing global standard-setters and frameworks to ensure European businesses and supply chain partners align with global systems. –Deliver on the EU’s commitment to reducing the reporting burden by at least 25% and streamline reporting requirements as soon as possible. –Regularize stakeholder dialogue with the private sector and civil society to ensure regulations are fit for purpose. –Develop sector-based sustainability reporting requirements, ideally in collaboration with global standard-setters. –Ensure regulatory stability and predictability including through mandating periods during which regulations cannot be amended. Tax incentives for innovative projects –Design EU-wide guidance on suitable tax credits or exemptions for both business and households to ensure demand and investment returns during product commercialization and scale up. –Consider both production tax credits and investment credits. Stability and predictability of incentives –Set in place collaborative mechanisms between industry, academia and the public sector to identify technologies and projects of strategic importance to the green transition. –Strategically plan long-term incentives for these technologies and insulate them from political changes. –For investment in key technologies, assure investors with fiscal stability clauses and/or tax stabilization clauses over an agreed timeline. –Do not set targets without consulting industry on the feasibility of product scale-up and putting in place sufficient demand incentives. –Introduce periodic reviews of incentives and technologies for new investments without affecting ongoing or existing ones. Common innovation objectives –Engage in pan-European, sectoral and cross-sectoral dialogue to identify common innovation priorities. –Agree and commit to innovation priorities, including capital commitments and clear guidance on financing gaps needed to be filled by private actors. Business-driven innovation –Identify regulatory and administrative bottlenecks that inhibit innovation. –Design business-centric solutions for these bottlenecks based on industry knowledge. –Supply public institutions with innovation solutions through continuous dialogue. Allowing calculated risk –Intentionally infuse some capital in early stage, high-risk investments and accept the chance of failure. –Engage with the public sector to co-fund these investments. –Increase the use of pilot projects and/or sandbox trials to reduce the risk of large-scale costly industry failures by further diversifying risks to public funds. –Collect lessons learnt for a central platform from successful and failed investments. –Establish regular feedback loops for prioritized investments. Furthering academic collaboration –Engage in dialogue with the public sector to identify academic institutions that are working on the technologies relevant for various sectors. –Support with the assessment of technologies’ viability for commercial purpose. –Support the commercialization of technologies, leveraging the scale of own operations. Delivering on the European Green Deal: A Private Sector Perspective 17