Delivering on the European Green Deal A Private Sector Perspective 2025

Executive summary The second edition of Delivering on the European Green Deal Objectives: A Private Sector Perspective is focused on assessing the progress of the European private sector towards climate neutrality. It analyses the European market context to support the green transition across innovation, financing, permitting and workforce transformation. The report is based on an analysis of environmental data on publicly listed European companies, two workshops held during 2024, a targeted survey and interviews with executives of the CEO Action Group for the European Green Deal, in addition to secondary research. The Scope 1 and Scope 2 emissions of the analysed companies decreased by 28% between 2019 and 2023, while Scope 3 emissions remained relatively stable. Target-setting is less prominent across energy, water and waste management, although European companies have managed to improve their overall resource efficiency. Energy efficiency is an area where significant improvements have been made. Setting supply-chain-related targets remains challenging for companies in the absence of internationally aligned sustainability standards for supply chain management. For companies surveyed and interviewed, Europe’s compliance and reporting demands are cited as the biggest obstacles to fulfilling sustainability commitments (more so than the costs of decarbonizing or low customer demand). Fragmented regulations and the absence of global standards are the main barriers to both European innovation and supply chain decarbonization. Most companies struggle with accessing public funding due to complex application processes and documentation requirements. To adapt to job market changes, companies offer employee training, talent retention schemes and graduate upskilling programmes, though few focus on reskilling experienced hires. Companies appeal for stronger EU market integration, particularly in capital and energy markets and standardization. The report also provides an overview of Europe’s preparedness for the green transition through an analysis of research and development (R&D) investments, innovation potential, permitting processes, funding landscape and workforce transformation. Besides the workforce, all areas would benefit from greater standardization, harmonization and transparency. The workforce transformation in particular will require close collaboration between the public and private sectors and a commitment from the private sector to ensure a just transition. For each of the analysed areas, the report provides detailed recommendations for both the public and private sectors. Public authorities should prioritize a lean and predictable regulatory framework to cultivate European innovation and strengthen efforts to develop globally accepted sustainability standards. Moreover, simplifying sustainability reporting, standardizing and digitalizing permitting processes, improving transparency and accessibility of funding mechanisms, and reallocating carbon revenues to climate action will be essential to reaching net zero by 2050. Continuous public- private dialogue is needed to succeed in the ambition of decarbonizing while strengthening competitiveness. Joint action is required on reskilling and job creation and transition for workers impacted by the green transition, and increasing European R&D investments.Advancing Europe’s green transition while driving competitiveness requires functional regulation and the full potential of the single market. Delivering on the European Green Deal: A Private Sector Perspective 4