In this month’s ESG highlights, we bring you the most significant updates on ESG developments from across Europe and the Baltic region. From various regulation changes and climate-related initiatives at the EU level to bold new ESG initiatives in Estonia, Latvia and Lithuania, we spotlight the actions shaping a more sustainable future.
As always, our team is ready to support your ESG journey with insights, guidance and solutions tailored to your goals.
Legislative news and ESG initiatives in Estonia, Latvia and Lithuania
Lithuania
On 9 April, amendments to the Law on Equal Opportunities were officially registered. The proposed changes aim to strengthen the legal framework supporting the full participation in society of people with disabilities, and the effective exercise of their rights across various areas of life. In particular, the draft legislation encourages service providers to take more proactive measures to ensure accessibility. Among the key provisions is a proposal to explicitly recognise failure to provide properly adapted facilities as a form of discrimination on the grounds of disability. Additionally, the draft sets out specific areas in which accessibility must be guaranteed, including but not limited to education and the provision of services.
Amendments to the Law on Accountability of Companies and Group of Companies were also registered. These changes arise from the recently approved “Stop-the-Clock” Directive. The amendments propose delaying sustainability reporting obligations, with large companies and groups required to begin reporting from 1 January 2027, while listed small and medium-sized enterprises will start on 1 January 2028.
Latvia
The government aims to decrease the bureaucratic and administrative burden for the municipal building energy efficiency projects. On 22 April 2025, the Cabinet of Ministers approved amendments to regulations concerning the post-implementation supervision of energy-efficiency projects in municipal buildings. These changes introduce a self-declaration principle, reducing bureaucratic burdens and streamlining the annual monitoring of projects throughout their lifespan. As stated by the Minister of Regional Development, this initiative aims to increase trust in municipalities while ensuring the responsible use of funds as part of a broader effort to create a more efficient and citizen-friendly system of governance.
Estonia
A draft law has been introduced to amend the national law transposing CSRD (the Accounting Act) according to the Omnibus. At present, the draft would introduce postponement of deadlines for reporting – for large companies until 1 January 2027, and for SME until 1 January 2028.
A new coalition has been formed in Estonia between the Reform Party and Eesti 200. According to the coalition agreement, the government wishes to make a proposal at the EU level to make sustainability reporting voluntary.
EU-level news
EU officially greenlights “Stop-the-Clock” directive
The “Stop-the-Clock” Directive was officially published on 16 April 2025.
Member states must transpose the “Stop-the-Clock” provisions into national law by 31 December 2025. The “Stop-the-Clock” Directive is part of the first Omnibus package aiming to simplify the EU sustainability regulation and enhance business competitiveness. The new rules delay the implementation of certain Corporate Sustainability Reporting Directive (CSRD) and Corporate Sustainability Due Diligence Directive (CSDDD) obligations, granting companies more time to prepare for compliance. Large companies and listed SMEs will see their reporting deadlines pushed back by two years, while the deadline for transposing CSDDD is extended by one year. This move reflects the EU’s commitment to offering legal certainty to businesses, especially SMEs, while broader revisions to sustainability rules are being negotiated.
Commission rolls out plan to boost circular and efficient products in the EU
The European Commission has adopted the 2025–2030 working plan for the Ecodesign for Sustainable Products Regulation and the Energy Labelling Regulation. This plan prioritises products like steel, aluminum, textiles, furniture, tyres and mattresses for ecodesign and energy labelling requirements over the next five years. The goal is to promote sustainable, repairable, circular, and energy-efficient products across Europe. Additionally, the Commission will introduce measures to improve repairability and recyclability for consumer electronics and small household appliances.
Commission invests EUR 86 million to improve climate resilience and water security
The European Commission has announced an EUR 86 million investment in strategic integrated projects to enhance water quality, clean polluted rivers, improve fire and flood protection, and reduce greenhouse gas emissions. This funding will support projects in Denmark, Estonia, Poland, Slovenia and Iceland, aiming to help Europe achieve climate neutrality by 2050. The projects will mobilise additional investments from various EU and national funds, focusing on local climate action, water quality improvement, recycling, and climate risk management.
Landmark agreement to achieve net-zero emissions from global shipping by 2050
The European Commission welcomes the historic agreement at the International Maritime Organisation (IMO) to achieve net-zero greenhouse gas emissions (GHG) from global shipping by 2050. This landmark deal sets a global standard for reducing the GHG intensity of marine fuels and introduces a pricing mechanism for emissions, encouraging investment in cleaner fuels like renewable methanol and ammonia. The agreement, supported by the EU and its member states, aims to significantly reduce the environmental impact of the shipping industry and marks a crucial step in the fight against climate change. The new measures will be confirmed in October 2025 and implemented in 2027.
Updated rules for safer roads, less air pollution and digital vehicle documents
The European Commission has proposed a comprehensive update to the EU’s road safety and vehicle registration regulations. These new rules will address the increasing presence of electric vehicles and adapt to emerging technologies. Key changes include enhanced inspections, such as periodic technical checks for electric vehicles and advanced driver-assistance systems, annual inspections for older cars and vans, and advanced emission testing methods to identify high-emitting vehicles and reduce fine particle pollution.
Additionally, the Commission proposes digital vehicle registration and periodic testing certificates, simplifying cross-border data sharing, and protecting citizens against fraudulent activities. The new regulations will also make periodic technical inspections more accessible for those temporarily residing in another EU country. These updates aim to improve road safety, reduce environmental impact, and streamline vehicle registration processes across the EU.
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Contact the authors:
Co-head of Sorainen ESG team, Counsel, Lithuania
vitalija.impoleviciene@sorainen.com
Counsel, Latvia
Senior Associate, Estonia
