Insights
Ursula von der Leyen’s re-election as President of the European Commission saw the unveiling of her priorities for the next five years, including the future of the Green Deal. We look at how these ‘Political Guidelines’ align with what investors need to mobilise private capital for Europe’s green transition.
Despite the shift to the right in the European Parliament and some related pushback on the EU’s ambitious climate agenda to date, von der Leyen focused her political guidelines on the pro-European centre. She signalled a desire for continued climate action, framed in the context of competitiveness being the EU’s first priority over the next five years.
“We must and will stay the course on the goals set out in the European Green Deal. The climate crisis is accelerating at pace. And there is an equally urgent need to decarbonise and industrialise our economy at the same time.”
Many have nicknamed this ‘the investment Commission,’ with von der Leyen warning that Europe must now adapt to an age of geostrategic rivalries and the weaponisation of policies, including on energy and the climate. The returning President secured a comfortable 401 out of 720 possible votes, including support from the Greens for the first time.
The President’s full political guidelines for the next European Commission outline broad strategic priorities, including pledges to launch or complete different policy initiatives relating to climate. It’s worth noting that over 90% of von der Leyen’s last set of guidelines were eventually put into legislative proposals.
Our analysis considers how this prospective agenda lines up to the five key pillars from IIGCC’s EU Call to Action. 
A. Recommendation: Reinforce the EU’s path to 2050 climate neutrality
Investors will be reassured that the guidelines include a continued commitment to implementing the Green Deal, climate neutrality by 2050, and meeting the Fit for 55% emissions reduction target by 2030.
This pathway sets the scene for a proposal to amend the European Climate Law to include a legally binding 90% emissions reduction target for 2040. We have advocated for this ambition since 2023 and welcome its inclusion and alignment with recommendations from the European Scientific Advisory Board on Climate Change.
These clear climate priorities have been framed in the context of the first priority being to increase the bloc’s competitiveness, indicating a desire to remove red tape and simplify reporting requirements.
Though there is a case for streamlining processes, we continue to warn against the rollback of policies which undermine the political certainty that investors need. Coherence and interoperability will do more to reduce burdens in this space while also giving investors access to the high-quality data they need to assess transition efforts.
B. Drive climate action through industrial competitiveness
The clean industrial transition is at the centre of von der Leyen's plans. To channel investment into clean energy infrastructure and industry, and speed up planning and tendering processes in the sector, von der Leyen has pushed for the adoption of a new Clean Industrial Deal in the first 100 days.
Also on the agenda is an Industrial Decarbonisation Accelerator Act to support companies and industries in their transition. This aims to ensure a well-functioning energy market which reduces bills at the company and consumer level. Greater funding for a just transition is also set to be enshrined in the next long-term budget, alongside appropriate governance for a true Energy Union.
Eyes will be on the Commission to follow through. Details around the operationalisation of policies and the kinds of incentives used to attract private investment will be crucial in establishing an enabling environment for investors. Our recommendations highlight the importance of interoperability; including investors in future iterations of the Commission's Clean Transition Dialogues; and creating sectoral roadmaps to improve the EU's understanding of requirements to decarbonise in each sector.
C. Increase Europe’s adaptation and resilience to growing climate impacts
Engagement with adaptation and resilience is also a very positive development in the guidelines. It places the EU ahead of the curve with commitments to increase Europe’s climate resilience and preparedness as part of a European Climate Adaptation plan, which will support member states in planning, preparing and ensuring regular science-based risk assessments.
"As Europe’s climate warms faster than the global average, we must step up work on climate resilience and preparedness."
D. Ensure a nature positive transition to net zero
An area which falls short is the lack of attention to the role and value of nature in achieving net zero. While the guidance does highlight links between agriculture, food security and nature, it fails to set up a detailed nature or biodiversity agenda and instead defers to international commitments like the Kunming Montreal Agreement.
Von der Leyen pins agriculture as a key theme in the guidelines, committing to a “Vision for Agriculture and Food” to be actioned in the first 100 days. But there are questions on what role sustainability will play in agricultural production and a notable absence here is the relationship between agricultural competitiveness and nature. This may be seen as a missed opportunity.
E. Enable financial flows towards the net zero transition
The President has clear priorities for investment into net zero and the need for private finance in the transition, recognising that "investment cannot be financed through the public purse alone". It’s encouraging to see this recognised through commitments to increase public-private financing mechanisms that can help to de-risk these investments through collaboration with the European Investment Bank.
Beyond this, however, there is sparse reference to sustainable finance architecture. Most of the key building blocks are in place, but there is a need to double down on effective implementation. This includes addressing usability and coherence issues across regulations and ensuring that the concept of transition is fully embedded.
While it has its shortcomings, the agenda set out by von der Leyen signals her continued ambition to keep the climate agenda central to the next five years of EU development, pinning climate as integral alongside work towards economy and security.
The path forward in Brussels
The next steps towards building an agenda will be the Draghi report on the future of European competitiveness – likely to be published in September – and the preparation of mission letters outlining objectives for the Commissioners nominated to take on specific portfolios.
There will then be a hearing process for the Candidate Commissioners in the European Parliament, with the next Commission likely to take office on 1 November. A detailed timeline is featured below.
Updated timeline of the 'Year of change'
July-September – Member states notify their candidates to be their next national European Commissioners
September – von der Leyen unveils her prospective College of Commissioners, setting out portfolios and mission letters ahead of the hearings process
30 September – 4 October: Likely period for EP Committee hearings for Commissioners-designate
7-17 October – Likely period for second round of EP Committee hearings and/or follow-up questions
21-24 October – Provisional timing for European Parliament vote on new Commission College
25-31 October – European Council decision appointing the new COM
1 November – Earliest possible start date for the next European Commission
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