Why Is ExxonMobil’s CEO Taking Aim At EU Sustainability Law?

All legislation can be divisive. Not least when it calls for large-scale change in the way businesses and their operations are run. 

Take the EU’s Corporate Sustainability Due Diligence Directive (CSDDD) as an example. 

The law, originally proposed in early 2022 and officially adopted by the European Parliament in April 2024, requires companies to conduct due diligence on human rights and environmental impacts in their operations and supply chains. 

EU member states have until mid-2026 to transpose the legislation into national law, after which companies will begin to comply in a stage manner. 

Critics of the legislation, including industry bodies and corporate leaders, have pushed back on its scope, pointing to the weight of expectation, financial risks and the need for more time to prepare.

Brussels has proposed easing the measures as a result, but CEO of ExxonMobil Darren Woods says that’s not enough and that he wants the law scrapped. 

In a recent interview with Bloomberg, he called the CSDDD “the worst piece of legislation I’ve seen since I’ve been in this job,” adding “given the perspective I have around the world, that says quite a bit.”

Leaving Europe behind

ExxonMobil Europe, has been a part of the European business community for 135 years, investing more than €20bn in the past decade.

Despite its established presence on the continent, in an interview with Reuters, Darren says that the law could drive more businesses out of Europe, stating concern that it would impose mandatory net zero plans globally and lead to “bone-crushing” penalties.

Under the CSDDD, if companies do not solve human rights and environmental issues within their global value chains, they can face a baseline fine of 5% of global turnover.

Darren says: “We have slowly been pulling out of Europe. This is another piece of legislation that would accelerate the incentive, or warrant business to reduce their activity in Europe.”

The oil producer has already sold, shut down or exited nearly 19 operations down to, what he describes as, “red tape impeding business” - including selling the Fes-sur-Mer refinery in southern France to Canada’s North Atlantic, according to Bloomberg.

Seeking US political help

Darren has reportedly previously taken up the issue directly with US President Donald Trump. It is reported that, in August 2024, Darren urged Trump to use the legislation in trade talks with the EU, a move that increased tensions between Washington and Brussels.

Darren told the Financial Times on a conference call: “This is counter, frankly, to everything that the Trump administration has been trying to do on the regulation front.

“As the US administration eases US regulatory burdens on companies here in the US, it is being replaced by EU climate regulations.”

Shifting attitudes to Europe

ExxonMobil announced on 18 September that it is pausing its €100m (US$117m) of investment in European plastic recycling.

Jack Williams, Senior Vice President of ExxonMobil, told Reuters the company was taking the measures across operations because the draft EU rules “discriminate against using existing petrochemical sites versus standalone facilities”.

He said that two existing plants for chemical recycling in Rotterdam and Antwerp that process 80,000 tons of plastic waste per year have been put on hold.

The company says it strongly prefers standalone technologies where the process from plastic waste to final product is clearer - arguing that current rules unfairly disadvantage more complex, integrated facilities that also use fossil-based feedstocks.