“The CSDDD is the greatest threat to America’s sovereignty since the fall of the Soviet Union,” the Heartland Institute, a pro-Trump U.S. think tank, tweeted on 31 March.

The Heartland Institute is one of the world’s leading climate science denial groups. It has helped to draft Donald Trump’s anti-climate policies, which have seen the president pledge to “drill baby drill” for more fossil fuels and once again pull the U.S. out of the flagship 2015 Paris Agreement.

Over recent months – along with a host of other Trump allies – the Heartland Institute has set its sights on a new target: the EU’s Corporate Sustainability Due Diligence Directive (CSDDD).

This vague acronym belies the potentially transformative impact of the new law. In its original form, the CSDDD sought to require large companies – and those in “high risk” sectors – trading in the EU to address human rights and environmental issues in their own operations and in their supply chains. High turnover companies would also have been forced to adopt a plan to align with the Paris Agreement, including setting emissions reduction targets.

The Heartland Institute and its anti-climate, anti-regulation peers are vocal opponents of the law – and launched an aggressive campaign to water it down, or even to see it scrapped entirely.

These groups, which are all part of the ‘Make America Great Again’ (MAGA) ecosystem, view the CSDDD as symbolic of the way in which “woke” governments are attempting to force citizens and global corporations to conform to a pro-diversity, pro-environment agenda.

Following Trump’s election in November, these MAGA groups wasted no time in formulating their plans to oppose this perceived agenda.

They focused in particular on diversity, equity and inclusion (DEI) initiatives, which attempt to create workplaces free from bias – and environmental, social and governance (ESG) schemes, which try to ensure that organisations are guided by responsible and sustainable practices, not just profit.

In December, barely a month after Trump’s victory, the Heritage Foundation – the group that wrote the key ‘Project 2025’ blueprint for the president’s second term – published a report entitled: “ESG, DEI, and What to Do About Them”.

In the report, the Heritage Foundation described ESG and DEI as “pernicious”, and called the CSDDD “a serious problem”.

Two months later, the State Financial Officers Foundation – an influential network of Republican finance officials – wrote an open letter calling on the new administration to “investigate” the CSDDD, claiming that the EU’s directives are based on “unscientific assumptions about the nature of climate change impacts” and “will force companies to incriminate themselves”.

This quickly filtered through to Trump’s Cabinet. On 12 February, Howard Lutnick, the president’s pick for commerce secretary, told a Senate committee that the CSDDD threatened to place “significant burdens” on U.S. companies, and that the Trump administration was exploring the use of “commercial tools” to mount a counter-attack against the EU’s environmental regulations.

Soon this rhetoric made its way to the White House. In March, as part of the worldwide tariffs implemented by the Trump administration, the president called the EU “one of the most hostile and abusive taxing and tariffing authorities in the world”.

But the EU hasn’t stood firm in the face of Trump’s war of words.

The EU has already announced that it will be scaling back the CSDDD and delaying its implementation. The number of companies within scope has been reduced by 80 percent. The firms in question will only be required to file due diligence reports every five years, and won’t be required to investigate the ESG operations of their indirect business partners. The implementation of the law has also been postponed until 2028.

But Trump’s MAGA hardliners are still not satisfied. In April, the Heartland Institute released an open letter signed by 31 other groups, calling for Congress and the Trump administration to “take immediate steps to counter the CSDDD’s implementation”, including “if necessary, imposing retaliatory trade policies that punish EU nations for eroding America’s sovereignty, freedoms, and prosperity.”

This backlash is now influencing European leaders. In late May, French President Emmanuel Macron and German Chancellor Friedrich Merz called for the CSDDD to be scrapped entirely. They claim it must be abandoned in order to defend the “competitiveness” of European corporations, with Macron stating that Europe must “synchronise with the U.S. and the rest of the world.”

This judgement signifies the appeasement of anti-climate pressure groups that are ideologically opposed to clean energy and climate science.

The Heartland Institute has denied that humans are driving climate change, which it has called a “delusion”, while the Heritage Foundation’s Project 2025 document urged Trump to “dismantle the administrative state”, reverse policies on climate action, slash restrictions on fossil fuel extraction, scrap state investment in renewable energy, and gut the Environmental Protection Agency.

If the EU waters down its climate policies in response to Trump’s pressure, it will have helped to send Project 2025 global.

The ‘Climate Cartel’

It’s unclear whether these MAGA groups – and the Trump administration – will ease up on the EU if the CSDDD is ditched entirely. They may simply use it as evidence that European lawmakers will buckle under enough pressure.

Indeed, MAGA’s opposition to the CSDDD is part of a multi-pronged campaign that seeks to dismantle global climate initiatives pioneered by both governments and corporations.

Much of the original groundwork for this campaign was undertaken by the U.S. House Judiciary Committee and its chair Jim Jordan, a leading Trump supporter.

Last year, Jordan’s committee produced reports – and demanded evidence from major corporations – on a supposed “climate cartel” of “left-wing activists and major financial institutions”.

The committee alleged that some of the world’s biggest asset managers – that have questionable climate commitments – are conspiring to force American companies to decarbonise against their wishes.

As part of its “investigation”, the committee demanded information from more than 130 U.S.-based companies, retirement and pension programmes, as well as 60 U.S.-based asset managers.

In November, 11 Republican-led states sued BlackRock, Vanguard, and State Street – three of the world’s biggest asset managers – over their ESG policies. In West Virginia and Oklahoma, nearly two dozen banks have been barred from public contracts for trying to divest from fossil fuels.

These actions, along with the anti-climate rhetoric of Donald Trump, have had a chilling effect. In February last year, BlackRock, State Street, and JP Morgan Asset Management withdrew from Climate Action 100+, an investor-led initiative that works to ensure the world’s largest greenhouse gas emitters take action on climate change.

Fast forward a year, and a growing list of major U.S. corporations are either cancelling or delaying their sustainability reports – designed to show how they are meeting their climate commitments.

And a new story from the investigative outlet CORRECTIV today reports that German insurance giants and investment firms are withdrawing from climate agreements, while companies are quietly shelving their sustainability policies, amid the anti-ESG backlash orchestrated by Trump and his acolytes.

As one sustainability expert at a financial firm told CORRECTIV: “We have to be careful not to harm the cause by sticking our necks out and becoming a target in the U.S.”

This article was produced with support from the European Media and Information Fund, managed by the Calouste Gulbenkian Foundation. The sole responsibility for any content supported by the European Media and Information Fund lies with the author(s) and it may not necessarily reflect the positions of the EMIF and the Fund Partners, the Calouste Gulbenkian Foundation and the European University Institute.