Paris ESG Startup FINGREEN AI Closes After EU Changes Reporting Rules

“I sincerely hope the European Union will soon recognise that sustainability can be a powerful driver of competitiveness even if the current regulatory direction clearly works against that and undermines the one domain where Europe has established itself as a true global leader and pioneer,” says Louis Frank, CEO and co-founder of FINGREEN AI.

The shutdown follows the EU’s new Omnibus Simplification Package, which introduced major changes to sustainability reporting rules and ultimately rendered FINGREEN AI’s business model unviable.

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Originally, FINGREEN AI focused on helping mid-sized EU companies especially those with fewer than 1,000 employees comply with the Corporate Sustainability Reporting Directive (CSRD). Its platform enabled organisations to measure environmental impact, meet compliance standards, and prepare mandatory sustainability reports.

However, recent regulatory changes have raised the thresholds for which companies must comply, restricting the mandate to large firms with more than 1,000 employees and substantial revenue or asset levels.

As a result, the very companies FINGREEN AI set out to serve are no longer required to report, dramatically shrinking the startup’s addressable market.

“The core challenge is that this target segment, which represented most of our projected client base, has now fallen out of the scope of mandatory compliance, removing the market driver for our service,” says the company.

Recent discussions in the European Parliament indicate that only companies with more than 1,750 employees and a net turnover above €450 million will be required to comply with the updated sustainability reporting rules.

This change means roughly 94% of the companies originally expected to report under the CSRD will now be exempt.

“Europe is taking a massive step backwards and slowing momentum in the global transition to sustainable business practices, one of the rare subjects it was at the forefront of,” says the company.

About FINGREEN AI

Founded in 2022, FINGREEN AI provided an AI-powered ESG platform designed to help consultants and private companies streamline sustainability reporting. The solution simplified data-collection compliance workflows and impact measurement enabling organisations to manage ESG requirements more efficiently and to prepare high-quality reports aligned with evolving regulatory standards.