04 ott 2024
The European M&A landscape is increasingly influenced by sustainability, driven by the new CSDDD directive.
This regulation mandates large companies to ensure ESG compliance throughout their supply chains, impacting even smaller suppliers.
A report by RSM Corporate Finance highlights that ESG factors are becoming crucial for investment decisions, with 92% of stakeholders seeing Europe as a more attractive investment destination due to these norms.
However, managing compliance is challenging, often requiring specialized expertise.
Despite these challenges, M&A volumes in Europe are thriving, with significant activity expected in Germany, Spain, and Portugal.
The introduction of the Corporate Sustainability Due Diligence Directive (CSDDD) in Europe has made sustainability a pivotal factor in M&A activities.
This directive, effective since July, obliges companies with over a thousand employees to ensure ESG compliance across their supply chains.
While initially targeting large industries, it also affects smaller suppliers, necessitating adherence to these new standards.
RSM Corporate Finance, in collaboration with Mergermarket, has produced a report examining the impact of these regulations on European M&A. Interviews with approximately 60 executives from various sectors reveal that ESG considerations are increasingly guiding investment decisions.
A significant 92% of respondents believe these regulations enhance Europe's appeal as an investment hub.
Ensuring supply chain compliance is seen as a competitive advantage by 87% of German and Italian investors and 80% of Spanish investors.
However, the challenge lies in managing and verifying compliance, as many companies lack the internal expertise.
While AI-powered software can assist in assessing supplier compliance, 91% of respondents acknowledge the need for specialist intervention in complex situations.
The report indicates that M&A volumes in Europe have surpassed pre-pandemic levels, with a favorable market outlook.
Investors anticipate closing multiple transactions in the coming year, particularly in the industrial, chemical, consumer goods, leisure, and energy sectors.
Geographically, Germany, Spain, and Portugal are expected to see the most significant growth in M&A activities, while Italy and Greece anticipate modest increases.