As the initial reporting period for CBAM passes, a shift in the market dynamic becomes evident. A recent article from Dagens Industri highlights Sweden's CBAM reporting figures, revealing low participation among businesses. With an estimated 5400 out of 6000 businesses failing to file their CBAM reports. Reason that have been mentioned include;  

  • National responsibility for the regulations was assigned late
  • Many companies remain unaware of CBAM
  • Technical challenges with the reporting platform
  • Complex reporting format. Initially simplified through the access and use of default values, but that to according to existing plan soon is intended to be replaced by the need to provide primary data acquired directly from source, which in turn will require more robust processes and better integration with suppliers.

Some companies has even found it easier to seek alternative sourcing strategies because the effort associated simply becomes too excessive.

In this article, we'll explore why being prepared early for upcoming regulations is not just a good idea—it's a necessity. If you act as a sustainability leader, you can help your business shift towards a more sustainable business model and use it as a risk mitigation as well as a business driver.

Understanding the Landscape

Before delving into the importance of early preparation, let's set the stage. The EU has set ambitious climate goals, aiming to achieve carbon neutrality by 2050. To achieve this the European Commission introduced the legislation package known as “Fit for 55”. This package includes a wide range of initiatives aimed at various sectors. CBAM is one of these initiatives. This mechanism aims to tackle carbon leakage by imposing tariffs on imports from countries with less stringent emission standards.  

The Challenge

Implementing CBAM on a large scale requires time, as evidenced by the numbers revealed after the first reporting period in a recent Financial Times article. In some countries, less than 10% of the expected reports were filed by the end of February, highlighting the complexity and lack of awareness surrounding the new regulation. Concerns about the administrative burden and potential loss of competitiveness further compound the apprehension among industry players. The European Commission's efforts to streamline the reporting process based on early feedback from companies aim to improve compliance and accuracy in the future.

The Cost of CBAM

In a previous article we discussed the potential costs of CBAM and how it might affect the trade as well as the impact on the market. The source stated in our article presents estimated figures on the potential cost increase.

For instance, the cost of Chinese aluminum could increase by 17%, while Indian aluminum could see a hike of more than 40%. Steel costs are estimated to rise by around 8% for the largest suppliers. This could lead to increased costs for the consumer.


In conclusion, the imperative of early preparation for forthcoming EU regulations is underscored by the sobering reality revealed in the recent Financial Times article: a mere fraction of the expected reports was filed by the end of February. This highlights the pressing need for businesses to proactively engage with CBAM requirements.  

While the cost implications of CBAM could potentially be significant, proactive adaptation is essential for businesses to thrive in the face of regulatory changes. By embracing innovation and sustainability, companies can navigate the challenges posed by regulations like CBAM and emerge stronger, more resilient, and better positioned for the future.

By acting today, companies can navigate the regulatory landscape, mitigate risks, and seize growth opportunities. The sustainability leaders we've seen are those who view these types of legal requirements as opportunities to motivate and drive the transformation, initiating a clearer shift towards sustainable practices as a risk mitigation as well as a business driver.  

Remember, although time may seem ample, regulatory compliance demands prompt attention. So, let's begin preparations now to relax when the regulations come into effect.

Lisa Hodnebrug

Marketing Manager
Lisa has extensive experience within digital marketing especially B2B, most recently in the IT sector.