€4.5 trillion investor coalition urges EU to hold the line on methane cuts

October 3, 2025, by Melisa Cavcic

The European Union (EU) is facing pressure to uphold its methane regulation amid the climate push from 42 institutional investors, with over €4.5 trillion in assets under management, which have warned that backtracking would undermine regulatory certainty and market stability, while also slowing progress on methane reduction and net zero goals.

Illustration; Source: Environmental Defense Fund Europe (EDFE)

According to the Institutional Investors Group on Climate Change (IIGCC), a letter, calling on the European Commission, European Parliament, and EU Member States to maintain and swiftly implement the EU Methane Emissions Regulation (EU MER) as adopted, has been signed by investors managing more than €4.5 trillion in assets, including Nordea Asset Management, Sampension, Miller/Howard Investments and Church of England Pensions Board.

Eric Christian Pederson, Head of Responsible Investments at Nordea Asset Management, highlighted: “Regulatory certainty is fundamental to long-term business planning, and methane reductions are essential for limiting near-term global warming.

“The EU methane rules as they stand aren’t just good climate policy — they’re needed to reduce risk for companies, portfolios, the securities market and society at large. Watering down regulation that companies have already based investment decisions on is counterproductive and risks undermining globally agreed methane reduction efforts.”

This call reflects the points Environmental Defense Fund Europe (EDFE) recently made regarding the regulation being workable, solutions already existing for complex supply chains, and many U.S. and European companies proving implementation to be achievable through frameworks such as OGMP 2.0.

Jacob Ehlerth Jørgensen, Head of ESG at Sampension, noted:“We recognize the need to ease regulatory complexity for companies and investors, but climate and sustainability goals must remain front and center. Cutting methane emissions from the fossil fuel sector is critical to global climate targets, and regulation must not be delayed or weakened.”

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EDFE is adamant that weakening the methane law is not in the EU’s interest, as it would not strengthen energy security and would put at risk Europe’s ability to regulate independently in line with science and its climate goals.

Helen Spence-Jackson, Executive Director of Environmental Defense Fund Europe, commented: “The EU fought hard to put the methane regulation in place as a global benchmark. What makes today’s call so significant is that it comes from institutional investors with €4.5 trillion behind them. That scale of support sends a clear message to policymakers that the direction of travel has to be implementation, not backsliding.

“Reopening the law under Omnibus or trade pressure would be a blow to the level playing field that ensures all companies compete by the same high standards. This law is workable, and companies on both sides of the Atlantic are already proving it through frameworks like OGMP 2.0. The real prize is cutting methane quickly, strengthening energy security and showing that Europe can deliver climate policy in practice.”

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The 42 signatories of the letter stress the importance of regulatory clarity for companies and markets as they plan for compliance and manage long-term risks, as strong monitoring, reporting, and verification requirements, as outlined in the EU MER, are perceived to provide accountability, help mitigate portfolio risks, and strengthen companies’ operational resilience and competitiveness.

Luan Jenifer, CEO & President of Miller/Howard Investments, underlined: “Strong methane mitigation and robust measurement, reporting and verification (MRV)—core to the EU Methane Regulation—benefit not just the climate, but also the oil and gas industry and its investors.

“Methane performance is now seen as a proxy for management quality, operational excellence, and long-term competitiveness. Regulatory clarity and transparency build trust and drive smarter investment.”

The letter goes on to point out that companies will also benefit from timely guidance from the European Commission to prepare for compliance, since implementation depends on sustained collaboration with industry and investors. In addition, the signatories emphasize that curbing oil and gas methane emissions remains one of the most effective and cost-efficient strategies to limit near-term global warming. 

With this at the forefront, the letter advises EU policymakers to avoid reopening the regulation, ensure consistent and timely implementation across Member States, and apply rigorous standards for third-country equivalency, ensuring predictability for businesses, safeguarding market integrity, and reinforcing the EU’s global leadership on methane. 

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Sara Taaffe, Responsible Investment Analyst at Church of England, underscored: “Managing the financial risks of climate change remains a core priority for the Pensions Board. Reducing methane emissions is essential to this—helping mitigate portfolio risks and advance decarbonisation.

“That’s why we urge EU regulators to uphold the ambition of the EU Methane Emissions Regulation (EU MER), which provides the clarity and accountability businesses and investors need to act effectively.”