Spain raises the bar on corporate climate action: Navigating Royal Decree 214/2025

In June 2025, Spain took a significant step forward in its sustainability framework with the entry into force of the Carbon Footprint and Reduction Planning Decree (Royal Decree). Fulfilling a mandate from Spain’s Climate Change and Energy Transition Law (Law 7/2021), the new decree makes effective the obligation for specified companies and institutions to calculate their carbon footprint, establish and publish greenhouse gas (GHG) emission reduction plans, and maintain continuity with the existing Carbon Footprint, Offset and Absorption Projects Registry (Carbon Footprint Registry), in operation since 2014.

The Royal Decree thus establishes a more detailed regime for the calculation, disclosure and registration of GHG emissions – defined as those resulting directly or indirectly from an organisation’s business operations – as well as for the publication of emission reduction plans.

This blogpost examines the scope and key obligations introduced by the Royal Decree, sets out how the calculation of corporate carbon footprints must now be structured and considers the practical implications for affected companies.

Status quo: from general non-financial reporting to carbon-specific rules

Prior to the adoption of Royal Decree, Spanish companies, meeting certain thresholds, were already required to disclose (inter alia) environmental impacts, including GHG emissions, via the so-called Non-Financial Information Statement (EINF). This obligation was already introduced by the Law 11/2018, which transposed the EU Non-Financial Reporting Directive into Spanish law.

However, the lack of clear technical parameters led to inconsistent reporting: companies applied different calculation methods that ultimately undermined both the comparability and utility of the data for regulators, investors and stakeholders.

By introducing standardized definitions and a structured methodology for carbon accounting, Royal Decree addresses these shortcomings and moves corporate climate reporting from broad disclosure obligations to a system of measurable, verifiable and comparable commitments.

Companies subject to the obligation 

The Royal Decree ties the personal scope of this obligation to entities subject to the existing non-financial reporting obligations, under the Spanish Commercial Code and the Companies Act. In practice, this means only Spanish-incorporated companies are covered, provided they match both requirements: (a) to have on average more than 500 employees and (b) either (i) qualify as public-interest entities, or (ii) meet, for two consecutive years, at least two of the following thresholds: more than €20 million in assets, more than €40 million in net turnover, or more than 250 employees. These thresholds reflect the current Spanish framework, but do not take into account the changes under the EU’s Corporate Sustainability Reporting Directive (CSRD), which has not yet been transposed into Spanish law. The Bill on Corporate Sustainability Information (Bill), currently before the Spanish Parliament, is intended to implement the CSRD.

Scope of obligation: calculation, reduction and publication

In-scope companies under Royal Decree now face three core environmental obligations. They have to: 

1. Annually calculate their corporate carbon footprint, using the internationally recognised classification of GHG emissions:
   • Scope 1 (direct emissions): emissions from sources owned or controlled by the company (e.g. combustion of fuels in boilers, furnaces or vehicles).
   • Scope 2 (indirect energy-related emissions): emissions associated with the generation of electricity, heat, steam or other forms of energy purchased and consumed by the company. 
   • Scope 3 (other indirect emissions): all other indirect emissions occurring along the company’s value chain (e.g. third-party logistics, employee business travel or waste management).
   • The calculation of Scope 1 and Scope 2 emissions is mandatory, although it is allowed to exclude non-significant sources, provided these represent no more than five per cent of the combined total of Scope 1 and Scope 2 emissions. Scope 3 reporting remains voluntary, although it is expected to gain importance with the transposition of the CSRD. 
2. Adopt and publish a five-year GHG reduction plan that stipulates (at least) one quantified GHG reduction target, the measures to achieve it, and the specific indicators the company will use to monitor its progress. The plan must align with Spain’s overarching objective of achieving climate neutrality by 2050.
3. Publicly disclose and make the carbon footprint and the GHG reduction plan publicly accessible, free of charge and in an easily available format, typically on the company’s website. Companies already subject to EINF reporting obligations are deemed to fulfil the publication requirements by including the carbon footprint and GHG reduction plan in the annual non-financial report.

Registration and the enhanced role of the Carbon Footprint Registry

The Royal Decree significantly elevates the role of the existing Spanish Carbon Footprint Registry. While registration remains voluntary for private companies, it is expected to become an important tool to demonstrate alignment with national climate objectives and to increase transparency towards stakeholders. Registration also grants access to the official seal of the Ministry for the Ecological Transition and the Demographic Challenge, which formally recognises organisations that calculate, reduce and offset their emissions. 

Importantly, registration may also create a competitive advantage for companies partaking in public procurement. The Royal Decree expressly provides that contracting authorities may include carbon footprint considerations as environmental criteria in tender procedures. The key novelty is that the Carbon Footprint Registry can now serve as direct evidence for contracting authorities in public procurement procedures. Instead of submitting separate documentation, companies may present their official registration as proof they calculate and manage their emissions.

From “twin-track” to full alignment: the CSRD transition in Spain

The obligations set out in the Royal Decree follow the timeline already established by Law 11/2018. In practice, this means that in-scope companies must incorporate the new reporting topics in their non-financial reports, starting in 2026, covering FY 2025. 

However, the Royal Decree’s long-term role must be understood in parallel with the forthcoming transposition of the CSRD, which is currently underway through the Bill. This creates a temporary “twin-track” reporting landscape for Spanish companies. The Royal Decree is a first step and, while companies will likely seek to integrate its requirements into their broader CSRD reporting to avoid duplication, how the Royal Decree's rules will be formally reconciled with the final CSRD framework remains to be seen. In practice, companies must comply with the Royal Decree while at the same time preparing for the CSRD regime, once transposed into Spanish law. Ultimately, the Royal Decree should not be viewed as a mere stopgap measure before any EU-level simplification through the “Omnibus” package is finalized. Although the Bill, currently before Parliament, appears to commit to the CSRD’s original and more ambitious schedule by not incorporating the optional two-year EU delay (i.e. the EU’s “Stop-the-clock proposal”, see our previous blog post here), the final outcome will ultimately depend on the ongoing legislative process in Spain. 

Practical considerations/key take-aways

The key takeaway is that, after the adoption of the Royal Decree, carbon accounting and emission reduction planning are no longer “soft” disclosure requirements but core reporting obligations. Boards and management should ensure that governance structures and technical expertise are in place to perform accurate Scope 1 and Scope 2 calculations, and to design credible reduction plans aligned with the 2050 neutrality target, backed up with sufficient data being internally documented. 

Further, although Scope 3 remains voluntary, proactive companies may wish to begin mapping these emissions to prepare for future EU-level requirements.

Finally, voluntary registration in the Carbon Footprint Registry has become strategically relevant, not only because it provides official recognition through the seal of Spain’s Ministry for the Ecological Transition, but also because it now serves as admissible proof of compliance in public procurement procedures. In competitive sectors, this may become a significant differentiator between companies aiming at the same public projects.