French President Emmanuel Macron this week joined German leader Friedrich Merz in urging the European Union to ditch corporate sustainability legislation that has been hailed by environmental groups but disliked by firms.

European Commission spokeswoman Paula Pinho told a press conference on Tuesday that the Corporate Sustainability Due Diligence Directive (CSDDD) text was still "alive".

Yet, coming from the heads of the bloc's two largest economies, the demand for a rethink may spell the end for the rules that took years to negotiate and is yet to come into force.

The CSDDD requires large companies to fix the "adverse human rights and environmental impacts" of their supply chains worldwide.

This entails tracking the deforestation and pollution they, as well as their suppliers and subcontractors, cause, as well as other issues like forced labour -- and taking steps to curtail them.

The text was proposed by the commission in 2022 after a parliamentary push inspired by the 2013 collapse of the Rana Plaza garment factory building in Bangladesh, which left at least 1,134 people dead.

It was finally adopted in April last year at the very end of EU chief Ursula von der Leyen's first mandate.

The law was backed by a broad coalition including the left and the greens as well as centrists, including from Macron's own party, and some centre-right lawmakers.

The lengthy negotiations and lobbying that surrounded it even became the subject of a documentary coproduced by Factstory, a subsidiary of AFP, titled "The Compromise".

- 'Shocking' -

Yet, from the offset the rules have been attacked as too burdensome for businesses.

Such a view seems to be prevailing as the bloc throws its energy into making its companies more competitive in the face of fierce competition from China and the United States.

In February the commission, the EU's executive arm, proposed to postpone the CSDDD's implementation until 2028 in a bid to help companies better prepare.

This came amid a broader EU drive to slash red tape seen as hindering businesses, amid slow growth and international trade tensions.

But on Monday, Macron said that did not go far enough, telling a conference of corporate bosses that the CSDDD and other rules need "not just to be postponed" but scrapped altogether.

Earlier this month, Merz, Germany's new chancellor, had similarly cited the rules among a series that his government hopes it will "be able to repeal".

EU lawmakers who worked hard on the text are not impressed.

Macron is offering "immunity to multinationals," complained Manon Aubry of the Left, who says she toiled for 150 hours with her Dutch colleague Lara Wolters on the bill.

Speaking to AFP Wolters described the U-turn as "shocking" and "arrogant".

"Repealing EU rules on responsible business would signal companies have the right to pocket profits made through exploitation and environmental damage," she added on social media. "Europe is better than this."