On the eve of its annual general meeting in Luxembourg, ArcelorMittal finds itself at the centre of a clash of narratives regarding its climate strategy. On the one hand, the NGO SteelWatch accuses the company of a “deliberate backtracking” on its commitments. On the other, the steelmaker claims it is taking a pragmatic approach to an energy transition that has proved more complex than anticipated.

In a report published on 4 May, SteelWatch claims that the group is “scaling back its climate strategy”, highlighting in particular the reduction of its carbon intensity reduction target for 2030 from 25% to a maximum of 10%, as well as the abandonment of its specific target for Europe. “ArcelorMittal is no longer content merely with failing to meet its climate strategy. It is in the process of scaling it back,” says Pascal Husting, a partner at SteelWatch.

This interpretation is strongly contested by the group, which highlights a more challenging industrial reality. In its 2025 sustainability report, published on 23 April, ArcelorMittal emphasises the growing complexity of the energy transition. “Our ambition to achieve carbon neutrality by 2050 remains in place, even though the reality of the energy transition has proved far less straightforward than initially anticipated,” says its chief executive, Aditya Mittal. The executive highlights a shift in the economic landscape, characterised by growing concerns over industrial competitiveness, energy security and inflation. “Concerns regarding competitiveness, reindustrialisation, inflation and energy security have taken centre stage in the debate,” he explains, thereby justifying the revision of the interim targets.

The technologies needed to decarbonise heavy industry are not yet competitive or ready for large-scale deployment.

Aditya Mittal, managing director, ArcelorMittal

In essence, the data presented by SteelWatch is largely based on the group’s own publications. ArcelorMittal thus confirms a 47.7% reduction in its absolute emissions since 2018 (including changes in scope), with a carbon intensity of 1.79 tonnes of CO₂ per tonne of steel in 2025. However, he also acknowledges that the pace of decarbonisation will depend heavily on economic and technological conditions.

“The technologies needed to decarbonise heavy industry are not yet competitive or ready for large-scale deployment,” Aditya Mittal points out, adding that “the conditions for the cost-effective decarbonisation of iron production are likely to remain challenging over the next decade”.

This approach translates into a more gradual investment strategy. The group is highlighting specific projects, such as the one in Dunkirk, where a blast furnace is to be replaced by an electric furnace as part of a €1.3 billion investment. This project is expected to reduce the site’s emissions by around 25%.

A 'holistic' approach under fire

Beyond direct decarbonisation, ArcelorMittal emphasises a broader approach to the energy transition. “We are taking a holistic approach to the transition, seeking to create value not only by decarbonising our operations, but also by developing solutions for other sectors and investing in renewable energy,” says its CEO. The group thus claims 2.8GW of renewable capacity (in which it holds a stake) currently in operation or under development.

SteelWatch, however, questions the overall coherence of this strategy, arguing that the group is prioritising incremental investments – particularly in electric furnaces – without making any fundamental changes to iron production, the main source of emissions. The NGO also criticises the low proportion of investment dedicated to decarbonisation within the group’s overall expenditure.

Against this backdrop, the debate goes beyond the specific case of ArcelorMittal and reflects the growing tensions surrounding the industrial transition in Europe. The group is calling for climate policies to be adapted, particularly the Emissions Trading Scheme (ETS), in order to safeguard the sector’s competitiveness.

“Policy is essential to accelerating decarbonisation without compromising competitiveness,” the group emphasises, stating that it supports a review of the European framework. In this context, the central issue is no longer so much the stated ambitions as the conditions for their implementation. As SteelWatch points out, ArcelorMittal will now be judged “not on its stated targets, but on its investment decisions and industrial choices”. A dividing line that illustrates the complex trade-offs between the climate transition and economic realities in heavy industry.