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In brief
- The direction for the EU's next funding period (2028–2034) is more performance-based funding, tighter monitoring and stronger horizontal principles, although the details are still being negotiated.
- The PM² sustainability addendum (SPM²) embeds sustainability into project governance, lifecycle, management activities and artefacts, rather than leaving it as a sole promise.
- It does not replace the funder's rules, but gives you a structure for executing the project and verifying the results..
EU projects are evolving in a direction where projects are increasingly expected to show what they actually deliver, and with what environmental, social and economic effects. Sustainability is moving from a well-phrased sentence to a tracked and verifiable part of the project. The PM² sustainability addendum (SPM²) offers a structure for sustainable project execution.
Where is EU funding heading?
In July 2025 the European Commission published its proposal for the 2028–2034 Multiannual Financial Framework (MFF). At the time of writing (September 2026) negotiations are still under way, so it is worth separating what has been proposed from what has been decided. The main features affecting projects:
- National and Regional Partnership Plans (NRPPs). Each Member State would prepare a single comprehensive plan replacing today's separate programmes, and funding would be released only once milestones and targets are met.
- Performance-based payments. Payments would be conditional on achieving predefined objectives rather than on reimbursing incurred costs, and audit authorities would audit the fulfilment of milestones and targets.
- Administrative effort shifts. Administrative work itself is reduced, and effort moves towards cost estimation, milestone-setting, verification and audit.
- Climate and environment. The Commission proposes that a minimum of 35% of expenditure should promote climate and environmental objectives (the current period has a 30% climate target), and that the "do no significant harm" (DNSH) principle be harmonised across the budget. It is preparing single DNSH guidance by 1 January 2027.
- Negotiations are open. The Council's partial position in June 2026 kept the DNSH principle, but the 35% target remains in square brackets, and views in European Parliament committees are divided. The MFF is expected to be agreed by the end of 2027.
Nobody yet knows what the final rules will look like. The direction is nevertheless clear: more verifiable results, more monitoring and more horizontal principles. This applies equally to ERDF-, ESF+- and JTF-funded projects.
What is the SPM²?
The SPM² extends the European Commission's PM² Methodology with practical guidance on integrating sustainability objectives into projects. It shows how environmental, social and economic considerations can be embedded into governance, phases, management activities and artefacts, and translated into concrete objectives, responsibilities and day-to-day practices. The SPM² guide includes following things:
| Foundations and Sustainability Context | Sustainable project management, overview of SPM², SPM² Manifesto and Mindsets. |
| Practical Application | The core of the addendum: integrating sustainability into the Initiating, Planning, Executing and Closing Phases, Phase Gates, Monitor & Control activities and governance responsibilities. |
| Appendices | Supporting material, including glossary, PM tools and techniques, application of SPM² in SMEs, agile, hybrid and private-sector environments, and KPI library. |
How does sustainability fit into the PM²?
The addendum's strength is that it does not add a separate sustainability process to the project. It connects sustainability to PM²'s components, which makes it a natural fit for projects already using PM².
| PM² component | What the SPM² adds? | Benefit for a funded project |
|---|---|---|
| Governance | Sustainability responsibilities for the AGB (Appropriate Governance Body), PSC (Project Steering Committee), Project Owner, Business Manager, Project Manager, Solution Provider, BIG (Business Implementation Group) and PCT (Project Core Team). Horisontal supporting roles include Chief Sustainability Officer (CSO), Sustainability Integration Advisor (SIA) and Risk and Compliance Officer (RCO). | Clear accountability: who is responsible for sustainability and who monitors it. |
| Lifecycle | Sustainability objectives in every phase; Phase Gates and Monitor & Control check that sustainability has been integrated and that related risks, issues and changes are managed. | Sustainability is checked before the project moves to the next phase. |
| Management Activities | Sustainability in Management Plans, Project Reports, Project Logs and Checklists; tracking of sustainability metrics, risks, issues and changes. | Sustainability is managed with the same tools as schedule, cost and quality. |
| Artefacts | Objectives, responsibilities, metrics, work packages and acceptance criteria documented in the Project Charter, Project Handbook, Project Work Plan and Management Plans; a dedicated Sustainability Log for recording actions. | Traceable documentation that supports reporting and audit. |
| Mindsets | Sustainability Mindsets presented as Infrequently Asked Questions (IAQs) that prompt the team to reflect on purpose, responsibilities, collaboration, continuous improvement and long-term sustainability of outputs and outcomes. | Sustainability affects how the team works instead of being just formal compliance. |
Benefits when preparing for tighter funding conditions
The table below maps the funding trends described above to structures in the SPM². The left column reflects the proposals described earlier; the right column is my interpretation of how the addendum can be used.
| Direction in the funding environment | How the SPM² helps? |
|---|---|
| Performance-based funding, milestones and targets | Sustainability objectives and metrics are recorded from the start in the Charter, Handbook and Work Plan, with acceptance criteria, so milestones are concrete and verifiable. |
| Tighter monitoring and reporting | Metric tracking is part of Monitor & Control and project reporting; a Sustainability Log collects sustainability-related risks, issues, decisions and changes. |
| Auditability and traceability | Decisions, deviations and changes are recorded in logs and reports, bringing eveidence for the audit and showing how objectives were set, monitored and how deviations were handled. |
| Horizontal principles (e.g. climate, environment, DNSH) | Phase Gates provide a fixed checkpoint where the project is assessed based on ESG (environmental, social, governance) viewpoints before proceeding. Sustainability risks and changes are managed with other risks. |
| Impact and durability of results | The SPM² considers sustainability implications when transferring results and implementing them. Management attention extends beyond project closure. |
| Clear accountability in the project organisation | Sustainability responsibilities are assigned to PM² governance, and horisontal roles (CSO, SIA and RCO) help monitoring ESG issues and delivery throughout the project. |
Getting started
The SPM² can be adopted gradually and is meant to be tailored to project size and needs. You can proceed e.g. as follows:
- Clarify the funder's requirements. Review the call, funding conditions and any requirements on sustainability, climate or DNSH.
- Translate requirements into objectives. Record sustainability objectives and metrics in the Project Charter and, where relevant, the Business Case.
- Assign responsibilities. Decide who is accountable for sustainability in the governance model and what horisontal roles (CSO, SIA and RCO) are required.
- Include metrics in the plans. Add work packages, acceptance criteria and monitoring approaches to the Project Handbook and Work Plan.
- Start a Sustainability Log. Record sustainability risks, issues, decisions and changes.
- Verify Phase Gate checklists. Assess sustainability at every Phase Gate and in project reports.
The SPM² Mindsets are a reminder that sustainability is a guiding principle, not an extra burden, and it needs to be considered from the very start of the project.
Read more about the PM² extensions
The SPM² is one of three official PM² extensions (PM² Agile, the Addendum for EU Funded Projects and the SPM²), see the overview article: PM² Extensions – Agile, EU-Funded Projects and Sustainability.
Sources on EU funding developments
- European Commission: proposal for a more flexible and performance-based Cohesion Policy 2028–2034
- Council of the EU: the EU's long-term budget 2028–2034
- European Commission: Performance Regulation (35% target, DNSH guidance)
- European Parliament Research Service (EPRS): NRPP proposal, monitoring and audit
- LDnet: Flexibility and Simplification in Cohesion Policy under the 2028–2034 MFF Proposals
- Agence Europe: MFF 2028–2034 – the 'green' ambition of the next EU budget
Want to get familiar with PM² and sustainability in EU projects?
Join the PM² community on LinkedIn Training calendar Explore the Addendum