The European Commission has introduced its first “Omnibus” package, proposing significant reductions in corporate sustainability reporting requirements. The key measures include:

✅ 80% of Companies Removed from CSRD – The scope of the Corporate Sustainability Reporting Directive (CSRD) is being drastically reduced, now applying only to companies with 1,000+ employees and either €50M+ in revenue or a €25M+ balance sheet.
✅ Simplified Sustainability Reporting – Large companies and banks will have limited access to sustainability data from smaller businesses.
✅ Revisions to EU Regulations – The CSRD, Corporate Sustainability Due Diligence Directive (CSDDD), Taxonomy Regulation, and Carbon Border Adjustment Mechanism (CBAM) will undergo major simplifications.
✅ Cost Savings of €6.4 Billion – The Commission estimates companies will save €4.4B annually from reduced CSRD compliance alone.

Key Adjustments Across Regulations:

🔹 CSRD Adjustments

• CSRD’s second wave of reporting is delayed by two years.
• Voluntary reporting for SMEs using the recently released VSME framework.
• Fewer ESRS data points, no sector-specific standards, and no mandatory assurance.

🔹 CSDDD (Corporate Sustainability Due Diligence Directive) Changes

• Implementation delayed by one year (now July 2028 for large companies).
• Due diligence now applies only to direct business partners, unless adverse impacts further down the supply chain are identified.
• Monitoring frequency reduced from annually to every five years.
• Removal of the obligation to terminate business relationships as a last resort.

🔹 EU Taxonomy Overhaul

• Mandatory only for companies with €450M+ revenue; smaller firms can report voluntarily for sustainable finance access.
• Emphasis on transition finance, allowing partial Taxonomy-alignment reporting.
• 70% fewer data points in Taxonomy templates and exemptions for non-material economic activities.

🔹 CBAM Scope Reduction

• A new threshold removes 90% of importers, excluding approximately 182,000 businesses.
• Despite the reduction, 99% of emissions under CBAM will still be covered.
• Simplified emissions calculations and reporting requirements.

These proposals align with the EU’s Competitiveness Compass, which aims to reduce corporate reporting burdens by 25% and boost Europe’s productivity.

The Omnibus package is now under review by the EU Council and Parliament, with the Commission urging priority treatment.

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