The European Parliament’s Committee on Economic and Monetary Affairs (ECON Committee) may propose substantial reductions in the number of companies required to comply with the EU’s sustainability reporting and due diligence regulations, significantly exceeding the cuts suggested in the EU Commission’s Omnibus plan, according to a draft amendments report reviewed by ESG Today.

These draft proposals follow the release of the Commission’s Omnibus I package in late February, which aims to alleviate the sustainability reporting and regulatory burden on companies. The package includes major revisions to several key regulations, including the Corporate Sustainability Reporting Directive (CSRD), the Corporate Sustainability Due Diligence Directive (CSDDD), the Taxonomy Regulation, and the Carbon Border Adjustment Mechanism (CBAM).

Among the key changes proposed in the Omnibus package is a dramatic narrowing of the CSRD’s scope. The regulation would apply only to companies with more than 1,000 employees and net annual turnover exceeding €50 million, thereby excluding an estimated 80% of companies from its sustainability reporting requirements. This 1,000-employee threshold aligns with that of the CSDDD.

However, the ECON Committee’s draft amendments propose raising these thresholds significantly—to 3,000 employees and €450 million in annual revenue—further reducing the number of companies covered by both the CSRD and CSDDD. The draft report justifies these changes as aligned with the goals of “simplification and reducing the reporting burden for EU companies.”

Additionally, the draft proposes stringent limits on the sustainability information companies subject to the CSRD must report. While the Omnibus plan seeks to reduce the number of data points in the European Sustainability Reporting Standards (ESRS), the amendments suggest capping mandatory ESRS data points at 100, with an additional 50 voluntary data points.

The draft also removes the CSDDD’s requirement for companies to implement a climate transition plan, reasoning that this obligation already exists under the CSRD.

These proposals underscore the difficulties Parliament faces in reaching a consensus on the Commission’s Omnibus package. Early debates in March revealed divergent views, ranging from calls to abandon the CSRD and CSDDD altogether to demands for pushing back strongly against the proposed reductions.

Stay ahead in sustainability compliance with Global PCCS —where expert insights meet the latest regulations. Unlock a future where compliance fuels sustainability, helping your business thrive in a greener, well-regulated world. For more information, contact us at info@globalpccs.com