EU “Omnibus” Package: Less effort for sustainability reporting?

With the draft of February 26, 2025 for the first Omnibus package, the EU Commission has presented proposals to amend the regulatory requirements for sustainability reporting. With regard to the Corporate Sustainability Reporting Directive (CSRD), the EU Taxonomy Regulation and the Corporate Sustainability Due Diligence Directive (CSDDD), a significantly reduced scope of application and a simplification of reporting obligations are planned in particular. The next step is for the draft to pass through the EU Parliament and the European Council. We have summarized the most important planned changes for you.
 

EU omnibus package at a glance

What changes are planned in the scope and initial application of the CSRD?

As part of the Omnibus package, the threshold is to be raised to more than 1,000 employees for large companies, irrespective of capital market orientation. Accordingly, only companies with more than 1,000 employees and either an annual turnover of more than EUR 50 million or a balance sheet total of more than EUR 25 million would be subject to a sustainability reporting obligation.

For companies that have yet to apply the CSRD for the first time (so-called 2nd wave), the date of initial application is to be postponed by two years. Accordingly, a reporting obligation for this group of companies would only apply to financial years starting from 2027.

According to the EU Commission's proposal, an estimated 80 % of companies would be excluded from the scope of the CSRD and would be brought closer to the scope of the CSDDD. Companies that are not (or no longer) subject to the scope of the CSRD should voluntarily apply a reporting standard to be issued by the EU Commission, based on the Voluntary SME Standard (VSME).

How will the European Sustainability Reporting Standards (ESRS) be revised?

The EU Commission's draft also provides for an amendment to the ESRS. As part of a proposed revision, the content is to be clarified. Furthermore, the number of data points is to be reduced by deletions, by prioritizing quantitative over qualitative data points and by further differentiating between mandatory and voluntary disclosures.

What is intended for the sector-specific standards?

The EU Commission's proposal envisages dispensing with the further development of sector-specific standards.

What changes are planned with regard to the reporting obligations for the EU Taxonomy Regulation?

The EU Commission’s proposal stipulates that the reporting obligation in accordance with the EU Taxonomy Regulation remains in place for companies covered by the CSRD’s new scope and also have an annual turnover of over EUR 450 million. Companies that are covered by the CSRD’s new scope but do not reach the additional annual turnover threshold are to be allowed to voluntarily apply reporting in accordance with the EU Taxonomy Regulation.

What format should reporting take in future?

The EU Commission's proposal would change the previous obligation to report in accordance with the ESEF format (European Single Electronic Format) into a disclosure obligation. Accordingly, the so-called electronic tagging would only have to be taken into account for the disclosure of sustainability reporting.

What is planned for the audit of sustainability reporting?

The obligation to audit sustainability reporting in order to obtain limited assurance for the audit opinion remains in effect. However, the Omnibus package no longer aims to transition from limited to reasonable assurance. The EU Commission's draft stipulates that corresponding guidelines on assurance will be published by 2026.

What changes are planned in connection with the Corporate Sustainability Due Diligence Directive (CSDDD)?

The EU Commission's proposal provides for a postponement of the initial application to July 26, 2028. In addition, the due diligence obligations for monitoring the supply chain would only apply to direct business partners and the company-specific monitoring obligation would be performed every five years instead of annually. The proposal also provides for the abolition of EU-wide civil liability. The proposed changes would significantly reduce the requirements of the CSDDD and the associated legal risk for companies. The extent to which the German Supply Chain Due Diligence Act will be harmonized remains to be seen.

What are the next steps?

The EU Commission's proposal has initiated a legislative process to amend sustainability reporting. Adjustments can be expected in the further legislative process. The further procedure envisages that the EU Parliament and the

European Council will discuss the draft Omnibus package, adapt it if necessary and decide on it. The German legislator has not yet transposed the CSRD into national law. In this respect, there is currently no change to the current legal situation, and the legal requirements for a non-financial (group) statement remain in force.

It is currently unclear when and to what extent the EU will amend the CSRD, which has already come into force. It is equally uncertain when the German legislator will implement any amended CSRD.

Companies affected by the regulations should monitor any changes in order to be able to flexibly take into account any adjustments to existing or planned measures.

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EU omnibus package at a glance