EU Adopts Omnibus Proposal, Reduces Sustainability Reporting Requirements

The European Union (EU), a political and economic union of 27 European countries, has revised its Corporate Sustainability Reporting Directive (CSRD), raising company thresholds and delaying compliance timelines. The new proposal limits CSRD applicability to firms with over 1,000 employees meeting financial criteria, reducing the original scope. Reporting deadlines have been pushed back by two years, with the first wave now starting in 2028.

The proposal also simplifies European Sustainability Reporting Standards (ESRS), cutting data requirements and removing sector-specific mandates. Additionally, the Corporate Sustainability Due Diligence Directive (CSDDD) will no longer require extensive supply chain assessments or impose civil liability for environmental and social impacts. The changes await approval from the European Parliament and Council.