Takeaways
- The Omnibus proposal extends compliance deadlines and reduces reporting requirements under CSRD, CSDDD, and the EU Taxonomy.
- The number of companies required to report under CSRD and the EU Taxonomy will decrease by approximately 80%.
- Companies will need to report fewer data points, making sustainability reporting clearer and more comparable.
- Supply chain due diligence will be less stringent, with a reduced focus on indirect suppliers.
- The proposal lowers enforcement mechanisms and assurance requirements, easing compliance burdens for companies.
Summary
The European Commission’s Omnibus proposal aims to simplify corporate sustainability compliance and reduce regulatory complexity. Key changes include extended compliance deadlines, a reduced number of reporting companies, and fewer mandatory data points for sustainability disclosures. The CSRD’s scope will shrink by 80%, meaning fewer companies will be required to report. The EU Taxonomy’s reporting requirements will also be reduced, with data points cut by two-thirds.
CSDDD modifications focus on reducing due diligence burdens, particularly for indirect suppliers. Large suppliers will remain accountable, but smaller suppliers will be shielded from excessive compliance demands. CBAM, the EU’s carbon border tax, will exempt companies importing less than 50 metric tons per year, significantly reducing the number of affected businesses while maintaining coverage for 99% of emissions.
The proposal also shifts the emphasis toward voluntary reporting for companies left outside the revised regulatory scope. The European Commission plans to introduce a simplified voluntary reporting standard. Assurance and enforcement mechanisms will be weakened, eliminating plans to upgrade CSRD’s assurance requirement from limited to reasonable assurance. Companies will also face reduced litigation risks under CSDDD.
The proposal must still be approved by the European Parliament and Council before being transposed into national laws. If adopted, it will streamline sustainability compliance, reduce regulatory burdens, and encourage voluntary reporting as a strategic tool for business resilience.
