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The European Commission on the 26th of February, 2025 has adopted a new package of proposals to simplify EU rules and boost competitiveness.
The changes, which include a phased reporting delay and adjustments to reporting obligations, focus the sustainability reporting obligations on the companies which are more likely to have the biggest impacts on people and the environment. Moreover, it seeks to ensure that reporting requirements on large companies do not burden smaller companies in their value chains.
Key Changes proposed to the CSRD:
Reduction of Scope: Proposed changes target companies with over 1,000 employees and a turnover exceeding €50 million or €25M+ balance sheet total, up from the previous threshold of 250 employees. This adjustment exempts approximately 80% of companies that were initially within the directive's scope.
Postponement of Reporting: The European Commission's Omnibus Package proposes a two-year postponement of sustainability reporting requirements for companies with over 1,000 employees that were initially scheduled to report on their 2025 data in 2026. This means their first reporting will now be due in 2028, allowing these companies additional time to prepare for compliance.
Focus on Direct Suppliers: The proposed changes limit the due diligence obligations of companies to their direct suppliers, reducing the scope of monitoring and compliance requirements. This shift aims to make the reporting process more manageable for businesses by focusing on the most immediate and controllable aspects of their supply chains
Sector-specific standards to not be required: The amendments aim to simplify the reporting process by reducing the complexity and volume of required disclosures. This includes eliminating sector-specific standards, thereby alleviating the compliance burden on companies and allowing them to focus more on core business activities
Implications for Businesses:
The proposed amendments are subject to approval by the European Parliament and EU member states. As the EU continues to refine its approach to sustainability reporting, businesses must stay informed about how the CSRD framework is evolving to prepare for potential adjustments to their reporting obligations.
While this allows companies additional time with CSRD reporting, it does not mean businesses should slow down their sustainability efforts. The shift towards greater corporate accountability and transparency is still very much in motion. Companies should use this period to refine their sustainability strategies, enhance data collection processes, and align with other key frameworks such as the Energy Performance of Buildings Directive (EPBD), Environmental Product Declarations (EPDs) requirements, European Green Deal and EU Taxonomy that remain in effect.
Rather than seeing this as a delay or a reason to pause, businesses should leverage this time to strengthen their sustainability strategies.
CSRD reporting may be delayed, but sustainability expectations aren’t going anywhere. Now is the perfect time to refine your strategy.
If you’re interested in making sustainability a core part of your brand’s growth strategy, pop me an email, and we’ll workshop your approach: emmanuella@generateleads.ie
