On February 26, 2025, the European Commission published a proposal for the first Omnibus Package, which includes amendments to the CSRD (Directive (EU) 2022/2464), the CSDDD (Directive (EU) 2024/1760), and other regulations on sustainability reporting. This new set of proposals aims to simplify EU regulations, enhance competitiveness, and unlock additional investment capacity. The Omnibus Package represents a significant step towards fostering a more business-friendly environment, supporting European companies in their growth, innovation, and job creation efforts.
CSRD: Reporting Obligations for Companies
The target group of the CSRD (Corporate Social Reporting Directive) will be aligned with that of the CSDDD. Only companies with more than 1,000 employees and either an annual turnover exceeding 50 million euros or a balance sheet total of over 25 million euros will be required to publish sustainability reports in accordance with mandatory reporting standards (European Sustainability Standards/ESRS). For non-EU companies, the revenue threshold within the EU will be raised to 450 million euros. Additionally, they must have at least one large EU subsidiary that meets at least two of the following criteria: a balance sheet total of 25 million euros, a turnover of 50 million euros, or 250 employees. Alternatively, an EU branch generating at least 50 million euros in revenue may also meet the criteria. However, companies will still have the option to submit sustainability reports on a voluntary basis. Furthermore, a so-called "Stop-the-Clock" provision ensures that mandatory reporting will only take effect from 2028, even if companies were initially required to report as early as 2026 or 2027.
CSDDD: Changes to Due Diligence Obligations
The proposed amendments to the CSDDD (Corporate Social Due Diligence Directive) extend the implementation period, postponing the application of due diligence obligations for the largest companies to July 26, 2028. Moreover, these obligations will, in the future, only apply to direct suppliers, rather than the entire supply chain. Suppliers with fewer than 500 employees will be exempt from these requirements. Additionally, audits will no longer be conducted annually but only once every five years.
How Companies Can Prepare
The European Commission has published the “Questions and Answers” section on its website to simplify the understanding of Omnibus Packages I and II. Companies should familiarise themselves with these changes early on and adjust their reporting and compliance processes accordingly.
Would you like to know how your company can best prepare for the new CSRD and CSDDD requirements?
Feel free to contact us for a free initial consultation. We will support you in interpreting the Omnibus Package and ensuring that the new regulations are effectively implemented within your organisation.
