In March 2025, the European Commission published its Omnibus proposal, introducing major simplifications to CSRD/ESRS, the EU Taxonomy, and CSDDD. Here's what's changing:


🔄 CSRD / ESRS Updates:

- Threshold raised: Now only companies with 1,000+ employees and €50M+ turnover or €25M+ assets are required to report — reducing the CSRD scope by ~80%.
- Implementation delay: Large unlisted companies and listed SMEs get a two-year delay, while former NFRD entities must still report on time.
- Reduced disclosure burden: Many non-material and low-relevance data points removed; quantitative data prioritized; and voluntary elements expanded.
- Sector-specific ESRS scrapped: No longer mandatory.
- Assurance simplified: Limited assurance retained, with improved guidance; reasonable assurance removed for now.
- Value-chain data: Companies may rely on voluntary VSME templates instead of mandatory upstream data collection.


🔄 EU Taxonomy Changes:
- Reporting limited to companies with 1,000+ employees & €450M+ turnover and taxonomy-relevant activities
- Simplified templates and clearer technical guidance introduced


🔄 CSDDD Update:
- Delayed to 2028
- Due diligence limited to direct suppliers


💡 Important: The measures outlined above are part of a draft proposal and may still change during the negotiation and adoption process by the EU member states.

The Corporate Sustainability Reporting Directive (CSRD) was introduced to significantly expand the scope, consistency, and reliability of sustainability reporting across the European Union. Its central aim is to help stakeholders — from investors to regulators to civil society — gain access to trustworthy, comparable ESG information.The CSRD replaces the Non-Financial Reporting Directive (NFRD) and introduces a far more detailed, standardized framework based on the European Sustainability Reporting Standards (ESRS). By enforcing transparency and accountability in environmental, social, and governance performance, it helps companies align their strategies with long-term sustainability and resilience goals — while combatting greenwashing and driving a more sustainable European economy.

CSRD affects a broad range of companies operating in the EU:


- Large EU-based companies that meet at least two of the following criteria: more than 1000 employees, and €50 million in turnover, or €25 million in assets
- All publicly listed companies in the EU (including listed SMEs)
- Non-EU companies with significant operations in the EU and €150 million+ in annual EU turnover

The reporting obligations vary depending on the size, listing status, and location of the entity. Companies must report at the consolidated group level using the ESRS framework, with phased implementation beginning in 2024 for the largest companies and continuing through 2029.Even companies not directly obligated under CSRD may be indirectly affected — e.g., through value chain data requests or expectations from investors and large corporate clients.

At the heart of the CSRD is the European Sustainability Reporting Standards (ESRS) — a standardized reporting framework developed by EFRAG. The methodology includes:


- Double Materiality Assessment (DMA): Companies must assess both how sustainability topics affect their business (financial materiality) and how their business impacts people and the environment (impact materiality).
- Cross-cutting and topical standards: ESRS covers environmental, social, and governance topics, including climate change, biodiversity, workers, business conduct, and more.
- Granular disclosures: Companies must report narrative and quantitative data across dozens of data points, structured into standard tables and contextual narratives.
- Audit-readiness: Companies must provide limited assurance on their reports — with discussions ongoing around the future introduction of reasonable assurance.
Reporting must be machine-readable (XHTML + ESEF tagging) and published alongside annual financial statements.

CSRD brings both challenges and strategic opportunities. Internally, it enables better ESG data flows, clearer risk identification, and integration of sustainability into governance and performance tracking. Externally, it helps build trust with stakeholders, improves access to capital, and aligns disclosures with international expectations.


As one of the most far-reaching ESG regulations globally, CSRD is pushing thousands of European companies toward a new level of sustainability maturity. It also sets the tone for future global convergence — laying a pathway for alignment with ISSB, GRI, and the EU Taxonomy.Companies that prepare early and treat sustainability reporting not just as compliance, but as a strategic management tool, will gain a significant advantage.

To comply with CSRD and ESRS, companies must:


- Conduct a Double Materiality Assessment (DMA)
- Disclose general and topic-specific ESG data under ESRS
- Report on governance, strategy, metrics, and targets for each material topic
- Provide quantitative KPIs and qualitative context
- Publish digital, tagged reports with annual filings
- Ensure limited assurance by an independent auditor
- Coordinate group-wide data collection, even across subsidiaries and geographies
- Maintain clear traceability and documentation for each data point