The EU Commission has published first drafts of its Sustainability Omnibus Package – a set of proposals by the Commission aimed at simplifying the EU’s business environment in relation to sustainability regulation and reporting.
While the EU remains a global leader in sustainability regulation, the three key pillars of EU sustainability regulation – the Corporate Sustainability Reporting Directive (CSRD), Corporate Sustainability Due Diligence Directive (CS3D) and EU taxonomy for sustainable activities – are highly technical, and many organisations have struggled with implementation. As a result, regulatory simplification has been a widely supported EU priority.
The simplification package includes proposals that the first CSRD reports are delayed for some companies that are caught, and the thresholds for the applicability of the CSRD reporting obligations be raised to capture only companies with more than 1000 employees, among other more detailed measures.
In terms of next steps:
- proposals to postpone application of CSRD and CS3D to upcoming waves of in-scope entities are expected to be finalised within four to six months; and
- the remaining substantive amendments are expected to take longer to agree, and therefore may take 12 to 18 months to be finalised.
For further details, see our ESG team's summary here and fuller briefing here.
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