On February 26, 2025, the European Commission published the long-anticipated Simplification Omnibus proposal. This legislative package forms part of a broader regulatory development to reduce the reporting obligations introduced by the Corporate Sustainability Reporting Directive (CSRD). It is designed to simplify compliance while supporting alignment with the EU Taxonomy, the European Sustainability Reporting Standards (ESRS), and the Corporate Sustainability Due Diligence Directive (CSDDD).
Goal and Scope of the Omnibus Proposal
The mission is to enhance Europe’s competitiveness through simplified and more sustainable compliance. By reducing administrative burden, the proposal aims to stimulate business growth and align EU legislation with global transparency trends in carbon and climate reporting. It reflects a significant adjustment based on feedback from industries, stakeholders, and the European Council, and includes multiple amendments aimed at clarifying obligations and reducing complexity for companies across the EU.
Key Changes in the Postponed CSRD Law
The directive remains current and active EU law. Core sustainability principles like materiality, governance, and assurance continue to apply. Businesses should use the extended timeline to prepare robust ESG systems, conduct assessments, and align with both financial and non-financial disclosure obligations. Transparency around environmental, social, and governance risks remains a core subject of the directive.
- Increased Reporting Thresholds: A company now falls under CSRD only if it meets at least two of the following threshold criteria: 1,000 employees, €25 million balance sheet, or €50 million turnover. This change will affect a large number of businesses, particularly SMEs and subsidiaries.
- New Implementation Timeline: Most companies will need to comply by 2028, offering a longer preparation period. However, the first reporting obligations for listed companies and large enterprises will begin earlier, depending on eligibility and fiscal year.
- Simplified Requirements: Sector-specific standards are removed; supply chain disclosures are streamlined, especially for importers, cross-border structures, and non-EU entities. Companies are still encouraged to provide information on climate-related risks and due diligence measures, though some of this remains voluntary for certain categories of entities. The scope of reporting is also clarified, with more focused expectations on what must be disclosed across environmental, social, and governance dimensions.
Strategic Impact for Companies
This proposal creates a critical window for strategic action. Organizations—whether SMEs, listed entities, or public institutions—should use the delay to invest in robust ESG systems, conduct Finance-related impact assessments, and integrate sustainability into their long-term planning, in order to gain a competitive advantage.
Companies that act early can position themselves ahead of their peers. Key actions include:
- Selecting appropriate ESG and Accounting tools
- Preparing for limited or full assurance
- Reviewing current disclosure practices and laws
- Engaging with upcoming rules under CSRD, CS3D, and CBAM
- Building internal awareness across industries and business units
A ‘not yet’ doesn’t mean ‘no longer now.’ Companies that act with foresight now will have a clear advantage later – in terms of transparency, strategy, and competition.
Andreas Schiffleitner, iPoint Product Manager for Sustainability Products
Verdantix, an independent research and advisory firm, also views the Omnibus delay positively. In their News article "The CSRD, the Omnibus and the Case for a Reset", they describe it as a significant opportunity for businesses to build the right foundation — noting that 20% of the 280 surveyed respondents said the changes would actually increase their investment in ESG and sustainability software.
Rather than seeing the Omnibus-induced delay as a setback, firms should treat it as a strategic window. A chance to reset, build the right foundations and align reporting efforts.
Source: Case for a Reset, https://www.verdantix.com/insights/blogs/the-csrd-the-omnibus-and-the-case-for-a-reset
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Conclusion: Why Businesses Should Act Now
CSRD is delayed, not canceled. The Simplification Omnibus proposal provides breathing room for businesses to build robust governance strategies, implement ESG tools, and prepare for related regulations such as CS3D, CBAM, and updates to the EU Taxonomy. Now is the time to assess impacts, evaluate data gaps, and ensure your company stays ahead of the compliance curve.
The next wave of ESG regulation is already here. Taking action today means your company will be prepared for the years to come.
