EU's Omnibus Update
What Changed in Sustainability Rules
Discover how the European Parliament’s Omnibus I package is reshaping corporate sustainability reporting requirements for businesses across the EU.
What Changed in Sustainability Rules
Discover how the European Parliament’s Omnibus I package is reshaping corporate sustainability reporting requirements for businesses across the EU.
The European Parliament has recently voted on big changes to the EU's sustainability laws. These changes come through what's called the Omnibus I package, and they directly affect two major rules: the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD).
Let's break down what this means in plain language and how it impacts your organization.
Made companies report on their environmental, social, and governance (ESG) impact with comprehensive transparency.
Required companies to check their supply chains for human rights and environmental risks.
Together, these rules were meant to make businesses more responsible and transparent globally.
The Parliament decided to cut back on some of these requirements to reduce the burden on companies. Here are the key changes:
Only the largest firms (with very high turnover and thousands of employees) will now need to report under CSRD and CSDDD. This significantly reduces the compliance burden for mid-market companies.
Companies no longer have to prepare detailed plans showing how they will move toward net-zero emissions, reducing documentation requirements.
The rules are being streamlined so businesses spend less time and money on compliance while maintaining core accountability measures.
Lawmakers argued that the original rules were too heavy and costly, especially for smaller and mid-sized companies. The update is meant to boost competitiveness by focusing only on the biggest players while easing pressure on others.
This strategic shift reflects a balance between maintaining environmental and social accountability while supporting economic growth and business innovation across Europe.
"Balancing sustainability with economic competitiveness is key to long-term European prosperity."
Still need to comply, but with fewer obligations. This provides some relief while maintaining accountability standards for major market players.
Many are now excluded, meaning significantly less reporting work and compliance costs for SMEs and mid-market businesses.
Will get less detailed sustainability information, which could make comparisons harder but may streamline decision-making processes.
Still play a vital role, but the workload is lighter than before, allowing focus on strategic initiatives.
This update shows a shift in the EU's approach: balancing sustainability with economic competitiveness. The EU recognizes the need to support business growth while maintaining environmental and social standards.
While some worry it weakens climate and social accountability, others see it as a practical step to avoid overwhelming businesses and drive innovation in sustainability practices.
The Omnibus update signals that the EU will continue to refine its approach, focusing on targeted, effective regulations that drive real change without stifling economic growth.
The Omnibus update is basically the EU saying: "We still care about sustainability, but we'll focus on the biggest companies and make the rules simpler."
This means less paperwork, reduced compliance costs, and the ability to focus resources on core business operations while still maintaining sustainability commitments.
It raises important questions about whether lighter rules will slow down progress on climate action and human rights, requiring continued vigilance and commitment from all stakeholders.