Omnibus package - what will it change?

On 26 February 2025, the European Commission announced the Omnibus package. This is an initiative by the European Commission to simplify and reduce sustainability (ESG) reporting obligations for companies in the European Union. It consists of two parts: Omnibus I and Omnibus II, which introduce significant changes to the Corporate Sustainability Reporting Directive (CSRD) and related regulations, i.e. CSDD, CBAM and the EU Taxonomy.

Omnibus I - key changes

1. Deferral of reporting obligations (“Stop the Clock”). Companies that were due to start reporting under the CSRD in 2026 (large companies) and 2027 (listed SMEs) will be given two years of additional time to implement the requirements. 2. Raising CSRD reporting thresholds. The ESG reporting obligation will only apply to the largest companies - those with at least 1,000 employees and revenues of more than €50 million or balance sheet totals of more than €25 million. It is estimated that this will reduce the number of companies subject to CSRD reporting obligations by around 80%. 3. Simplification of the European Sustainability Reporting Standards (ESRS). The Commission plans to reduce the number of data required, prioritise quantitative indicators over narrative ones and make a clear distinction between mandatory and optional data. 4. Limitation of information reported in the value chain. Companies covered by the CSRD will not be able to request ESG information from entities in the value chain beyond that specified by the European Commission in the voluntary Sustainability Reporting Standard. 5. Reducing the cost of attestation of ESG reporting. Attestation by auditors will only be required at the level of limited assurance rather than reasonable assurance.

Omnibus II - further simplification

Omnibus II expands on the simplifications introduced by Omnibus I, covering additional regulatory aspects. The key changes are: 1. Abandonment of the development of ESRS sectoral standards. The European Commission proposes to abandon the idea of developing sectoral standards, with the aim of further simplifying reporting requirements. 2. Voluntary reporting of the EU taxonomy for smaller companies. Companies with fewer than 1,000 employees will not be required to use the EU taxonomy. In addition, companies that meet the employment criterion but have a turnover of less than €450 million will be able to take advantage of the voluntary taxonomy. 3. Changes to due diligence (CSDDD). The European Commission is proposing simplifications to due diligence, including limiting the requirement for an in-depth risk assessment to direct suppliers and reducing the frequency of business partner assessments to once every five years.

Summary

The Omnibus package, through Omnibus I and Omnibus II, introduces significant simplifications to ESG reporting, focusing obligations on the largest companies and reducing the burden on SMEs. These changes aim to increase regulatory efficiency and make it easier for companies to comply with sustainability requirements.