On February 24, 2026, the General Affairs Council officially approved the European Parliament’s position on the first Omnibus package on sustainability reporting and due diligence requirements for companies. It follows Parliament’s position from December 16, 2025. Below is a brief summary of the most important points.
The Directive
The Directive (EU) 2026/470 was published in the Official Journal on February 26, 2026 and dramatically scales back mandatory EU sustainability reporting and due diligence to the very largest companies (>1,000 employees + €450M turnover for CSRD; even higher for CSDDD), simplifies assurance significantly, removes future reasonable assurance mandates, introduces transitional reliefs, and prioritizes burden reduction to support EU competitiveness while keeping Green Deal essentials intact.
It enters into force around mid-March 2026, 20 days after publication. Member States must transpose most CSRD changes by March 2027, with CSDDD changes by July 2028.
Key Changes to CSRD
The kex changes to the CSRD Sustainability Reporting – Directive 2013/34/EU & 2022/2464) are:
§ Narrowed scope:
Major reduction – estimates suggest ~80–90% fewer companies affected
§ Mandatory sustainability reporting using ESRS standards now applies only to large undertakings meeting both thresholds:
§ Net turnover > €450 million and
§ Average > 1,000 employees during the financial year. This applies at individual and group level, including listed companies except micro-undertakings, which were already largely excluded.
§ Listed SMEs and many mid-sized/large firms below these thresholds are removed.
§ Voluntary reporting remains possible (facilitated by new simplified voluntary standards based on EFRAG SME standards).
§ Third country (non-EU) undertakings: Scope limited to parent companies with > €450 million net turnover in the EU, or subsidiaries/branches with > €200 million EU turnover.
Further changes not so relevant for our business:
§ Exemptions & transitions:
§ Financial holding companies exempted.
§ European Financial Stability Facility (EFSF) exempted (aligned with ESM).
§ Transition relief for “Wave 1” companies (those reporting since FY 2024) that now fall out of scope – exempted for FY 2025/2026.
§ Assurance / audit rules (amendments to 2006/43/EC):
§ Audit firms for sustainability assurance no longer need full statutory audit approval, only designate at least one key sustainability partner (approved statutory auditor).
§ Limited assurance standards: Adoption deadline postponed from October 2026 to July 1, 2027.
§ Reasonable assurance standards (higher level): Requirement to adopt by 2028 removed to avoid cost increases.
§ Third-country auditors: Transitional simplified registration (basic info only, no full oversight initially).
§ Other: Commission to revise ESRS within 6 months (focus on removing low value datapoints, prioritizing quantitative info, better materiality guidance, interoperability with global standards). Coherence with financial sector rules to be reviewed.
Key Changes to CSDDD (Due Diligence – Directive 2024/1760)
While the provided pages focus more on CSRD/assurance, the full directive includes:
§ Scope narrowed to very large companies: > 5,000 employees and > €1.5 billion net turnover.
§ Non-EU companies: > €1.5 billion EU turnover.
§ Obligation to adopt a climate transition plan removed.
§ Transposition deadline extended to July 26, 2028; application delayed (full obligations from ~2029).
For the absolute latest official text, check the EU Official Journal (published Feb 26, 2026) or Consilium data portal (PE-66-2025-REV-2).
We will continue to discuss the impact on our business area within the Sustainability working group and incorporate the findings into the text at a later date.