General interpretation concerning acceptance of changes to CSRD as part of Omnibus 1 implementation on 16 October 2025

EU Corporate Sustainability Reporting Directive (CSRD)  

Scope  

• The updated directive applies to enterprises employing more than 1,000 staff and generating at least EUR 450 million in turnover.  

• Certain exemptions are granted to listed subsidiaries and financial holding entities, provided specific conditions are met regarding management involvement.  

• Firms that no longer fall within the scope, but were obliged to report under CSRD this year, will be relieved from reporting duties for the 2025 and 2026 financial years, subject to national implementation.  

• A review clause has been introduced, leaving room for future expansion of the scope or the creation of a simplified reporting framework.  

Value Chain Restrictions  

• The revised rules set boundaries on the type of information companies can demand from smaller business partners with fewer than 1,000 employees (termed protected undertakings).  

• For reporting purposes, requests are limited to the Voluntary SME Standard (VSME), which is expected to be adopted via Delegated Act in 2026. Under the Omnibus agreement, any request beyond VSME must be clearly communicated, and the protected undertaking retains the right to decline.  

• These restrictions do not apply when information is collected for due diligence or risk management activities.  

Sector-Specific Standards  

• The final compromise removes mandatory sector-specific standards. Instead, reporting entities may request the development of sectoral guidance to aid in applying the ESRS and conducting double materiality assessments across different industries.  

What does it mean for business  

While the legislation has been simplified, the EU has not reversed its direction on sustainability governance. Transparency, risk management, and accountability remain core expectations for large companies operating in or with the European Union.  

CSRD Changes vs. Business Reality  

On one hand…  

• Fewer companies will now fall under the revised CSRD scope.  

• Reporting obligations are lighter for many.  

On the other hand…  

• Environmental and social risks for business remain very real.  

• These risks must still be addressed through due diligence and risk management.  

Key message: Even if reporting requirements shrink, responsible risk mitigation stays essential for resilience and trust.