The European Commission has presented a comprehensive package of amendments to the CSRD and CSDDD directives, which includes a two-year postponement of corporate sustainability reporting obligations for the second and third wave of companies and a one-year postponement of the transposition and implementation of the CSDDD. This move creates uncertainty as the European Parliament and the Council of the EU, as co-legislators, have different views on the scope and requirements of the directives.

CSRD:

– Postponement of duties: Companies that were supposed to report in 2026 and 2027 will only be able to report in 2028 and 2029. Obligations for 2025 remain unchanged.

– Range: Mandatory reporting will be limited to large companies with more than 1,000 employees and a turnover of over EUR 50 million or a balance sheet of over EUR 25 million. SMEs and companies with up to 1,000 employees will be excluded. The net turnover threshold for non-EU companies will be increased to EUR 450 million.

– ESRS: The delegated act will reduce the number of mandatory data, clarify the provisions and improve compliance with EU legislation and global standards. The requirement for double relevance remains.

– Taxonomy: Large businesses can voluntarily report on the taxonomy, which provides more flexibility.

CSDDD:

– Postponement: The transposition deadline is postponed to 26 July 2027 and for companies to 26 July 2028.

– Simplified due diligence: Measures will be limited to own operations, subsidiaries and direct suppliers (Tier 1). More in-depth assessments of indirect partners will only be necessary if there is evidence of adverse impacts.

– Monitoring: The frequency of reassessment will be reduced from annual to five-yearly.

– Fines: Abolition of the minimum ceiling for fines and the specific civil liability regime.

– Climate change plan: The proposal deletes the requirement to "put into effect" a climate change plan, instead requiring the inclusion of implementation measures in line with the CSRD.

Next steps and aspects:

The package also includes proposals to amend the carbon border regulations and delegated acts on taxonomy and climate action. The legislative proposals will be submitted to the European Parliament and the Council for approval. The Commission calls for a priority assessment of the package, in particular the first directive, with a transposition deadline of 31 December 2025 and a subsequent 12-month period for further amendments.

The proposed changes bring more uncertainty than solutions, requiring rapid decisions and harmonisation between the CSRD, CSDDD and the EU taxonomy. The Commission is trying to reduce the regulatory burden while maintaining the effectiveness of the regulations, but not all companies support the proposal, some require more consistency and clarity. It is important to monitor legislative developments and prepare for possible legal risks and reputational damage in the event of non-compliance with the CSRD. Spring