On February 27, the European Union will publish the details of the Omnibus Regulation, an attempt to simplify ESG regulations for businesses. If your company needs to comply with the CSRD 2025, CSDDD, or the EU Taxonomy, this is something you should pay attention to.
Brussels has admitted that ESG regulation has become overly complex and expensive. To simplify compliance, the EU is considering merging three key regulations into a single framework, making reporting easier for businesses.
● CSRD → Requires companies to report on sustainability impacts, risks, and strategies.
● CSDDD → Mandates identifying and eliminating negative impacts on human rights and the environment within the supply chain.
● EU Taxonomy → Defines which of your company’s activities can be considered sustainable for investment purposes.
This potential change is being driven by pressure from countries like Germany and France, which have called for a reduction in regulatory burden to prevent European businesses from losing competitiveness. In January, Germany proposed delaying the CSRD by two years, while France called for a "massive regulatory pause" to reassess existing ESG requirements.
The EU has realized that regulating without clear guidance or support for implementation can be ineffective, which is why it is now pushing for simplification.
● Shorter reports: CSRD requirements may be reduced by 25% for large companies and up to 35% for SMEs.
● Extended deadlines: Germany and France are pushing for a two-year delay in CSRD implementation.
● Supply chain adjustments: Small businesses in large supply chains may face fewer reporting obligations.
● Sector-specific focus: Some metrics could be relaxed for companies with lower environmental impact.
● Financial metric adjustments: Certain criteria may be revised to prevent overregulation from discouraging investment in SMEs and mid-sized businesses.
At the same time, the EU is working on new decarbonization strategies for 2040, including a 90% reduction in CO₂ emissions and the development of a Climate Change Adaptation Plan. Even with regulatory simplification, sustainability will remain at the center of EU policy.
We are still waiting for confirmation, and nothing will be certain until February 27. However, the Omnibus Regulation could impact your business if:
● You report under the CSRD: Your workload may decrease, but data collection will remain a challenge.
● You are a supplier to large companies: You will still need to provide ESG data, though possibly with less strict requirements.
● You seek financing or contracts in the EU: ESG criteria will remain key for banks, investors, and clients.
This change is not happening randomly. Three key factors are driving the revision:
● The EU is losing competitiveness → Strict sustainability regulations are hindering business innovation and global growth.
● Political changes in the EU → After the 2024 European elections, there is increased pressure to reduce bureaucracy and simplify ESG rules.
● The Draghi Report → Published in late 2024, this report warns that excessive regulation is slowing economic growth and that the EU needs simpler rules to balance sustainability and competitiveness.
Many businesses are still struggling to adapt to CSRD, CSDDD, and other ESG regulations. The lack of training, specialized teams, and administrative complexity has made ESG compliance a major challenge.
We don’t yet know exactly what will happen, but waiting is not a strategy. Changes are coming, and preparation is key.
Join our live webinar on March 6, where we will explain what has actually changed and what you need to do to adapt.
Reserve your spot here.
