Omnibus Adopted, Updated ESRS Proposed – What Do We Do Now?

Omnibus: What Applies Going Forward?

The Omnibus I package, aimed at simplifying sustainability reporting and reducing administrative burden, was adopted at the end of last year. Below we summarize the main changes.

CSRD – Sharp Reduction in the Number of Companies Affected

• Significantly raised thresholds: companies with 1,000 employees and 450 million euros in revenue are in scope (approx. 90% fewer companies affected compared to the original thresholds)
• Financial holding companies are exempt.
• EU has opened up for transitional exemptions for companies currently in scope but falling out under the new thresholds; however, these must be implemented in national legislation before companies can apply them, making it unlikely they can be used for FY2025.
• Value chain data is limited as smaller companies may refuse larger actors information beyond the VSME standard.
• The Commission is mandated to develop sector-specific support and guidance.
• A review clause opens the door for future expansions and adjustments.

The remaining step now is to await the Swedish implementation. An investigation on this is to be presented on April 17, 2026.

EU Taxonomy – Simplifications in Reporting

• Companies in scope of CSRD are also covered by the taxonomy.
• Simplifications implemented apply from FY2026 onward.
• For FY2025 reports (if submitted after January 28, 2026), companies may choose whether to apply the old or new requirements.
• Focus on reducing complexity and strengthening proportionality, including:

  – Adjusted DNSH criteria

  – Fewer and simpler reporting templates

  – Introduction of a materiality threshold

CSDDD – Postponed and Simplified

• Thresholds significantly raised: 5,000 employees and 1.5 billion euros in revenue.
• A risk-based approach replaces the strictly limited value chain.
• Requirements for climate transition plans removed.
• The harmonized liability mechanism removed.
• Sanctions capped at 3% of global revenue.
• Implementation postponed until July 2029.
• The Commission will publish guidance by July 2027.

New Simplified ESRS – What Do the Changes Mean?

In November 2025, the Draft Simplified ESRS was presented, simplifying the reporting standards under CSRD. The purpose is to reduce unnecessary data collection, increase clarity, and ensure proportionality. The draft includes, for example:

• 61% fewer data points
• Shorter, more accessible standards
• Clarified definitions
• Proportionality mechanisms adapting requirements to company size
• Additional phase-ins
• Option to include a summary section at the beginning of the sustainability report
• Simplified double materiality assessment
• Eased value chain data requirements with a three-year transition period

Changes may be made in the next step as the Commission adopts an updated ESRS.

How Should Companies Act Now?

After Omnibus I, it is clear that sustainability work cannot rely solely on legal compliance. Even before, simply following legal requirements was insufficient without considering organizational and stakeholder needs. With the high and quickly implemented requirements of CSRD, many companies struggled to focus on anything beyond compliance.

Sustainability work must again be driven by what creates value for the organization today and in the future. The world is moving extremely fast regardless of how much the legislation is rolled back. Geopolitics, climate change, and resource constraints represent financial risks and opportunities that must be managed now to ensure competitiveness. Combined with increased sustainability maturity, stakeholder expectations are rising. Companies excluded from the legal requirements should also remember that regulations drive expectations within the value chain, even if they are now more limited.

Regarding sustainability reporting, Omnibus I provides relief for affected companies but also increases the need to navigate the landscape independently. Companies no longer covered by the requirements can still use the standards for voluntary reporting, where value creation should guide the extent. The standards will support internal governance, comparability between companies, and transparency toward stakeholders.

Going forward, it will be important to follow the Swedish implementation of the legal requirements as well as rapidly evolving practice and stakeholder expectations.

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