European Commission Launches Omnibus Package to Streamline Sustainability Reporting and Boost Compliance

The European Commission has unveiled the Omnibus Package, a pivotal regulatory reform initiative aimed at simplifying sustainability reporting for businesses across the EU. Launched by European Commission President Ursula von der Leyen on November 8, 2024, this comprehensive package is designed to streamline sustainability-related legislation and reduce the regulatory burden on companies.

Overview of the Omnibus Package

Officially published on February 26, 2025, the Omnibus Package strives to harmonize existing sustainability regulations within various sectors. It focuses on two primary objectives:

• Minimizing administrative burdens related to sustainability compliance.
• Aligning corporate sustainability reporting requirements.

Key Legislative Impacts

The Omnibus Package significantly affects three major sustainability laws:

1. EU Supply Chain Directive (CSDDD)
2. Corporate Sustainability Reporting Directive (CSRD)
3. EU Taxonomy Regulation

Structure of the Reform

The Omnibus Package is divided into two main components:

Omnibus I

Omnibus I introduces amendments to essential sustainability directives, including:

• Corporate sustainability reporting framework.
• Carbon border adjustment mechanism.

Omnibus II

This part focuses on enhancing the efficiency of EU guarantees and streamlining reporting requirements, particularly in financial regulations.

Call for Evidence

A Call for Evidence has been issued to amend key EU Taxonomy Delegated Acts, which include:

• Taxonomy Disclosures Delegated Act
• Taxonomy Climate Delegated Act
• Taxonomy Environmental Delegated Act

Significant Reforms Under CSRD

One of the most notable reforms involves the CSRD, effective from January 5, 2023. This directive mandates companies to report sustainability information following the European Sustainability Reporting Standards (ESRS). Key changes proposed in the Omnibus Package include:

• Reducing the CSRD’s reporting burden by limiting its scope.
• Introducing voluntary reporting standards.
• Postponing certain reporting deadlines.
• Exempting large companies with fewer than 1,000 employees and all listed SMEs from mandatory reporting.
• Discontinuing sector-specific ESRS, thus reducing prescribed data points.

Additionally, the package proposes delaying reporting obligations for certain companies by two years.

Changes to the EU Taxonomy Regulation

Another focal point of the Omnibus Package is the EU Taxonomy Regulation. Companies will now have the option to opt out of Taxonomy disclosures if they do not claim alignment with the EU Taxonomy framework.

Amendments to the CSDDD

The EU Supply Chain Due Diligence Directive (CSDDD), adopted on June 13, 2024, is also set to undergo amendments. Proposed changes include:

• A one-year delay for the initial implementation phase.
• Relaxation of climate transition plan requirements.
• Reducing due diligence monitoring frequency from annual to every five years.
• Removing the minimum cap for financial penalties.
• Scaling back the requirement to terminate business relationships due to sustainability risks.

Next Steps for the Omnibus Package

The Omnibus Package is currently awaiting approval from the European Parliament and the Council. The European Commission has urged policymakers to prioritize these amendments, particularly those relating to CSRD disclosure requirements and the transposition deadline for CSDDD. Once adopted, the legislative changes will be published in the EU Official Journal before taking effect.

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