Simplification of the CSRD, the CS3D and the Taxonomy: what will this mean for businesses?
The European Commission has announced its intention to simplify and harmonise the reporting framework for European companies. With this in mind, on 26 February it officially presented the "Omnibus Package", a set of proposals aimed at simplifying and adjusting the texts of the CSRD, the Green Taxonomy and the Duty of Vigilance Directive, the CS3D.
An "Omnibus" law is a piece of European legislation that brings together several amendments to existing directives or regulations in a single act. Its purpose is generally to adjust several pieces of legislation at the same time, thus avoiding the need to adopt several separate texts.
What are the main changes announced? What happens next in the legislative process? How can companies adapt and anticipate in this regulatory context?
Deciphering the Omnibus package and the actions to be taken.
What are the main changes announced?
Simplification of CSRD and ESRS
Lowering of applicability thresholds
The CSRD (Corporate Sustainability Reporting Directive) currently applies to companies with more than 250 employees and sales in excess of €40 million. It requires detailed reporting based on the European Sustainability Reporting Standards (ESRS), covering environmental, social and governance (ESG) criteria, to strengthen transparency and corporate responsibility in terms of sustainability.
One of the most emblematic measures of the Omnibus project is the lowering of the thresholds for the directive's applicability, reducing the number of companies concerned.
If the proposal is adopted, the CSRD will only apply to companies with more than 1,000 employees and a turnover of €50 million, thereby exempting more than 80% of the companies initially concerned.
As a result, the number of companies included in the scope of the CSRD would fall from more than 50,000 to less than 10,000 companies.
The thresholds for non-European companies have also been raised, from €150 million to €450 million turnover.
The revision of these thresholds would be justified by a desire to align the CSRD with the CS3D.
Voluntary reporting by SMEs
Review of ESRS
It has been proposed that the ESRS be revised, in particular by simplifying the structure and presentation of the reporting standards.
The revision also provides for a reduction in the number of mandatory data points, prioritisation of quantitative data over narrative elements, and improved interoperability with international reporting standards.
This simplification proposal will be presented in the form of a delegated act no later than 6 months after the entry into force of the Omnibus Directive.
Clarifications on dual materiality
Audits
"Stop the clock": publication reports
Cancellation of sector ESRSs
2. Reduction in the scope of the CS3D
The CSDD or CS3D (Corporate Sustainability Due Diligence Directive) requires large companies to prevent and mitigate the negative impacts of their activities on human rights and the environment. To achieve this, companies must identify and assess the impacts of their activities across their entire value chain (upstream and downstream). The Directive applies to companies with a turnover in excess of €450 million and more than 1,000 employees.
With the Omnibus project, the scope of the CS3D should be reduced:the supplier risk assessment, initially intended to cover indirect suppliers, would now be applied only to direct suppliers. It would only be extended to indirect suppliers in the event of plausible information suggesting negative impacts - real or potential - at their level.
Other changes made to the CS3D by the Omnibus Package:
- A one-year postponement of the date of entry into force of the directive, with the first wave of application abolished in 2026, and application in waves between 2027 and 2029,
- Suppliers will be monitored every 5 years, instead of annually,,
- As part of the mapping of the value chain, the amount of information that can be requested from ETIs and SMEs will be limited,
- The penalties applicable will be limited,,
- The obligation to terminate the commercial relationship in the event of infringement by suppliers should also be removed from the text.
3. Revision of the European Green Taxonomy
The European Commission has decided to harmonise the CSRD and CS3D criteria with the Green Taxonomy.
Changes introduced by the Omnibus Package:
- Limited to large companies with more than 1,000 employees and sales of €450 millionThe Taxonomy would remain optional for other companies,
- The introduction of materiality thresholds for economic activities, and a reduction in the number of data points to be reported,
- Simplification of the DNSH ("Do No Significant Harm") for certain criteria.
And now?
The draft is therefore likely to evolve over the coming months. The final text is not expected to be adopted before 2026, after which it will have to be transposed into the national laws of the Member States. However, the Commission has invited the other European bodies to give priority to the Omnibus Package.
What impact will this have on businesses and how can they prepare for it
The text of the CSRD as adopted and transposed in the Member States continues to apply until the amending texts are published.
As a result, companies currently subject to the CSRD must continue their reporting efforts. The investments made to date provide a solid basis for meeting the requirements of transparency and sustainability, which remain at the heart of European regulations.
The reduction of certain obligations does not mean a relaxation of ESG reporting expectations, but rather a clarification and optimisation of processes.
In this context of uncertainty, where the text has yet to be negotiated and finalised, there are still levers for improvement for companies:
- Establish or maintain robust governance for ESG reporting: a well-structured organisation and a clear division of responsibilities remain essential to ensure reliable and progressive reporting,
- Optimise data collection and management: simplify and automate reporting processes to increase efficiency while ensuring compliance with future requirements,
Adapting your strategy to regulatory changes: keeping a close eye on European decisions and gradually adjusting your reporting to take account of new guidelines will help you avoid hasty and costly adjustments.
Working alongside a number of major companies, our ESG experts are available to discuss and share best practice in transforming ESG management models.
Conclusion
VPWhite has positioned itself as a strategic partner to support companies in the face of these regulatory changes, enabling them to adopt more effective and optimised reporting.
ESG 
EHS 
LEGAL 
REM 
GRC
PERFO
