New deadlines and alternative courses of action for the Corporate Sustainability Reporting Directive (CSRD): The EU has made adjustments as part of the omnibus procedure, reducing reporting obligations and the scope for companies. We have summarized the most important information for you.
Omnibus procedure: Reduced reporting requirements for fewer affected parties
In December 2025, the European Parliament, the European Commission, and the European Council agreed on amendments to the Corporate Sustainability Reporting Directive (CSRD). Going forward, only companies with more than 1.000 employees and a turnover exceeding €450 million will be subject to CSRD reporting. These EU amendments still need to be transposed into national law by Germany. This has not yet occurred, so the National Sustainability Reporting Directive (NFRD) continues to apply. However, it is expected that Germany will adopt the EU amendments verbatim. Companies exceeding the new thresholds that have not yet reported under the NFRD will be required to report for the first time in the 2027 financial year.
Part of the initiative also included revising the European Sustainability Reporting Standards (ESRS). The aim is to reduce reporting requirements for companies. This includes reducing the number of data points by approximately 66% and simplifying processes such as materiality analysis. The European Commission adopted the delegated act to simplify the ESRS on July 3. Before the adopted delegated act can finally enter into force, it must be submitted to the European Parliament and the Council of the EU for review under the so-called no-objection procedure. The deadline is two months. The new, so-called Simplified ESRS can be viewed here: European Commission Publishes Delegated Act on Revised ESRS and Voluntary Sustainability Reporting Standard | EFRAG
"Stop-the-Clock" policy: Postponed deadlines are law.
The CSRD reporting obligation has been postponed for companies becoming subject to reporting for the first time. The following new deadlines were adopted at EU level on April 15, 2025, and were to be implemented by EU Member States by December 31, 2025:
- Large companies are reporting for the first time on the financial year 2027 (instead of 2025).
- Listed SMEs will report on the financial year 2028 for the first time (instead of 2026).
There are no changes to the reporting deadlines for companies that were already required to report under the predecessor legislation to the CSRD, the so-called NFDR or the CSR-RUG.
The VSME becomes the VS - Introduction of the Voluntary Standard
Since December 2024, the VSME (Sustainable Sustainability Reporting Guidelines) has provided voluntary guidance for sustainability reporting by small and medium-sized enterprises. On July 3, 2026, the European Commission adopted the new Voluntary Standard (VS) as a delegated act, intended to replace these guidelines. It is currently undergoing the so-called no-objection procedure: the EU Council and the European Parliament have two to a maximum of four months to object to the act – they do not have the right to amend its content. If neither institution objects, the VS will automatically enter into force as binding EU law – even though reporting itself will remain voluntary. The previous VSME did not have this legal status.
The main differences between VSME and VS can be summarized as follows:
- Extended scope of application: The VS applies to all companies with up to 1.000 employees (instead of only to non-listed SMEs with up to 250 employees under the VSME).
- Value Chain Cap: Companies subject to CSRD regulations may not request sustainability data beyond the minimum requirements from supply chain partners with up to 1.000 employees.
- Content simplifications: Among other things, the GHG intensity is no longer a mandatory requirement.
Banks will require ESG data when granting loans in the future.
While the EU is working on a "CSRD light" version, the banking and financial sector remains very active in the area of ESG. After all, the relevance of sustainability risks continues to grow. New regulations from the European Banking Authority (EBA) address this: From January 1, 2026, credit institutions must assess ESG risks (e.g., from flooding or reputational damage) when granting loans (the so-called EBA guideline ). Even companies not subject to CSRD regulations will therefore have to provide ESG data to secure their creditworthiness and affordable loan terms.
The VSME standard helps to efficiently meet these requirements and to position oneself for the future with regard to banks and partners.
Supply chain regulations LkSG and CSDDD
Changes are also expected in the area of supply chain regulations. As part of the Omnibus procedure, a revision of the European Corporate Sustainability Due Diligence Directive (CSDDD) is planned, which is intended to simplify reporting obligations and require adjustments from the companies concerned. The coalition agreement of the new German government also refers to this and calls for a suspension of the reporting requirements of the German Supply Chain Due Diligence Act (LkSG) until the CSDDD is adopted. Until a decision is reached, the following requirements currently apply under the LkSG for companies with 1.000 or more employees:
- Implementation of due diligence obligations (e.g. conducting risk analysis)
- Initial review of the report as of January 1, 2026
Your contact person at Arqum: Thomas Nienhaus
Version of 23.07.2026
The content on this page reflects the current state of affairs at the time of publication. Please note that the legal situation may change in the future.