The New Status After the Omnibus I Package
Europe’s sustainability reporting is facing a fundamental restructuring: On November 13, 2025, the European Parliament adopted its negotiating position on the CSRD reform with 382 votes in favor, 249 against, and 13 abstentions. With this, the trilogue phase with the Council and the Commission officially began on 2025-11-18; the outcome could significantly limit the scope of companies subject to reporting requirements. The goal is to reach an agreement before the end of the year so that the new legal framework can take effect in time before the start of the next reporting cycle.
What the New Proposal Entails
According to the European Parliament’s view, in the future, only companies or group parent companies will be subject to reporting requirements if they
- have an average of more than 1,750 employees and
- generate annual sales revenues of more than €450 million.
These thresholds are to apply uniformly for both the CSRD and the EU Taxonomy. The consequence is far-reaching: according to estimates, around 90% of the previously expected reporting companies would no longer fall under mandatory sustainability reporting.
Furthermore, the Omnibus Package provides for additional simplifications:
- The formal reporting obligations and standards are to be streamlined,
- the focus is to be placed more strongly on essential, quantitative information,
- sector-specific additions are no longer mandatory in the future, but at most voluntary.
Why This Step Now – and What It Means
The reform comes at a time when many companies are in the process of establishing their sustainability processes for CSRD. A clear reduction in obligations means planning certainty for these companies, but also uncertainty as to whether invested time and resources were justified.
For large parts of the SMEs, the change could mean no longer having an EU obligation for sustainability reporting. However, the ever-growing expectations of investors, banks, and business partners remain. Transparency and ESG data will continue to be demanded – regardless of whether a legal obligation exists or not.
Why It’s Not Just About Less Bureaucracy
The Parliament’s decision comes at a phase where political majorities are shifting and new alliances are emerging. Critics note that this simplification could go far beyond the goal of reducing bureaucracy and instead be a step backward for ESG transparency. Those who have already invested in reporting structures could de facto be “punished” by the new thresholds. Meanwhile, voluntary sustainability reports and private ESG ratings are gaining importance; the competition for credibility is increasingly shifting from the legislator to the market.
Even if the CSRD obligation is more narrowly defined in the future, ESG transparency remains a central issue for many stakeholders. Companies that have already established data processes, supplier reporting, or sustainability governance clearly have an advantage.
Conclusion
The reform of the CSRD through the Omnibus procedure is no small matter – it changes who will have to report in the future and how strict the requirements are. For German SMEs, this is likely to mean relief from formal obligations.
However: The market dynamics remain. ESG transparency, supply chain sustainability, and sustainable governance will not disappear; they are transforming. Companies and consultants who position themselves broadly and future-oriented now strengthen their competitiveness – whether legally obliged or voluntarily engaged.
