EU Parliament proposes further cuts to sustainability reporting requirements
May 22, 2025
A European Parliament committee has proposed measures to further reduce the number of companies that must comply with the EU’s sustainability reporting framework, going much further than the cuts proposed by the omnibus simplification package.
Initially, the European Commission’s omnibus package aimed to reduce corporate ESG requirements by limiting the Corporate Sustainability Reporting Directive (CSRD) to companies with over 1,000 employees and a turnover of more than €50 million.
However, the European Parliament’s Committee on Economic and Monetary Affairs (ECON) has suggested raising that threshold to companies with more than 3,000 employees and €450 million in annual revenue.
This change would further reduce the scope of the CSRD and its counterpart, the Corporate Sustainability Due Diligence Directive (CSDDD), which sets corporate responsibilities for environmental and human rights issues throughout value chains.
There are concerns that the changes to the CSRD and CSDDD could significantly reduce the expected availability of ESG-related data for investors and industry.
ECON justified the amendment, stating that the changes would support the goals of the omnibus package by simplifying rules and lowering the reporting burden for EU companies.
In addition, the committee recommends restricting mandatory ESG data points under the European Sustainability Reporting Standards to only 100, with 50 voluntary data points. This would be significantly fewer than what the commission originally proposed.
ECON also proposed the removal of the requirement for companies to adopt climate transition plans under the CSDDD, noting that companies are already required to do so under the CSRD.
The European Commission’s omnibus package is still under debate and may see further changes. Recently, the UN called on the EU to ensure that any changes of updates to the CSDDD aligned with international human rights standards.
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Last Updated: 22 May 2025