On February 26, the European Commission presented a roadmap aimed at simplifying the texts of the European Green Deal. The objective is to reduce administrative burdens by 25% by 2029 (35% for SMEs) by easing reporting obligations while maintaining sustainability goals.
Main Amendments
CSRD
80% reduction in the number of companies subject to sustainability reporting.
- New criteria : more than 1,000 employees, turnover > €50M or balance sheet > €25M.
- Restriction of data requests to value chain companies not covered by the CSRD. Companies subject to the CSRD may only require from their suppliers data that complies with the VSME standard, except for certain sector-specific sustainability information.
- Application of reporting obligations to non-European groups generating €450M in Europe and to their European subsidiaries or branches reaching €50M.
- Establishment of a voluntary standard (VSME) for out-of-scope SMEs, promoting optional disclosure.
- Removal of future sector-specific standards and simplification of existing ESRS, by reducing the number of mandatory data points and prioritizing quantitative data.
- Limitation of the collective responsibility of management bodies regarding the digitization of the report upon its publication in a single electronic format, including digital tagging.
- Two-year postponement (until 2028) of reporting obligations for certain companies and listed SMEs.
- Elimination of any potential reasonable assurance requirement. Adoption in 2026 of targeted assurance guidelines, replacing a binding regulatory framework.
CSDDD
- Monitoring limited to direct suppliers and subcontractors, thereby reducing the scope of control and ESG compliance requirements.
- Reduction in the frequency of compliance assessments (every 5 years, except in the event of a change of supplier, environmental incident, or serious report requiring an early reassessment).
- Restriction of information requests to SMEs and mid-caps in value chain mapping by large companies to avoid the feared “trickle-down” effect.
- Limitation of the concept of “stakeholders” to workers, representatives, and directly affected persons or communities, with consultation restricted to the relevant stage of the ongoing due diligence process.
- Removal of the obligation to implement climate plans; only the mention of their adoption is maintained.
- Removal of the review clause that would eventually allow for the inclusion of financial services.
- Member State discretion to define civil liability rules and decide on possible remedies without an obligation for unions and NGOs to initiate actions.
- Removal of the obligation to terminate business relationships with a commercial partner involved in a violation.
- Removal of the cap on fines at 5% of global turnover.
- One-year postponement (2028) of due diligence requirements for large companies and bringing forward the guidelines by one year (to July 2026).
Green Taxonomy
- Easing of EU taxonomy reporting obligations, which will be limited to companies with more than 1,000 employees and €450M in turnover, and will remain optional for others.
- Introduction of a voluntary opt-in regime for large companies with more than 1,000 employees, with either a turnover exceeding €50 million or a total balance sheet exceeding €25 million, and whose net turnover does not exceed €450 million.
- Publication of turnover and Capital Expenditure (CapEx) KPIs, with the option to disclose Operating Expenditure (OpEx) KPIs by companies claiming partial or total alignment of their activities.
- Removal of compliance costs for companies not reporting sustainable activities, offering more flexibility to report activities according to certain technical criteria.
Implementation
- Deadline for transposition by Member States : 12 months after entry into force.
- Two-year postponement of the application of CSRD reporting obligations for large companies and listed SMEs.
- Proposal to postpone by one year the application of due diligence for large companies (to July 26, 2028) and to bring forward the adoption of guidelines to July 2026.
- Regarding monitoring and evaluation, the Commission will publish an evaluation report on implementation by 2029 for the CSRD and 2030 for the CSDDD.
Next steps
Following the approval of the so-called “Stop the Clock” mechanism by the European Parliament on April 3, 2025, and formal validation by the European Council possibly in the coming days, the entry into force of the CSRD is postponed by two years for the first companies concerned, while the CSDDD is delayed by one year. Parliamentary discussions continue regarding the CSRD, its scope, reporting, and due diligence, with a legislative revision expected by October 2025.