Sustainability (CSRD/CSDDD)

Overview

The EU sustainability framework rests on two instruments: the Corporate Sustainability Reporting Directive (CSRD), Directive (EU) 2022/2464, which governs what companies disclose, and the Corporate Sustainability Due Diligence Directive (CSDDD), Directive (EU) 2024/1760, which governs how very large companies manage adverse impacts. Both were substantially revised in 2025 and 2026, first by the stop-the-clock Directive (EU) 2025/794 and then by the Omnibus I Directive (EU) 2026/470, published on 26 February 2026.

Sustainability reporting (CSRD)

• revised scope: EU companies with more than 1,000 employees and more than EUR 450 million in net turnover, and non-EU groups with more than EUR 450 million in EU turnover and an EU subsidiary or branch above EUR 200 million;

• value chain: information that in-scope companies may request from smaller partners in their value chain is capped;

• transposition and timing: Member States must transpose the amendments by 19 March 2027, and companies of the second wave report for the first time in 2028, on financial year 2027;

• first-wave companies: those already reporting may be exempted by Member States if they fall below the new thresholds;

• standards: the Commission adopted simplified European Sustainability Reporting Standards (ESRS) on 3 July 2026, for financial years starting on or after 1 January 2027, and a voluntary standard for smaller companies (VSME).

Sustainability due diligence (CSDDD)

• revised scope: companies with more than 5,000 employees and more than EUR 1.5 billion in turnover (EU turnover, for non-EU companies);

• obligations: risk-based identification, prevention, mitigation and remediation of adverse human-rights and environmental impacts, stakeholder engagement and a complaints mechanism;

• changes made by Omnibus I: the obligation to adopt a climate transition plan was removed, the harmonised EU civil-liability regime was deleted and fines are capped at 3% of worldwide turnover;

• timing: transposition by 26 July 2028 and application from 26 July 2029.

Why it still matters for smaller organisations

Companies below the thresholds will continue to receive sustainability questionnaires from customers, banks and investors. A proportionate data set, aligned with the voluntary standard, helps them respond consistently and protects their position in supply chains.

How we can help

• Compliance Assessment: scoping under the new thresholds and a readiness review;

• Implementation Kits: materiality assessment, due-diligence and supplier-questionnaire templates;

• Alerts & Repository: monitoring of national transposition and of the ESRS;

• Training & Capacity: training for reporting and procurement teams.

Related domains: Third-Party & Supply Chain · Corporate Governance · Pay Transparency · Anti-Corruption

Official texts: Directive (EU) 2022/2464 · Directive (EU) 2024/1760 · Omnibus I, Directive (EU) 2026/470

General information as of October 2026; it does not constitute legal advice. Confirm the applicable requirements with the competent authorities.