EU Parliament Approves Omnibus Deal Removing 90% of Companies from CSRD

The European Parliament has approved the provisional Omnibus I agreement with 428 votes in favour and 218 against, formally advancing the package that will sharply reduce the number of companies subject to the Corporate Sustainability Reporting Directive and Corporate Sustainability Due Diligence Directive. The agreement still requires endorsement by EU member states in the Council before entering into force.

The approved agreement raises the CSRD threshold to companies with at least 1,000 employees and €450 million in annual revenues, removing an estimated 90% of companies from sustainability reporting requirements compared to the pre-Omnibus regulation. The CSDDD threshold has been raised even more sharply to 5,000 employees and €1.5 billion in revenue, removing the vast majority of companies from due diligence obligations. The agreement limits information companies can request from smaller value chain partners to that outlined in the voluntary sustainability reporting standard for SMEs (VSME) for suppliers with fewer than 1,000 employees.

The Parliament's vote formalises significant changes to the CSDDD including the removal of the obligation for companies to prepare climate transition plans aligned with the Paris Agreement and the elimination of the EU-wide civil liability regime, with companies remaining liable at the national level. Penalties are capped at a maximum of 3% of global revenues. The agreement retains review clauses for both regulations, meaning scope could potentially be expanded in future if political conditions change. For non-EU companies including those with significant EU revenues, the new thresholds of €450 million for CSRD and €1.5 billion for CSDDD determine which entities remain in scope.

Parliament Rapporteur Jörgen Warborn described the vote as delivering historic cost reductions while keeping Europe's sustainability goals on track. The agreement requires formal endorsement by member states in the EU Council, which is the final step before it can enter into force. Once adopted, the revised CSRD and CSDDD thresholds will significantly reshape the landscape of mandatory sustainability reporting and due diligence in Europe, reducing the reach of regulations that had been set to become the world's most comprehensive corporate sustainability disclosure and supply chain accountability frameworks.

Key figure — 428 votes in favour, 218 against