A new draft report from the European Parliament’s Economic and Monetary Affairs (ECON) Committee proposes sweeping changes to the EU’s sustainability regulations, potentially removing tens of thousands of companies from the scope of corporate sustainability rules. The proposals significantly expand on the Commission’s CSRD Omnibus plan released in February.
That plan aimed to ease the reporting burden on businesses through amendments to core frameworks like the Corporate Sustainability Reporting Directive (CSRD) and Corporate Sustainability Due Diligence Directive (CSDDD). With pressure mounting to streamline regulation and reduce costs for companies, the ECON Committee’s proposed changes could dramatically reshape the future of sustainability reporting in Europe.
CSRD thresholds could rise to 3,000 employees
Under the current Omnibus proposal, the CSRD scope would be limited to companies with more than 1,000 employees and €50 million in turnover – already a significant scaling back from the original legislation.
However, the ECON draft proposes raising that threshold further to 3,000 employees and €450 million in annual revenue, slashing the number of businesses required to report even more drastically. This would further reduce administrative load but effectively remove nearly all medium-sized businesses from CSRD obligations, undermining what was originally designed as a broad, transformative shift in corporate sustainability transparency and accountability.
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Limits on ESRS data points and climate planning
In addition to narrowing scope, the draft amendment introduces hard limits on reporting detail. It proposes capping mandatory ESRS (European Sustainability Reporting Standards) data points at 100, and voluntary points at 50 – a move that would simplify reporting but risk limiting meaningful disclosure.
The report also eliminates the climate transition plan requirement under the CSDDD, arguing that this obligation is already covered under the CSRD. Critics say this duplication concern could be addressed without removing a core pillar of corporate climate accountability.
Diverging views within the Parliament
The ECON Committee’s proposal underscores the deep divisions within the EU institutions on the future of sustainability regulation. Initial debates in March revealed conflicting priorities, with some MEPs seeking to scrap CSRD and CSDDD entirely, and others demanding that existing obligations remain intact to maintain the EU’s climate leadership. The proposed changes also raise questions about alignment with global sustainability reporting trends, including ISSB and SEC frameworks, as well as the EU’s own Green Deal ambitions.
Conclusion
As policymakers debate the extent of regulatory relief, the signal to businesses remains mixed. But the market trend is clear: investors, customers, and supply chain partners continue to demand transparency, climate action, and ESG accountability, regardless of shifting thresholds.
Now more than ever, organisations must take control of their sustainability strategy. That starts with building internal capability. Enrol in our CSRD Course to ensure your organisation is equipped to meet evolving requirements, interpret ESRS standards, and transform reporting into strategic value, no matter what shape the final legislation takes.
