Omnibus initiative to simplify reporting obligations in sustainability reporting – current developments and outlook

published on 17 February 2025 | reading time approx. 2 minutes

The first CSRD-compliant sustainability reports have been published in recent weeks, and although the CSRD has yet to be transposed into German law, the majority of companies in the CSRD user group in Germany have already initiated the reporting process. However, against the backdrop of the European Union's planned reduction in bureaucracy, there may now be some changes to the obligations to disclose extensive environmental, social and governance information: With the Omnibus initiative, the EU is aiming for a comprehensive reduction in reporting obligations, including in the area of sustainability reporting.

What is the aim of the Omnibus initiative?

With the publication of the “Budapest Declaration” on November 8, 2024, the European Council officially announced that the European Union plans to present a proposal to reduce general reporting obligations by at least 25% in the first half of 2025. The plans were concretized by the “EU Competitive Compass” presented on 29 January 2025 and the “2025 Commission Work Programme” published on 11 February 2025, which envisage a reduction in reporting obligations of at least 25% for all companies and at least 35% for SMEs as a central objective of the initiative. The resulting reduction in bureaucracy is primarily intended to strengthen EU competitiveness.

What simplifications are planned?

According to the EU Commission, the simplification process will begin in February 2025 with the presentation of the first of several “omnibus packages”. This is to include far-reaching simplifications in the areas of sustainability reporting (CSRD/ESRS), due diligence (CSDDD) and the EU taxonomy. At least two further omnibus packages are also to be presented within the first half of 2025.

The following requirements for the first omnibus package are explicitly stated in the EU Competitive Compass:

Appropriate schedules
Reporting obligations that are proportionate to the size of the company
Addressing the trickle-down effect so that smaller companies along the supply chain are not subject to disproportionately high reporting obligations that were not originally intended for them
Definition of a new category for “small mid-caps” (companies larger than SMEs but smaller than large companies), which are to benefit from tailored regulatory relief similar to SMEs
Better alignment of requirements with the needs of investors
Simplification of the Carbon Border Adjustment Mechanism (CBAM) for smaller market participants

Outlook: What changes to the reporting obligations are to be expected and what are the next steps?

Based on the information officially available to date, the following changes to the reporting obligations for sustainability reporting are considered likely:

Postponement of the time of application
Adaptation of the user group
Reduction of the required report content and the number of data points

It is not yet possible to estimate the extent to which these adjustments will actually be made. According to the provisional agenda, the presentation of the first omnibus package by Commission President Ursula von der Leyen and Executive Vice-President Stéphane Séjourné is currently scheduled for the Commission meeting on February 26, 2025. From this date, the concrete effects of the initiative on reporting obligations in the area of sustainability reporting should then be known. We will keep you up to date on this.