In February 2025, the European Commission launched the Omnibus package — the most significant change to CSRD since it was adopted in 2022. Scope was cut by 80%. Wave 2 and 3 deadlines were delayed by two years. ESRS mandatory datapoints were slashed by 61%. If you have been preparing for CSRD, your plan needs an urgent update.
⚠ Important
Wave 1 companies: nothing changed for you
The Stop-the-Clock directive and Omnibus scope changes do NOT apply to Wave 1 companies — large public interest entities with 500+ employees already reporting under NFRD. You are still required to report for FY2024 (published 2025) and FY2025. Only Wave 2 and Wave 3 companies received delays.
What is the Omnibus package?
The EU Omnibus I package was proposed by the European Commission on 26 February 2025. It consists of two distinct components. The first — the Stop-the-Clock directive — was adopted rapidly in April 2025 and simply delays CSRD deadlines for Wave 2 and Wave 3 companies by two years. The second — the substantive Content Proposal — makes deeper changes to scope, standards and requirements. The Content Proposal was provisionally agreed in December 2025 and formally adopted by the EU Council on 24 February 2026.
The political context matters. The Omnibus emerged from intense lobbying pressure from European business groups arguing that CSRD's compliance burden was damaging EU competitiveness. The Budapest Declaration in late 2024 set a target of reducing administrative burdens by 25% for all companies and 35% for SMEs. CSRD was the primary target.
~80%
Reduction in companies in CSRD scope
61%
Reduction in mandatory ESRS datapoints
+2yrs
Delay for Wave 2 and Wave 3 companies
1,000
New employee threshold (up from 250)
The new scope — who is still in CSRD?
The single biggest change in the Omnibus is the scope reduction. Under the original CSRD, companies meeting two of three criteria (250+ employees, €40M+ turnover, €20M+ assets) were in scope. The Omnibus narrows this dramatically — only companies with over 1,000 employees AND net turnover exceeding €450 million are now required to report under CSRD.
Original CSRD scope
- ▸250+ employees (one of three criteria)
- ▸€40M+ annual turnover (one of three criteria)
- ▸€20M+ total assets (one of three criteria)
- ▸Meet two of three criteria to be in scope
- ▸Approx. 50,000 EU companies affected
- ▸Listed SMEs included in Wave 3
Omnibus revised scope
- ▸1,000+ employees AND €450M+ net turnover
- ▸Both criteria must be met (AND not OR)
- ▸Approx. 5,000–10,000 EU companies affected
- ▸Listed SMEs removed from mandatory scope
- ▸Non-EU threshold: €450M EU turnover
- ▸New scope applies from FY2027 onwards
§ Key fact
The 250-employee company is out — mostly
A company with 300 employees and €50M turnover that was firmly in CSRD scope under the original directive is now out of mandatory scope under the Omnibus. However — and this matters — supply chain pressure means you will still face CSRD-equivalent data requests from your large customers who remain in scope. The obligation shifts from regulatory to commercial.
Updated CSRD deadline timeline
The Stop-the-Clock directive, adopted April 2025, delays Wave 2 and Wave 3 first reporting by two years. Here is the updated schedule as of March 2026 — reflecting both the Stop-the-Clock delay and the Omnibus scope changes.
Wave 1Hard
Large PIEs — unchanged
500+ employee public interest entities. First report FY2024, published 2025. No delay. Quick-fix ESRS relief applies for FY2025 and FY2026 reports.
Wave 2Medium
Large companies — delayed to 2028
Now: 1,000+ employees AND €450M+ turnover. First report FY2027, published 2028. Originally due 2026. Two-year delay granted by Stop-the-Clock.
Wave 3Easy
Listed SMEs — removed
Originally Wave 3 listed SMEs would report from 2027. Under Omnibus, listed SMEs are removed from mandatory CSRD scope entirely. Voluntary VSME standard available.
Wave 4Medium
Non-EU companies — delayed to 2029
Non-EU parent companies with €450M+ EU turnover. First report FY2028, published 2029. Scope threshold raised from €150M to €450M EU turnover.
ESRS simplification — 61% fewer mandatory datapoints
Separately from the scope changes, EFRAG submitted revised simplified ESRS standards to the European Commission in December 2025. These amended standards reduce mandatory datapoints by 61% and remove all voluntary datapoints. The Commission is expected to adopt them as a delegated act by mid-2026, with application from FY2027.
The simplification introduces a top-down approach to materiality — companies start with the full list of topics and work down, rather than building up from scratch. Topic disclosures now depend entirely on materiality assessment outcomes. ESRS 2 general disclosures still apply to all in-scope companies regardless of materiality.
What got simpler
- ▸61% fewer mandatory datapoints across all 12 standards
- ▸All voluntary datapoints removed entirely
- ▸Clearer materiality criteria — less ambiguity
- ▸Estimates and proxies explicitly allowed where data unavailable
- ▸Value chain data requests capped at VSME standard level
- ▸Sector-specific ESRS standards cancelled
What stayed the same
- ▸Double materiality assessment still mandatory
- ▸ESRS 2 general disclosures apply to everyone
- ▸E1 climate, S1 workforce, G1 governance still near-mandatory
- ▸Third-party limited assurance still required
- ▸XBRL digital tagging still required
- ▸Board approval of sustainability report still required
The value chain cap — what it means for supplier requests
One of the most commercially significant Omnibus changes is the value chain cap. Under the original CSRD, large companies could request unlimited sustainability data from their suppliers to satisfy Scope 3 and social disclosure requirements. Under Omnibus, companies in CSRD scope can only request information from smaller value chain partners (under 1,000 employees) that is covered by the forthcoming VSME voluntary standard.
✓ Practical tip
Suppliers: prepare for VSME-level requests
Even though SMEs are out of mandatory CSRD scope, your large customers will still request VSME-standard sustainability data from you. The VSME standard (expected as a delegated act in June 2026) will define exactly what they can ask for. Start preparing basic GHG, energy and governance data now — this is coming regardless of your formal CSRD obligations.
What should you do now?
The right response to the Omnibus depends entirely on which wave you are in and whether you remain in scope under the revised thresholds. Here is the decision framework.
ESRS E1 checklist
0/8 complete
Determine your new scope status — do you meet 1,000+ employees AND €450M+ turnover? Wave 1 companies: continue reporting, apply quick-fix ESRS reliefs for FY2025 and FY2026 Wave 2 companies still in scope: prepare for FY2027 first report — you have until 2028 Wave 2 companies out of scope: assess voluntary reporting and supply chain data obligations All companies: review double materiality assessment against simplified ESRS top-down approach Suppliers to large EU companies: prepare VSME-level data for customer requests Non-EU companies: check if you meet €450M EU turnover threshold — scope narrowed but still exists Monitor Omnibus delegated act adoption (expected mid-2026) for final ESRS simplification details ⚠ Important
Do not stop preparing because of the delay
The two-year delay is not a two-year pause. Companies that use this window to build proper data infrastructure, conduct materiality assessments and engage assurance providers will be in a dramatically stronger position than those that wait. The delay rewards preparation — it does not excuse it.
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