Financial Reporting & ESG

The Omnibus proposal: What does it mean for ESG reporting?

The Omnibus proposal: What does it mean for ESG reporting?

March 18, 2025
"A breathtaking mountain landscape with steep cliffs, green valleys, and a winding road, partially covered in mist. Snow-capped peaks are visible in the background under a cloudy sky.

The European Commission’s Omnibus 1 proposal, announced in February 2025, introduces significant regulatory changes aimed at simplifying sustainability reporting requirements under the Corporate Sustainability Reporting Directive (CSRD) and other key EU regulations. The proposal reduces compliance obligations for many companies, but ESG transparency remains a strategic priority for businesses navigating regulatory shifts and market expectations.

Process for final approval

The Omnibus 1 proposal is still in the legislative process and must go through several approval stages before becoming law. Following the European Commission’s proposal, the European Parliament and the Council will review, debate, and suggest amendments. Once their positions are aligned, final approval will come after trilogue negotiations, with implementation expected to begin in 2027–2028, depending on the final directive. After which each EU member state will need to implement these changes in their national laws.

The idea is that the postponing of deadline, the so called “Stop the clock” will be approved first as a more “fast track” approval that will give some time to work through and amend the other proposals in the Omnibus 1.

Note: This article was published on March 18, 2025. Please keep updated on the topic as this is an ongoing process.

Key changes in the Omnibus proposal

The proposal is still undergoing the EU legislative process, but if adopted, the key adjustments include:

Corporate Sustainability Reporting Directive (CSRD)

  • Postponed Deadlines (“Stop the Clock”): Companies originally scheduled to report in 2026 and 2027 (Waves 2 and 3) will see their deadlines postponed by two years, allowing more time for preparation.
  • Narrower Scope: Reporting obligations will now apply only to companies with more than 1,000 employees and either €50 million turnover or a €25 million balance sheet total, reducing the number of in-scope companies by approximately 80%.
  • Streamlined ESRS Reporting: The European Sustainability Reporting Standards (ESRS) will be simplified, reducing the number of required data points and improving consistency across regulations.
  • Voluntary Reporting Standard (VSME): Companies outside of the CSRD scope can opt into a new voluntary sustainability reporting standard, developed by EFRAG, limiting the ESG information that large companies can request from SMEs in their value chains .

Other Regulatory Adjustments

  • Corporate Sustainability Due Diligence Directive (CSDDD): Extended implementation timelines and simplified due diligence obligations for companies.
  • EU Taxonomy: Only companies with more than 1,000 employees and €450 million turnover will be required to report and there will be about 70% reduction of data points to report on. Large companies below this threshold can choose to report voluntarily.
  • Carbon Border Adjustment Mechanism (CBAM): Small importers (<50 tonnes CBAM goods per year) will be exempt from CBAM obligations.
  • InvestEU Regulation: SMEs receiving InvestEU funding will face lower reporting obligations, while the adjustments are expected to unlock €50 billion in investments.

Does ESG reporting still matter?

Despite these regulatory changes, ESG transparency remains a business priority. Banks, insurers, and investors increasingly factor ESG performance into financing decisions, which directly affects a company’s access to capital and creditworthiness. Businesses that maintain robust ESG disclosures are better positioned to secure favorable financing terms and investor confidence.

Beyond financing, ESG transparency provides a competitive advantage. Companies that proactively report their sustainability efforts tend to strengthen brand reputation, investor appeal, and long-term business resilience. In a market where consumers and stakeholders value sustainability, clear ESG reporting helps companies differentiate themselves and attract key partnerships.

Regulatory uncertainty further underscores the need for continued ESG efforts. The Omnibus 1 proposal is still under discussion, and its final form could change before implementation. Many EU countries have already incorporated CSRD into national law, meaning businesses may still be subject to evolving regulations at a local level.

Lastly, delaying ESG initiatives now could lead to higher costs when new regulations come into force. Companies that take a proactive approach to ESG reporting will avoid compliance gaps and be better prepared for future regulatory requirements, ensuring a smoother transition when rules are finalized.

Why Intito ESG Solution remains relevant

In a shifting regulatory landscape, businesses need an ESG reporting solution that is both flexible and future-proof. The Intito ESG Solution enables companies to seamlessly navigate ESG reporting requirements, whether mandated or voluntary, while ensuring compliance, accuracy, and strategic value.

Value beyond compliance:

  • Adaptable to Regulatory Changes: Whether reporting is mandatory or voluntary, our platform ensures businesses can collect, manage, and analyze ESG data efficiently.
  • Investor-Grade ESG Insights: Helps companies maintain high-quality ESG disclosures, crucial for securing investments and loans.

  • Streamlined Sustainability Data Collection: Automates ESG workflows, ensuring businesses are always audit-ready.

  • Competitive Edge: Companies that continue ESG reporting proactively will be better positioned for future regulatory shifts and sustainability-driven markets.

Screenshot of Intito ESG Solution front page

Final thoughts

The Omnibus 1 proposal represents a shift in the EU’s approach to sustainability reporting, reducing compliance burdens for many companies. However, ESG reporting remains a key driver of market credibility, investor trust, and long-term business success. Whether required by law or pursued as a strategic initiative, ESG transparency is here to stay.

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