CSRD and CS3D: What's Changing with the Omnibus Package

On October 12, 2025, the European Parliament's Legal Affairs Committee adopted the compromise text of the Omnibus package, reshaping the architecture of the CSRD and CS3D directives. This major revision, driven by a stated objective of simplification and reduction of administrative burden, is reshuffling the cards of sustainability reporting in Europe.

A radical change of scale

The most spectacular change concerns the application thresholds. For CSRD, they rise to more than 1,000 employees and €450 million in turnover, compared to 250 employees or €40 million previously. Result: between 80% and 90% of initially concerned companies are excluded from the scheme. CS3D follows the same logic with an increase to 5,000 employees and €1.5 billion in turnover, excluding 70% of targeted companies.

Beyond the thresholds, the entire philosophy of the framework is evolving. Climate transition plans, previously mandatory, become optional. Sector-specific ESRS standards are removed, except for a simplified version for SMEs on a voluntary basis. The value chain, which was to be scrutinized in its entirety, is now limited to tier-1 suppliers. As for the harmonized civil liability provided by CS3D, it is abandoned in favor of a national approach.

Opportunities despite uncertainty

The generalized two-year postponement of implementation deadlines offers welcome relief. Large non-listed companies and listed SMEs now have strategic time to structure their internal processes, train their teams, select the right tools, and test their reporting systems. This breathing room helps avoid rushed investments and compliance errors.

But this reprieve comes with new areas of uncertainty. Ambiguity about the final scope and the simplified version of ESRS standards complicates budget planning. There's also a risk of wait-and-see attitudes: some companies might be tempted to postpone everything, creating a bottleneck as the new deadline approaches.

A fragmentation that raises questions

While the principle of double materiality remains at the heart of the framework for large companies, the reform creates a multi-speed Europe. Large listed companies, already engaged in CSRD with no possibility of postponement, will continue their reporting according to ESRS "Set 1" standards, while others will slow their pace. This heterogeneity risks complicating the readability and comparability of sustainability reports at European level.

The limitation of reporting to the direct value chain also raises questions. By abandoning an extended vision of impacts, Europe is slowing the diffusion of high standards throughout the economic ecosystem.

The timeline ahead

The new implementation calendar is confirmed: large non-listed companies will postpone their first reporting to 2028, and listed SMEs to 2029. But the legislative process is not finished.

The text must first be voted on in plenary session of the European Parliament between October 20 and 23, before entering the trilogue phase with the EU Council and the Commission. Final validation by the Council will follow. In parallel, the Commission will adopt delegated acts by the end of 2025 or early 2026 to finalize the simplification of ESRS standards, while EFRAG must deliver a technical report before the end of November 2025.

The national transposition of CS3D is also postponed to July 26, 2027. Negotiation points to watch closely include final thresholds, civil liability, and sanction mechanisms.

This Omnibus package marks a retreat from the initial ambition of a systemic transformation led by Europe. The simplification responds to criticisms about the complexity of the regulatory framework, but it raises questions about the Union's ability to maintain its leadership in sustainability matters.

For companies, the message is clear: the postponement is not an invitation to inaction, but an opportunity to better prepare for a transformation that remains inevitable. Those who know how to use this time to anticipate and structure their approaches will gain an advantage, while others risk being caught off guard when compliance time comes.