EU eases sustainability reporting
The EU passed Directive 2026/470 to simplify CSRD and CSDDD reporting—extending deadlines and raising thresholds for mandatory ESG disclosures to reduce the compliance burden on smaller firms. The move still signals tougher, more harmonized global ESG expectations ahead, so cross-border companies will face a patchwork of rising standards. (acerbolivio.com)
Directive (EU) 2026/470 was adopted on 24 February 2026 and published in the Official Journal on 26 February 2026. (eur-lex.europa.eu) (eur-lex.europa.eu) The directive entered into force 20 days after publication, on 18 March 2026. (dlapiper.com) (dlapiper.com) Under the amended CSRD, mandatory reporting applies only to undertakings that cumulatively exceed EUR 450 million net turnover and an average of more than 1,000 employees. (dlapiper.com) (dlapiper.com) Non‑EU undertakings fall in scope only where an EU subsidiary or branch generated more than EUR 200 million net turnover in the preceding financial year and the ultimate third‑country parent generated over EUR 450 million net turnover in the EU for each of the two preceding financial years. (dlapiper.com) (dlapiper.com) EU companies newly in scope will report in 2028 using data from financial years starting on or after 1 January 2027, while non‑EU ultimate parent undertakings have reporting due in 2029 using data from financial years starting on or after 1 January 2028. (dlapiper.com) (dlapiper.com) The CSDDD scope was narrowed so that EU companies are in scope only if they had over EUR 1.5 billion net worldwide turnover and an average of more than 5,000 employees in the last financial year. (dlapiper.com) (dlapiper.com) Member States must transpose the CSRD amendments by 19 March 2027 and the CSDDD changes by 26 July 2028. (bhr.ioe-emp.org) (bhr.ioe-emp.org) The directive removes the planned transition to reasonable assurance, instructs the Commission to adopt limited‑assurance standards by 1 July 2027, and mandates a prompt revision of the ESRS to prioritise quantitative and mandatory datapoints. (generationimpact.global) (generationimpact.global) A new “protected undertaking” concept covers value‑chain partners with up to 1,000 employees, allows reporting firms to rely on supplier self‑declarations of size, and gives those protected undertakings a statutory right to refuse information requests that exceed voluntary SME reporting standards. (generationimpact.global) (generationimpact.global) Member States may grant temporary exemptions for FY2025 and FY2026 for undertakings below the EUR 450 million or 1,000‑employee thresholds, while former Wave‑1 reporters are required to produce NFRD‑ and EU‑Taxonomy‑aligned reports during the transition. (arendt.com) (arendt.com)
