European Parliament votes to postpone EU directives on corporate sustainability due diligence and sustainability reporting

On Thursday, the European Parliament voted to postpone the implementation dates for corporate sustainability due diligence (CSDDD) and reporting requirements (CSRD). This is the first step in the European Commission’s Omnibus package which Setterwalls has previously reported on here.

The new corporate sustainability due diligence rules, aimed at reducing companies’ negative impacts on people and the planet, will now be transposed into national legislation by 26 July 2027, giving companies an extra year to become compliant. The first wave of affected businesses, including EU companies with over 5,000 employees and net turnover higher than €1.5 billion, and non-EU companies with EU turnover above this threshold, will start applying the rules in 2028. The same timeline applies to the second wave of companies with over 3,000 employees and net turnover higher than €900 million, and non-EU companies with turnover above the same threshold in the EU.

Additionally, the corporate sustainability reporting directive’s application will be delayed by two years for the second and third waves of companies. Large companies as defined in CSRD with more than 250 employees will begin reporting in 2028, while listed small and medium-sized enterprises will follow in 2029.

The European Commission introduced the ”Omnibus I” simplification package on 26 February 2025, which includes the directive today endorsed by the Parliament. The package also proposes changes to the content and scope of sustainability reporting and due diligence requirements, with further work to commence in the Parliament’s Legal Affairs Committee.

The draft law now awaits formal approval by the Council, which has already endorsed the text on 26 March 2025.

Setterwalls will closely monitor the legislative process, including national implementation, and are available to assist with any questions regarding the proposal or legislation.