EU releases Omnibus proposals

What you need to know
What you should do next
Key questions to ask
We are here to help

The European Commission recently introduced an omnibus package of proposals aimed at simplifying sustainability reporting and due diligence obligations.

The EU ESG reporting framework is bold making it challenging for companies to prepare. The European Commission is proposing to refine regulations to be more pragmatic and more focused on the ultimate reporting goal: Achieve Green transformation as discussed in the EU Green Deal.

The omnibus legislation aims to foster a more favorable business environment, reduce regulatory burdens, and help companies transition to a sustainable economy, aligning with the EU's Green Deal objectives. This initiative is part of a broader effort to enhance the EU's competitiveness by reducing reporting burdens without undermining policy objectives. KPMG firms stand ready to assist clients through their sustainability reporting journey and will advise to find the right reporting strategy.

We recognize that regulatory shifts can shake up your business as usual. To help support you, below you will find a curated a collection of resources, recommendations, and actionable steps to guide you through your sustainability strategy—no matter where you are in the process.

What you need to know

April 2025 update: A two-year postponement in mandatory reporting under ESRS and EU Taxonomy for second- and third-wave companies and a 1 year postponement for first-wave companies under CSDDD has been agreed by the EU under the proposed ‘Stop the clock’ directive. The directive is pending final adoption to EU law, after which it will be transposed into national law. The deadline for the transposition is 31 December 2025.

Additionally, the Commission has mandated EFRAG to provide advice on how to simplify ESRS by 31 October 2025.

This article was published on 27 February 2025 and updated on 3 April 2025 to reflect these changes.

Watch the replay

Watch this webcast which aims to break down the VSME standard and explore an investor and B2B-driven approach to ESG reporting.

Key discussion topics:

VSME: Investor- & B2B-driven ESG Reporting
Understanding VSME
Comparison to ESRS
How to do voluntary ESG reporting best tailored to requirements by investors and B2B – including and beyond VSME

Watch the replay

Watch this webcast which aims to break down the first Omnibus proposal and explore what it means for your company.

Key discussion topics:

Analysis of the first Omnibus proposal: Overview of planned changes to CSRD, CSDDD (Corporate Sustainability Reporting Directive; Corporate Sustainability Due Diligence Directive) and the EU Taxonomy
Implications for your company: Practical implications for your reporting requirements

Watch the replay

Preparing for the EU Omnibus: Practical advice for non-EU-based companies

Watch this webcast which aims to:

provide a recap on what the EU Omnibus Initiative is - with focus on the CSRD proposals
Explores what the practical challenges are for non-EU-based organizations
What are the 'no regret' activities you should be considering?
What next steps should you be taking?

Who is now in scope?

The in scope businesses for CSDDD have not changed, only the implementation date for first-wave companies. Under the proposals, only large companies with more than 1,000 employees would be in scope of the CSRD and therefore required to report under ESRS. The EU Commission estimates this would decrease the number of companies in scope by approximately 80 percent. Further, under a so-called 'Stop the clock' proposal, mandatory ESRS reporting for second- and third-wave companies would be postponed for two years.

Depending which of these wave you currently sit in we are suggesting the following course of action:

Curated content

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Despite the uncertainties introduced by the Omnibus, most will not stop their ESRS implementation. Read the survey results from over 120 companies across 18 countries and 13 sectors.

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Q1 2025 marked the release of the first wave of sustainability statements prepared under ESRS, coinciding with the European Commission’s release of its first set of Omnibus proposals.

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A webcast series dedicated to helping leaders stay connected on top-of-mind ESG issues.

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Limiting ESRS and EU Taxonomy requirements to the largest companies.

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Global sustainability reporting is here – It’s time to get ready.

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Reducing the reporting burden for companies.

What you should do next

If you haven't started on CSDDD yet

Now is the time to take a structured first step by mapping the ‘chain of activities’ and identifying and assessing risks specifically link to your tier 1 business partners. Establishing a basic due diligence framework aligned with the evolving CSDDD requirements will help you manage upcoming obligations more efficiently—and demonstrate proactive risk management to stakeholders and regulators alike.

For most companies who have completed a Double materiality assessment (DMA)

A key step will be developing a pragmatic climate transition plan using the Transition Plan Taskforce (TPT) framework. This approach helps you prioritize areas within your control and influence, while acknowledging that some factors are beyond your reach, so they shouldn’t consume undue management time or resources.

For companies who have not completed a DMA

A key step will be to prioritize a financial materiality exercise. This strategic exercise can uncover risks and opportunities that CSOs and CFOs may want to know about and address.

Data challenges aren’t disappearing

For those data points you identified as financially material, and ultimately you want to embed in to your management thinking —use the Omnibus package outcomes to focus on resolving issues with the data that truly matters. This can help strengthen your strategic decision-making and can optimize cost.

Sustainability technology tools have advanced significantly in the past year. With the extra time potentially available, assess which technology solutions suit your needs best. Start conversations with your CIO and CFO to align on this.

Look for opportunities

With the potential extra time or resource that may be freed up, explore how you can redeploy or refocus to drive value-adding Decarbonization or strategic sustainability initiatives.

Key questions to ask

For CSO/Head of Sustainability

Beyond ESRS, what are the core data points you still need to help run your business?

Will this Omnibus proposal potentially free up capacity or resource in the short or medium term?

How do you redeploy capacity in support of driving your transition initiatives?
For CEO

Going beyond reporting, where can sustainability drive a competitive advantage?

How can we focus sustainability actions on performance improvement add value creating activity?
For CFO

Where does sustainability fit into your wider reporting strategy?

Are any of your financial commitments or investor narrative tied to sustainability data or reporting?

Were you reliant on sustainability reporting to manage material financial and business risk?
For CIO

For your sustainability data points, where in the business is that data coming from and who manages it?

What tools & system architecture is needed to ensure you drive value from your sustainability data?