The European Parliament has voted in favour of delaying two major sustainability rules: the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD/CS3D). These rules were designed to improve transparency and accountability in corporate sustainability practices. However, they will now be postponed, giving businesses more time to comply.
Why the delay?
The European Commission proposed changes to reduce the regulatory burden on businesses during economic uncertainty. The aim is to cut reporting obligations by 25% for large private firms and 35% for small and medium-sized enterprises (SMEs).
As part of this effort, the Commission introduced an ‘Omnibus’ package, which includes:
- Delaying the implementation of CSRD and CSDDD
- Reducing the number of businesses affected
- Scaling back the level of required disclosures
Critics argue these changes go beyond simplification and could weaken sustainability regulations.
What was decided?
On 1 April 2025, MEPs held a key vote on the Omnibus package. They supported an urgent ‘stop the clock’ proposal, which gives companies extra time to comply. This means:
- Companies that were due to start reporting under CSRD in 2026 or 2027 will now have until 2028.
- EU member states will have an extra year to incorporate CSDDD into their national laws.
Supporters say this will help businesses grow and stay competitive. MEP Tomos Tobe argued that firms need “clarity and breathing room” to innovate. He warned that European businesses risk falling behind if regulations are too strict.
However, not everyone agrees. French MEP Manon Aubry called the delay a “scandal”, saying it prioritises corporate lobbying over urgent social and environmental issues. She criticised the move for weakening protections against harmful business practices.
What happens next?
Another vote will take place on 3 April. If the European Parliament approves the delay, the Council of the EU will need to give final approval before the changes come into effect.
What does this mean for businesses?
For companies preparing for CSRD and CSDDD, this delay offers extra time to meet the new requirements. However, businesses should still prepare, as sustainability reporting and due diligence will eventually become mandatory.
We will continue to monitor developments and update you on what these changes mean for UK businesses.
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