EU Parliament rejects Omnibus compromise on sustainability reporting and due diligence rules

The European Parliament has voted against a proposal to simplify EU sustainability reporting and due diligence laws, leaving businesses waiting for clarity on what comes next.

Close vote delays progress

In a narrow result, MEPs rejected the compromise agreement on the European Commission’s “Omnibus I” package – designed to streamline sustainability rules and ease administrative burdens – with 309 votes in favour, 318 against, and 34 abstentions.

The outcome means Parliament must go back to the drawing board. MEPs will now revisit the proposal and vote again at the next plenary session on 13 November.

What’s the Omnibus I package?

First introduced in February 2025, Omnibus I forms part of the Commission’s plan to make EU regulations simpler and more consistent. It includes proposed changes to major sustainability laws such as the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD).

One of the most significant suggestions would raise the CSRD reporting threshold from 250 to 1,000 employees – removing around 80% of companies currently covered by the rules. The proposal also limits full due diligence under the CSDDD to direct business partners, reducing demands on smaller suppliers.

Deep political divide

The vote followed weeks of tense debate. Centre-left and green parties argued against major rollbacks, warning that ambitious sustainability rules are essential for accountability. More conservative and far-right groups pushed for wider cuts, citing cost and competitiveness concerns.

A “middle ground” deal led by the centre-right European People’s Party (EPP) sought to bridge the gap. It proposed keeping the CSRD’s 1,000-employee limit but adding a €450 million turnover threshold, and increasing the CSDDD scope to companies with over 5,000 employees and €1.5 billion in revenues. Despite this compromise, the proposal failed in a secret ballot.

What happens next and what businesses should know

The file now goes back to Parliament for further debate. MEPs will vote again on 13 November, before negotiations can begin with the Council of the EU, which agreed its own position in June. Both sides are aiming to reach a final deal by the end of 2025.

For businesses, there are no immediate changes to sustainability reporting or due diligence rules. In short, the EU’s sustainability rulebook is still in flux. The next few months will be crucial in determining whether the reporting and due diligence frameworks are simplified – or remain largely unchanged.

We’re keeping an eye on changes to CSRD / CDDD and will update the Energy Advice Hub as they happen. In the meantime, if you’re in scope of EU sustainability regulations and would like advice, get in touch with Sustainable Energy First.