What's the Fuss About Omnibus?

Feb 11

3 min read

The EU’s Omnibus proposal is shaking up sustainability reporting. It promises to simplify compliance, but is it a step forward or a setback?

Some welcome the reduced reporting burden, while others worry it could weaken corporate transparency and sustainability efforts.

What is Omnibus, and what are the latest developments? Let’s dive in.

EU's Omnibus proposal sparks debate

The European Union's Omnibus proposal aims to simplify sustainability reporting standards, reducing compliance burdens while maintaining transparency and accountability.

However, the proposal has sparked a heated debate. Some welcome the relief for SMEs, while others warn that the proposal could undermine the EU’s sustainability ambitions.

What is Omnibus and what do we know so far?

What is the Omnibus simplification package?

An omnibus is an instrument to change multiple laws with a single piece of new legislation.

In November 2024, the President of the European Commission, Ursula von der Leyen announced the Omnibus plans as part of efforts to streamline sustainability regulations. The European Commission is expected to unveil the Omnibus proposal on February 26th, though delays are rumored.

What is the goal of Omnibus?

The proposal aims to ease compliance burdens by consolidating three key sustainability regulations - part of the EU’s Green Deal. President Ursula von der Leyen emphasized that Omnibus aims to simplify implementation, not weaken the laws themselves.

The Omnibus sustainability package will simplify the following three key regulations:

Sustainability Regulation	Requirement for in-scope companies
Corporate Sustainability Reporting Directive (CSRD)	Report on sustainability impacts, risks, opportunities, and management strategies.
Corporate Sustainability Due Diligence Directive (CSDDD/CS3D)	Identify and address adverse human rights and environmental impacts in their operations and value chains
EU Taxonomy Regulation	Establishes a classification system to determine whether an economic activity is environmentally sustainable, guiding investments towards sustainable growth.

What do we know so far?

The EU Competitive Compass addresses the EU’s competitiveness gap. This is a response to the Draghi report which identified an $825 billion funding gap for Europe's industrial decarbonization and competitiveness.

The “Simpler and Faster Europe” Communication sets out the new course to simplify EU rules, with five Omnibus proposals foreseen in 2025. The package aims to reduce administrative burdens by >25% for firms and >35% for SMEs.

Speculations about the content

Responsible Investor expects the Commission to heavily water down CSRD and CSDDD:

Possible Delay: Publication may be pushed to March instead of February 26th.
Scope Reduction: Companies with <1,000 employees may be excluded, removing 85% from CSRD reporting.
Double Materiality at Risk: Refocus on (financial materiality) to align CSRD with the International Sustainability Standards Board (ISSB) framework.
SME Reporting Cut: New "small mid-caps" definition may reduce SME obligations by 35%.
Compliance Delays: Deadlines could be extended by 1-2 years.
CSDDD Revisions: 11 key provisions, including climate plans and corporate liability, are under review, potentially weakening commitments.

Timeline of latest developments

What next?

Until the Omnibus proposal is revealed in February (or March), no further consultations are expected.
The package will bring more clarity, but if it takes the form of a formal legislative proposal, the European Parliament and Council will review it, potentially making substantial amendments.
Many Member States have already adopted national laws transposing existing EU directives, though how national legislatures proceed remains uncertain.
Companies are preparing for the implementation of current EU directives, with some coming into effect as early as 2025.

Recommendation

Prepare for as-is reporting but be ready for changes. The impact is still uncertain. Focus on mitigating strategies and maintain flexibility to adapt to the evolving legislative landscape.

What’s your take on Omnibus?

Will Omnibus strike the right balance between efficiency and accountability, or is it a step back for ESG? Share your thoughts below or reach out if you need help with sustainability reporting — I’d love to assist!