The CSRD Omnibus I simplification project is now complete

Introduction

On 25 November I published a blog post which summarised the legislative impact of the EU Omnibus I Package for the simplification of CSRD.  In that blog post I also described where the legislative process was and what was still outstanding at each strand of the negotiations. Overall, the Omnibus I legislation has now been finalised as follows: 

• The scope of mandatory reporting has been substantially reduced. 
• The ESRS and EU Taxonomy disclosure requirements have been simplified. 
• Digital reporting remains an outstanding implementation challenge. 

This blog post goes into the detail on where we landed with the simplification project, to help you get ready for CSRD implementation. 

The blog post comprises information which is publicly available from EU official publications and EFRAG. 

Revised standards 

On 2 December 2025, EFRAG issued their final technical advice to the European Commission (EC) in the form of the draft simplified European Sustainability Reporting Standards (ESRS). 

On 16 December 2025 the European Parliament (EP) plenary finally approved the amendments to the Corporate Sustainability Reporting Directive (CSRD) and the amendments to the Corporate Sustainability Due Diligence Directive (CS3D).   

This was finalised in February 2026 when the amendments were approved and published on the Official Journal (OJ) of the EU. 

The EC proceeded to publish two consultations. One for their proposed revised ESRSs and one for an updated Voluntary Standard (to replace the existing Voluntary Standard for SMEs – VSME) on 6 May 2026.

The new Voluntary Standard has built on the VSME standard, to create a new standard which can be voluntarily adopted by any undertaking with less than 1,000 employees – the new threshold for CSRD. 

The finalised ESRSs and Voluntary Standard were adopted by the EC on 3 July 2026 and were published on the EU Official Journal on 21 September 2026.. 

Prior to Omnibus I, EFRAG was also working on the technical development of ESRSs for Non-EU Undertakings. Following a short pause during the simplification process, EFRAG resumed this work. On 23 July 2026 EFRAG published the ESRS for Certain Non-EU Undertakings in Accordance with Article 40a of the Accounting Directive consultation (ending 31 October 2026). 

ESRS – datapoints

The revised ESRS reduced mandatory datapoints by over 60% and voluntary datapoints by 100%. The effective reduction of total datapoints in the standards is 70%. 

This was achieved by: 

1. Removing datapoints deemed least important for general purpose sustainability reporting 
2. Prioritising, to the extent possible, quantitative datapoints over narrative text 
3. Further distinguishing between mandatory and voluntary datapoints
4. Providing clear instructions on how to apply the materiality principle to ensure that undertakings are only required to report material information, and reduce the risk of assurance service providers inadvertently encouraging undertakings to report information that is not necessary 
5. Improving consistency with other pieces of EU legislation, and 
6. Taking account of interoperability with global sustainability reporting standards. 

The revised ESRS introduce several changes that go beyond removing datapoints. These affect how companies determine what to report, how much information they need to provide, when certain requirements apply, and how they interpret the standards. 

ESRSs – double materiality 

The double materiality principle remains in place, but its application is more proportionate and less prescriptive. Undertakings have greater flexibility in how they identify and assess material impacts, risks and opportunities (IROs) and there is less emphasis on maintaining exhaustive documentation. 

A more ‘top-down’ approach can me followed to identify obviously material matters, with management’s existing knowledge of the business, without the need for a detailed assessment of every possible sustainability matter. 

Management also has more discretion over the level of aggregation/disaggregation that is required in the report. 

ESRSs – Reporting reliefs and proportionality 

The revised standards introduce greater flexibility where information is particularly difficult or costly to obtain: 

• The preference of primary data directly from value-chain partners has been removed permitting greater use of estimates. 
• An undue cost or effort clause was added to avoid disproportionate information-gather efforts. This also applies to the calculation of complex metrics. 
• Qualitative disclosures can be used in some circumstances to report of financial effects. 
• Certain information can be omitted where disclosure could seriously prejudice a company’s financial position, subject to conditions. 
• Relief are available to reduce the immediate reporting burden associated with newly acquired businesses. 

ESRSs – Structure and understandability 

As also mentioned in our previous Omnibus update, the ESRSs have been restructured to provide shorter and more streamlined standards, with less repetition and overlapping requirements, clearer disclosure objectives, clarified definitions, improved understandability and improved interoperability with other international frameworks.  

EU Taxonomy 

The EU Taxonomy ended up with a reduction of 66% in datapoints for non-financial undertakings and a reduction of 89% for credit institutions. 

Voluntary Standard 

This was based on the VSME standard. It retains its basic and comprehensive modules and continues to provide the reference framework for the value-chain cap. i.e. the amount information CSRD reporters can demand from smaller businesses in their value chains. The standard has been modified to catered for companies with up to 1,000 employees (it was previously designed for companies with up to 250 employees) and it provides a recommended framework for a lot of entities that have found themselves outside the scope of CSRD following the simplification project. 

The Omnibus legislative impact in a table

Thresholds 

Firstly, the substantive changes to the CSRD and CSDDD thresholds, as modified by Omnibus I, remain in effect: 

CSRD: 

This change reduced the scope of CSRD from a population of about 46,000 undertakings to about 4,800. The reduced scope even exempts 6,900 of ‘Wave 1’ undertakings.  Crucially, the CSRD scope is now narrower than its predecessor, the Non-Financial Reporting Directive (NFRD) on which CSRD was intended to build on. 

Third-country undertakings and CSRD thresholds: 

This change reduces the number of third-country undertakings falling within the scope of CSRD from about 10,000 to about 1,200. The majority of these remain in the US (350-450), followed by the UK (150-200). 

The thresholds for CSDDD also changed: 

New reporting timelines 

(for the digitisation timetable see separate section below) 

CSRD 

CSDDD 

Member States must transpose the amended CSDDD by 26 July 2028 and apply the relevant measures from 26 July 2029, with the specified Article 16 measures applying to financial years beginning on or after 1 January 2030. 

Revised ESRSs and Voluntary Standard 

Both frameworks should apply to financial years beginning on or after 1 January 2027. In respect to the ESRSs this means that subsequent waves can adopt the revised ESRSs directly. Wave 1 undertakings which have already implemented CSRD, are likely to have already reported for FY2026 under the original ESRSs. In any case, they do not have to apply the revised ESRSs until periods beginning on or after 1 January 2027. 

Digital Taxonomies 

In August 2026 EFRAG published an updated list of datapoints. On 17 September EFRAG released the Draft ESRS XBRL Taxonomy and launched a public consultation. 

The data points in the draft taxonomy have been reduced in line with the simplification of the ESRSs. The reduction of data points also led to using a flatter narrative tagging hierarchy in the taxonomy, as the previous hierarchy was deemed less useful with the reduced number of tags. The removal of most “whether and how” elements also reduced the number of Boolean (true or false) elements. The labels in the taxonomy where also updated to reflect the updated 2026 list of datapoints.  

EFRAG is still considering whether to include the arcroles (digital relationships between facts) that were included in the 2024 draft taxonomy. They are not included in this current draft. 

EFRAG has decided to only include a small number of disclosure-existence-assertion validations in the revised taxonomy, mainly checking for the existence of EU datapoints (the 2024 version of the Draft taxonomy had a broader set of validations). EFRAG recommends adding further validation rules in the taxonomy after the first wave of companies have digitised their reports. 

Despite the simplification of the EU Taxonomy, EFRAG has not yet been asked by the European Commission to do a similar project to update the EU Taxonomy digital taxonomy (also referred to as the Article 8 digital taxonomy). It is very likely that this will happen in the near future.  

Next steps 

The final digital taxonomies are expected to be provided to ESMA in December 2026. ESMA will then proceed with drafting the revised proposed ESEF Regulatory Technical Standard (RTS) (the original one was published in December 2024) for their implementation. This is expected to be published for consultation at some point in 2027. We expect that ESMA will retain some of the proposals in that original proposed RTS in relation to the changes in the digitisation of financial reporting.  

We are hoping that the simplification of CSRD will be an opportunity to reduce the original complexity of the proposed phased-in approach for implementing the digitisation of sustainability reporting. Given the greatly reduced number of undertakings within scope and the significant reduction in datapoints, a simpler implementation of the digitisation requirements would make a lot more sense. 

CoreFiling

We stand ready to continue to contribute to the CSRD implementation process. Our XBRL solutions cover a range of applications included preparation (Seahorse), audit (Beacon) and data collection (True North).