On 24 February 2026, the Council of the European Union gave final approval to a package simplifying corporate sustainability reporting and due diligence requirements, as part of the EU’s Omnibus simplification initiative. The reforms cut administrative burdens on companies such as narrowing CSRD reporting scope to larger firms (over 1,000 employees) and limiting indirect “trickle-down” obligations on SMEs, while preserving core EU Green Deal sustainability goals. Due diligence requirements are also simplified, with the first compliance wave delayed until 2029.

The reforms aim to balance sustainability objectives with economic competitiveness by reducing compliance costs and providing companies with more time to prepare. While reporting obligations become more focused on large companies, smaller firms will still be indirectly affected through value chain requirements, meaning sustainability data and carbon footprint information will remain increasingly important for business relationships.