In November 2024, European Commission President Ursula von der Leyen announced the Omnibus ESG Regulation, a legislative package designed to consolidate and simplify corporate sustainability reporting obligations. By integrating CSRD (CorporateSustainability Reporting Directive), CSDDD (Corporate Sustainability Due Diligence Directive), and the EU Taxonomy Regulation, the Commission aims to cut red tape and ensure consistency while maintaining strong ESG commitments.
Set to be published on February 26, 2025, the Omnibus Regulation seeks to reduce ESG reporting requirements by 25% in its first phase, as outlined in the Budapest Declaration on the New European Competitiveness Deal. Despite fears that this move might weaken sustainability standards, the Commission has reassured stakeholders that the reform is about streamlining compliance rather than rolling back obligations.
Key Objectives of the Omnibus ESG Regulation
The Omnibus ESG Regulation is expected to:
Simplify compliance by merging multiple ESG laws into a single regulatory framework.
Reduce reporting obligations, particularly for SMEs, with a target reduction of up to 35% for small businesses.
Ensure uniformity across the EU by replacing Directives with a Regulation, which is immediately binding across all Member States.
Address global ESG alignment by improving definitions, methodologies, and interoperability with international standards.
Stakeholder Reactions: A Divided Response
Businesses have largely welcomed the regulation as a necessary step toward reducing administrative burdens, but NGOs and sustainability advocates have raised concerns about potential dilution of ESG commitments. The 2024 EU elections shifted the political landscape,and some fear new Parliament debates could weaken sustainability rules.
Despite these concerns, the Commission remains committed to maintaining strong ESG standards while ensuring that businesses remain competitive in the global economy.
How Verimpact Can Help
With evolving regulations, navigating ESG compliance can be challenging. Verimpact assists companies in understanding new regulatory requirements and implementing effective ESG reporting strategies. Through customized compliance solutions, reporting tools, and advisory services, Verimpact helps businesses align with EU standardswhile optimizing sustainability efforts.
What’s Next?
The Commission’s 2025 work program, set for discussion on February11, 2025, will provide further clarity on the next steps. Meanwhile, the EuropeanParliament and Council’s legislative process could lead to adjustmentsin the final provisions.
Businesses should stay informed, prepare for regulatory changes, and leverage expert guidance to ensure compliance with the evolving ESG landscape.
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