Nexio Projects outlines the implications of Omnibus for ESG reporting

The introduction of the Omnibus simplification package has reshaped several areas of CSRD compliance, including scope, timelines and reporting expectations. Dora Cristian, Principal Consultant at Nexio Projects, walks through the changes and its key implications.

While the Omnibus has narrowed CSRD scope and adjusted the CSRD timeline, it has not removed the underlying regulatory and stakeholder pressure for high‑quality ESG and CSRD reporting.

Instead, it has created a clearer differentiation between organisations in scope of CSRD and those that will move towards voluntary standards such as VSME (Voluntary Sustainability Reporting Standard for SMEs) or the soon-to-be developed voluntary standards for non-CSRD companies, and Global Reporting Initiative (GRI).

Four parallel legislative tracks
The Omnibus package has evolved since the initial CSRD adoption in 2021. Four parallel legislative tracks:

• Omnibus I (“Stop the clock” directive): Paused CSRD application for waves 2 and 3, providing time to address contentious issues such as CSRD scope and reporting content.
• Omnibus content proposal: Introduced new thresholds and exemptions for both CSRD and CSDDD, clarifying which organisations are mandated to publish a CSRD report.
• Revised ESRS: Exposure drafts from EFRAG aim to simplify disclosures, including a reduction of around 60% in data points and confirmation that assurance remains at a limited level for now.
• EU Taxonomy delegated act: Adjusted to align scope and application with CSRD changes, introduced financial materiality thresholds for non‑material economic activities, and simplified DNSH criteria.

Updated thresholds and CSRD scope
A key outcome of the Omnibus is the substantial increase in CSRD reporting thresholds.

For the CSRD:

• EU undertakings: CSRD now applies to entities exceeding 1,000 employees and EUR 450 million net turnover, assessed both at entity level and on a consolidated basis for EU parent undertakings.
• Non‑EU undertakings with significant EU presence: Where a third‑country parent generates at least EUR 450 million EU turnover for two consecutive years and at least one EU subsidiary or branch individually exceeds EUR 200 million turnover.

For the CSDDD:

• Thresholds increased to 5,000 employees and EUR 1.5 billion turnover, clearly targeting very large groups.

CSRD scope, exemptions and consolidation

Key interpretational items: Employees and turnover
Interpreting CSRD scope is less straightforward than the headline thresholds suggest. The employee criterion is defined as the average number of employees during the financial year, calculated on a full‑time equivalent (FTE) basis. This raises practical questions around temporary workers, contractors and part‑time staff.

Companies often struggle to calculate this consistently across Member States, particularly where national rules differ. Organisations are advised to reconcile definitions with the EU Accounting Directive and their financial statements. Similarly, net turnover must be carefully consolidated to determine whether thresholds are met at entity and group level.

Omnibus reporting exemptions
Two new exemptions introduced by the Omnibus play an important role in CSRD scope and consolidation:

• Group composition changes: Parent undertakings may omit specific information where the group has changed significantly due to mergers, acquisitions or divestments, provided they disclose the events and their impact on impacts, risks and opportunities (IROs).
• Financial holding undertakings:  with subsidiaries having business models and operations independent from one another and whose sole purpose is to hold investments may choose not to report.  

Both exemptions require transparent disclosure and do not remove the need to fully understand CSRD scope across the corporate structure.

Consolidation scenarios and CSRD implications

To shed light on the implications, experts at Nexio Projects have gone through practical case-by-case examples and scenarios to illustrate the complexities of determining CSRD applicability under three different scenarios:

• EU-based holdings with cross-border consolidation 
• Non-EU holdings with significant EU presence and how consolidation might look like for large non-EU groups. 
• Financial holding structures and exemptions in a real-life situation

How businesses should respond: In scope and beyond

CSRD journey for in‑scope companies
For organisations in scope of CSRD ESRS, a staged implementation journey aligned with the revised timeline is essential:

• By 2026: Completion or update of double materiality assessments, ESRS gap analyses, and initial climate transition and decarbonisation plans.
• Foundations: Policies, actions, targets and metrics (PATM), EU Taxonomy eligibility assessments, and climate risk analyses where ESRS E1 is material.

From financial year 2027, systems and tools must be ready for CSRD data collection, with reporting in 2028 subject to limited assurance and digital tagging.

ESG strategy for companies outside CSRD scope
For organisations not in scope, the focus shifts from compliance to strategic ESG positioning. Double materiality assessments remain highly valuable for ESG strategy, even without mandatory CSRD reporting.

Recommended actions include:

• Mapping regulatory preparedness and stakeholder expectations
• Conducting a benchmarking exercise to define a minimum compliance baseline and ESG ambition
• Considering voluntary reporting aligned with VSME or GRI
• Developing a clear ESG roadmap linked to impact and investment

Conclusion

The Omnibus package narrows the scope and delays timelines of CSRD, but reinforces the need for high-quality ESG reporting by clearly separating companies subject to mandatory requirements from those expected to adopt voluntary standards like VSME or GRI.

As a result, organisations must either prepare for structured CSRD compliance or proactively define their own ESG strategy, as regulatory and stakeholder expectations around transparency and sustainability performance remain firmly in place.