On July 3, 2026, the European Commission adopted revised European Sustainability Reporting Standards (ESRS) and a voluntary reporting standard for smaller companies. The revised standards reduce mandatory datapoints by over 60% (from approximately 1,100 to roughly 430) and total datapoints by over 70%, with expected reporting cost reductions of more than 30% per company. The standards introduce a 'value chain cap' limiting information requests from CSRD companies to SMEs with 1,000 or fewer employees. The delegated acts are now under scrutiny by the European Parliament and Council (2-month period, extendable by 2 months) before entering into force. Companies should prepare to apply the simplified standards for FY 2027 reporting.
The European Commission adopted Commission Delegated Regulation C(2026) 5011 establishing a voluntary sustainability reporting standard for undertakings not subject to mandatory CSRD requirements. The voluntary standard provides a simplified and standardized framework for undertakings with fewer than 1,000 employees that are protected under the Omnibus I value chain cap, enabling them to report sustainability information voluntarily and access sustainable financing. It includes a Basic Module covering general information, environment, and social metrics, and a Comprehensive Module with additional disclosures for larger undertakings. The standard also defines the information that reporting undertakings may request from value chain partners under the value chain cap provisions.
The European Commission adopted revised European Sustainability Reporting Standards (ESRS) on 3 July 2026 with significant simplifications. Mandatory data points have been reduced by over 60% (from approximately 1,100 to 430). Key changes include a new 'top-down' materiality assessment approach, greater flexibility for value chain reporting including use of proxies and estimates, prohibition on reporting non-material information, phase-in periods for financial effects disclosures, and alignment with global standards for GHG emissions reporting boundaries. The revised standards apply to financial years beginning on or after 1 January 2027, with early adoption permitted for FY2026.
The European Commission has opened a public consultation seeking feedback on draft revised European Sustainability Reporting Standards (ESRS). The revised standards reduce mandatory datapoints by over 60% (from approximately 1,100 to 430) and total datapoints by over 70%. Key changes include simplified materiality assessment requirements, new flexibilities for companies, and clearer, shorter standards. The Commission expects over 30% reduction in reporting costs per company. Public feedback is open until 3 June 2026.
The European Commission published additional explanatory information clarifying how the value chain cap under Omnibus I Directive (EU) 2026/470 should be applied. The guidance confirms that reporting undertakings subject to CSRD should only request information from value chain undertakings to the extent necessary, and specifically should request less information than specified in the voluntary reporting standard if they do not need all the information. Recital 12 of Omnibus I establishes that companies with ≤1,000 employees in the value chain should not be asked to provide more sustainability data than what is covered by the voluntary reporting standard for smaller companies. This guidance helps companies understand proportionality requirements when requesting sustainability data from smaller value chain partners.
On 6 May 2026, the European Commission launched a ‘Have Your Say’ feedback period on (1) draft revised European Sustainability Reporting Standards (ESRS) under CSRD and (2) a draft sustainability reporting standard for voluntary use (intended for companies outside mandatory CSRD scope). The consultation is positioned as part of CSRD/Omnibus simplification, including operationalising the ‘value chain cap’ concept that limits what in-scope CSRD companies can require from smaller value-chain partners. Compliance teams should monitor and, where relevant, submit feedback, because the delegated acts would materially change ESRS datapoints and introduce a Commission-level voluntary standard that may become the ceiling for supplier data requests under the value chain cap mechanism.
On 6 May 2026, the European Commission published additional explanatory information (Q&A) clarifying how the CSRD ‘value chain cap’ is intended to function. The Q&A explains that CSRD in-scope companies cannot require value-chain partners with ≤1,000 employees to provide more sustainability information for CSRD purposes than what would be allowed under the Commission’s voluntary sustainability reporting standard (to be adopted via delegated act). This guidance is operationally important for supplier due diligence and data-request governance, as it frames what information can be demanded from smaller suppliers/partners and how to handle requests that exceed the cap.
On 6 May 2026, the European Commission launched a Have-Your-Say feedback process on draft final versions of (1) revised European Sustainability Reporting Standards (ESRS) under CSRD and (2) a sustainability reporting standard for voluntary use, intended in part to operationalize the CSRD “value chain cap” (limiting information requests from value-chain partners with ≤1,000 employees). Compliance teams should monitor and consider submitting feedback because the revised ESRS could materially change future required datapoints and reduce reporting burden, and the voluntary standard may become the reference point for supplier data requests and value-chain information collection expectations once adopted via delegated acts.
The European Commission published additional explanatory information in a Q&A format clarifying the value chain cap provisions introduced by the Omnibus I Directive. Under these provisions, companies with 1,000 or fewer employees can refuse to provide sustainability information beyond what is specified in voluntary standards (VSME). This guidance helps companies understand their rights and obligations regarding value chain sustainability information requests from larger CSRD-reporting companies. The value chain cap is a key simplification measure designed to reduce administrative burden on smaller companies in the supply chains of CSRD-reporting entities.
The European Commission launched a public consultation from May 6 to June 3, 2026 seeking feedback on revised European Sustainability Reporting Standards (ESRS). The proposed revisions reduce mandatory datapoints by over 60% (from ~1,100 to ~430), with total datapoints reduced by over 70%. Reporting costs are expected to decrease by over 30% per company. The revised standards feature shorter, clearer language with new flexibilities, a simplified materiality assessment process, and enhanced fair presentation framework. The consultation covers both the revised mandatory ESRS for in-scope companies and voluntary standards for SMEs (VSME). The Commission plans to adopt the Delegated Act on revised ESRS before summer 2026.
The Platform on Sustainable Finance, the Commission's expert advisory body, published its formal response to the Commission's consultation on revised European Sustainability Reporting Standards (ESRS). The advice was submitted on March 18, 2026 in the context of the Omnibus I package amendments to CSRD. The Commission committed to adopt a Delegated Act to revise the first set of ESRS based on EFRAG's technical advice provided on December 3, 2025, and taking into consideration the Platform's input. The Commission plans to adopt the revised ESRS Delegated Act before summer 2026.
EUR-Lex listings for Directive (EU) 2022/2464 (CSRD) indicate the act "has been changed" and that a "current consolidated version" exists dated 18/03/2026. This signals that CSRD has been amended and the consolidated text has been updated accordingly; compliance teams should consult the consolidated text and the specific amending act(s) to confirm any revised obligations, scope, and dates reflected as of that consolidation date.
Directive (EU) 2026/470 significantly raises CSRD mandatory reporting thresholds to companies with more than 1,000 employees AND net turnover exceeding €450 million (previously 250 employees and €50 million for large undertakings). This reduces CSRD scope by approximately 80%, exempting many mid-sized companies from mandatory sustainability reporting. Financial holding undertakings may now choose whether to report consolidated sustainability information. Member States have until March 2027 to transpose amendments.
Directive (EU) 2026/470 (Omnibus I) significantly raises CSRD reporting thresholds. EU companies must now have >1,000 employees AND >€450M net turnover to be in scope (previously >250 employees AND €50M turnover). Non-EU company threshold raised to €450M turnover generated in the EU. Sector-specific sustainability reporting standards are now voluntary rather than mandatory. The directive introduces a value chain cap protecting companies with ≤1,000 employees from excessive information requests, limits assurance to 'limited assurance' only (removing pathway to reasonable assurance), and mandates creation of a digital reporting portal. Member States must transpose provisions by March 19, 2027.
Directive (EU) 2026/470 (24 Feb 2026) was published in the Official Journal on 26 Feb 2026 and is indicated as in force on EUR-Lex. It amends Directive (EU) 2022/2464 (CSRD) and related corporate reporting/audit legislation (including Directive 2013/34/EU and Directive 2006/43/EC) as regards certain corporate sustainability reporting requirements. Compliance teams should review the amended CSRD-related provisions and plan for Member State transposition/implementation, as this is a binding legislative change that can affect applicability scope, reporting obligations, and assurance-related mechanics within the CSRD framework.
ESMA issued an opinion dated 17 February 2026 on EFRAG’s technical advice regarding revised European Sustainability Reporting Standards (ESRS) used for CSRD sustainability reporting. While not itself a binding change to CSRD/ESRS requirements, this official supervisory authority opinion is relevant for compliance planning because it provides ESMA’s views on the direction and appropriateness of proposed ESRS revisions and relief mechanisms that may later be implemented via Commission delegated acts.
ESMA published/updated a ‘Sustainable Finance’ implementation timeline document (last updated 13 January 2026) that includes CSRD-related timing references. This document functions as operational guidance/coordination material for stakeholders tracking CSRD milestones and should be used as a reference aid (while the underlying legal acts remain controlling).
ESMA published a public statement setting out European Common Enforcement Priorities for 2025 corporate reporting. This statement is relevant to CSRD because it signals supervisory focus areas for corporate reporting and can influence how CSRD/ESRS sustainability statements are reviewed/enforced by national competent authorities. Compliance teams should consider these priorities when preparing CSRD-aligned disclosures and documentation supporting reported information.
The European Commission adopted a Recommendation establishing a voluntary sustainability reporting standard for small and medium-sized enterprises (VSME). The standard is based on EFRAG's VSME standard delivered in December 2024. It includes a 'value chain cap' provision that protects companies with up to 1,000 employees from excessive sustainability information requests from companies subject to mandatory CSRD reporting. The standard will serve as the basis for a future delegated act under the CSRD for voluntary reporting by SMEs.
EFRAG published revised and simplified Exposure Drafts of the European Sustainability Reporting Standards (ESRS) for a 60-day public consultation from 29 July 2025 until 29 September 2025. The consultation sought stakeholder feedback on proposed simplifications including shortened and clarified standard text, additional flexibility measures to alleviate reporting burden, and alignment with the Omnibus I Directive changes. This consultation informed the Commission's final adoption of revised ESRS in July 2026.