The European Union has launched a major simplification effort with the CSRD reform and the Omnibus Law. This overhaul significantly reduces ESG (Environmental, Social, and Governance) reporting obligations for most companies.
However, this is still just a draft directive. The text must go through the European Parliament and the EU Council before becoming a reality across European countries.
➡ Which companies are still affected?
➡ What are the implications for French businesses?
➡ What is the timeline for concrete implementation?
Let’s break down this reform, which could reshape ESG reporting in Europe.
Who will still be required to conduct ESG reporting under the new CSRD?
Before the reform, the CSRD applied to large companies meeting at least two of the following criteria:
✔ 250 employees
✔ €50 million in turnover
✔ €25 million in total assets
As well as listed SMEs on regulated EU markets.
After the reform:
✔ Only companies with more than 1,000 employees remain subject to ESG reporting, provided they also meet one of the following financial thresholds:
- €50 million in turnover OR
- €25 million in total assets
✔ Listed SMEs will no longer be required to comply with mandatory ESG reporting.
✔ Non-EU companies operating in the EU will now have a higher threshold: €450 million in turnover (compared to €150 million previously).
The consequence? Thousands of mid-sized companies will now be exempt from the regulation.
Fewer requirements, fewer audits: A closer look at the reform
❌ End of sector-specific standards: A single common framework for all companies.
❌ Reduction in mandatory indicators and removal of secondary requirements.
❌ Elimination of in-depth audits: The transition to “reasonable assurance” has been abandoned.
✅ Only direct suppliers will be audited (no more mandatory monitoring of indirect subcontractors).
✅ Removal of mandatory reporting on second- and third-tier suppliers.
✅ No automatic penalties for non-compliance.
SMEs with fewer than 1,000 employees are now exempt from the legal framework, but they won’t be entirely spared:
🔹 Large companies will still require ESG data from their suppliers.
🔹 A “Voluntary Sustainability Reporting Standard” (VSME) has been introduced to allow SMEs to provide information, even without a legal obligation.
What is the timeline for implementation ?
This reform is still just a proposal! It must go through the European legislative process.
1️⃣ Review and adoption by the European Parliament and the EU Council (6 to 12 months)
➡ Amendments may be made. A final vote is expected by the end of 2025.
2️⃣ Transposition into national law (6 to 12 months after European adoption)
➡ France will need to transpose the directive into its legislation, which will take between 6 months to 1 year.
Estimated timeline for implementation in France:
✅ European adoption: End of 2025
✅ Transposition into French law: Throughout 2026
✅ First application: Fiscal year 2027, with reports published in 2028.
This reform represents a strategic turning point for European businesses. It reduces the constraints for the majority of companies. However, it also weakens the EU’s ESG regulatory framework, risking creating a blind spot in environmental and social transparency. The European Parliament and the EU Council could still modify certain measures.