The Omnibus Package
The EU’s Omnibus package aims to reduce the administrative burden related to regulatory compliance that has emerged from the implementation of the CSRD and ESRS. It also proposes simplifications to the EU Taxonomy. In recent years, companies have focused more on how to report sustainability correctly, rather than investing in genuinely more sustainable operations. This has done little to strengthen either competitiveness or sustainability ambitions.
One positive outcome, however, is that companies have become more aware of their actual sustainability capacity, thanks in part to requirements for validated data points. Are we really as sustainable as we think? The new objective is to streamline and harmonize the regulatory frameworks. The proposal must be approved by the EU Parliament and the EU Council before it is implemented in Swedish law.
After all the blood, sweat, and tears, not to mention major investments, everything is now up in the air, and the final outcome remains uncertain. In any case, confusion seems inevitable.
What’s Changing?
A large proportion, estimated at around 80%, of the companies currently subject to CSRD and ESRS will be exempted from the reporting requirement based on the number of employees. The proposed new thresholds for mandatory reporting are companies with more than 1,000 employees, net turnover above EUR 50 million, or total assets exceeding EUR 25 million.
The proposal also removes the requirement for limited sustainability reporting for small and medium-sized listed companies. Under the current directive, these companies are expected to report in a limited scope according to the "ESRS for listed SMEs" (LSME). The proposed amendment means these companies would no longer be subject to the directive and would not have to report in 2026, as originally planned.
Our advice: closely monitor the legislative process, prepare for limited reporting, and comply with existing law until new rules come into force.
For the EU Taxonomy, which was applied starting in 2022 for the two climate objectives and in 2023 for the other four environmental goals, the proposed new threshold is more than 1,000 employees and net turnover above EUR 450 million.
What Does It All Mean?
There is a need to address how smaller companies should report in cases where they are affected by the reporting requirements of larger companies, since they are part of the larger companies’ value chains. The proposal suggests that the European Commission introduce voluntary reporting standards.
What’s clear is that the number of required data points is being reduced, and there is a push for simplification across the board.
Our advice remains: follow current legislation until formal changes are enacted. The proposal is likely to evolve as it moves through the EU legislative process. At present, CSRD has been integrated into Swedish law at a minimum compliance level, no more than what CSRD mandates. Notably, Sweden did not follow the CSRD timeline, meaning large Swedish companies will begin reporting for the 2025 financial year, while companies in other EU countries (with over 500 employees) are already reporting under CSRD for the 2024 financial year.
Many questions remain unanswered. For example:
How should listed companies with more than 500 but fewer than 1,000 employees act this year, given that they are still subject to Swedish annual reporting requirements?
It is still unclear how the proposal will affect Swedish law, and the path forward remains uncertain.
