CSRD, Omnibus Package: Positions from 14 Member States

On 26 February 2025, the European Commission published its proposal for the so-called Omnibus Package, aimed at simplifying and consolidating the reporting obligations under the CSRD, CSDDD and SFDR. An overview of the proposed changes is available in a previous blog post.

One month later, on 27 March, the European Financial Reporting Advisory Group (EFRAG) was once again tasked with simplifying the European Sustainability Reporting Standards (ESRS). EFRAG subsequently launched a public consultation. Initial responses from 14 Member States (BE, BG, CZ, DE, EE, ES, IT, LV, LU, NL, PT, SK, FI, SE) are now available on this link: responses from Member States CSRD and CSDDD

Overall, the Member States have welcomed the proposals set out in the Omnibus Package. However, their demands and concerns mainly focus on three key issues: 

1. Thresholds for companies subject to reporting obligations 
2. Materiality and scope of reporting requirements 
3. The binding nature of the CSDDD 

We have summarised the key positions of each Member State on these topics below. 

1. Raising thresholds for reporting obligations

In the current debate around expanding reporting obligations under the CSRD, a clear trend is emerging: most Member States, including Bulgaria, Germany, Czech Republic, Spain and Sweden, advocate for raising the thresholds to at least 1,000 employees and €450 million in net turnover. This would limit comprehensive reporting obligations to large companies. 

The Netherlands and Finland support raising thresholds but do not want to introduce rigid limits. Belgium raises formal concerns, particularly regarding the definition of “average” headcount. 

Italy proposes that companies with 500 to 1,000 employees and revenues between €50 million and €450 million should report, but under simplified ESRS requirements. 

Other countries, such as Estonia, Luxembourg, Latvia, Portugal and Slovakia, have not yet taken a clear position. 

2. Materiality and scope of reporting obligations

Many Member States are calling for greater clarity on which sustainability disclosures are truly relevant and mandatory, and for more quantifiable data. 

Germany advocates for a recital allowing companies to protect business secrets (e.g. IP, know-how, innovations). The Netherlands calls for close alignment between CSRD and ESRS so that materiality and disclosure obligations are better coordinated, while Belgium demands precise definitions – such as of “financial year” – to prevent legal uncertainty. Bulgaria warns against excessive administrative burdens, particularly for companies with 500–1,000 employees, and calls for proportionate obligations. 

The Czech Republic proposes a “safe harbour” for supply chain data to shield smaller suppliers from disproportionate requirements. Spain supports a tiered approach to reporting obligations based on company size, with a focus on KPI-based metrics. Finland advocates a risk-based materiality model, and Italy suggests a maximum of 40 simplified data points, focusing on Tier 1 suppliers. 

Several countries, including Estonia, Luxembourg, Latvia, Portugal and Slovakia, have not yet made explicit statements on this issue. 

These diverging proposals highlight the challenge of balancing transparency and practicality. What’s clear is that future reporting standards must be both legally sound and workable in practice. 

3. CSDDD – Mandatory or Voluntary?

The debate around the Corporate Sustainability Due Diligence Directive (CSDDD) centres on whether it should be mandatory or voluntary. 

While Estonia favours a voluntary approach, citing existing corporate sustainability initiatives, most other countries support a mandatory yet pragmatic regime. Bulgaria endorses the core goals of the CSDDD but calls for proportionate implementation—focusing on direct Tier 1 suppliers and extending responsibilities to deeper supply chain levels only when “reasonable indications” of risks exist. 

Germany shares the human rights and environmental aims but demands clear rules on liability, scope and transition periods, while also insisting on retaining civil liability rights under Art. 29(1) to ensure access to legal remedy for affected parties. However, Germany’s new chancellor has expressed support for repealing the national supply chain law. 

The Netherlands supports a mandatory, risk-based approach in line with OECD and UN principles, avoiding a narrow focus on Tier 1 suppliers to ensure both effectiveness and proportionality. 

Some states (e.g. Belgium) remain undecided and request further discussion, while others—such as the Czech Republic, Spain and Finland—call primarily for clear and practical rules. Luxembourg, Latvia, Portugal, Sweden and Slovakia have yet to take a position. 

Less Reporting, More Impact? The Trade-offs in the Omnibus Debate

Increasing the CSRD thresholds is likely to limit reporting obligations to larger companies, which could reduce the amount of data available for assessing sustainability across the economy. If the Paris Agreement’s goal is to channel capital into sustainable activities, this development raises the question of how smaller companies will benefit from such investment if their sustainability contributions are no longer measured. 

In the financial sector, there is broad consensus: without reliable data, sustainability efforts cannot be made transparent or comparable. The move to reduce the number of data points is generally welcome, provided that the remaining requirements across SFDR, CSRD, CSDDD and the EU Taxonomy are fully aligned. 

We also support the proposal to introduce simplified standards, such as the Voluntary Sustainability Reporting Standard for non-listed SMEs (VSME). This standard should still include key sustainability indicators to ensure credibility and comparability, and enable smaller companies to benefit from sustainability-linked investment. 

The three critical issues mentioned above will continue to be debated at all political levels. It remains to be seen what reporting standards will ultimately be adopted and to which companies they will apply. 

Our RegWatch Team will continue to monitor developments closely. If you have questions about the EU Omnibus Package, feel free to contact us.