The EU published new sustainability reporting rules in 2022, requiring companies to report the impact of their activities on people and the environment. With the approval of the EU's Omnibus package, significant changes have been made.
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[Last updated: 21 November 2025, based on the communication from the European Parliament.]
On 14 December 2022, the European Union published a new rule requiring companies to report regularly on the effect of their activities on people and the environment. Below, we outline its key elements, now updated with the latest legislative changes under negotiation.
The CSRD is Directive (EU) 2022/2464 of the European Parliament and of the Council, of 14 December 2022, amending Regulation (EU) 537/2014, Directive 2004/109/EC, Directive 2006/43/EC and Directive 2013/34/EU. In English, it is known as the Corporate Sustainability Reporting Directive or CSRD.
Its aim is to place sustainability information on an equal footing with financial information, addressing the growing demand for reliable and comparable data (especially from the investor community). The CSRD seeks to enhance transparency, improve the quality of reporting and strengthen confidence in the information companies provide on their environmental, social and governance performance.
These are the main changes brought by the CSRD and its most recent amendments:
The EU’s Omnibus I package significantly narrows the scope of the CSRD.
While the original text considerably expanded the number of companies required to report, the latest simplification proposals introduce higher thresholds:
These figures replace the thresholds initially proposed (1,000 employees and EUR 50 million turnover).
The aim is to focus obligations on companies with the greatest administrative and operational capacity, while reducing the regulatory burden for the rest.
Important note: Negotiations between Parliament and Council are ongoing. The thresholds may be adjusted during trilogues, although they represent the legislator’s most recent position.
This legislation requires large companies to report regularly on the impact of their activities on the environment, human rights and social matters. The Directive seeks to combat greenwashing, strengthen the EU’s social market economy and lay the foundations for global sustainability standards.
In the long term, the CSRD aims to place sustainability information on the same level as financial information, providing investors and the public with reliable and comparable data for decision-making.
The Council approved the text on 28 November, and it entered into force on 5 January 2023.
However, under the EU’s Omnibus I simplification package, the entry into force of reporting requirements is postponed by two years for:
This deferral aims to allow co-legislators to reach a final agreement on the proposed changes and to avoid an excessive administrative burden.
The CSRD requires companies to subject their sustainability reports to independent audits and assurance processes, ensuring their accuracy and reliability.
Access to sustainability information is also guaranteed in digital format, supported by harmonised technical standards and the forthcoming single reporting portal.
The ESRS (European Sustainability Reporting Standards), known in Spanish as NEIS (Normas Europeas de Información Sostenible), are a set of standards developed under the CSRD by EFRAG.
They define the information companies must disclose regarding their environmental, social and governance impacts. They cover areas such as:
Following the Omnibus simplification, the ESRS will apply more flexibly:
Double materiality requires companies to disclose information from two perspectives:
How ESG factors influence the company’s financial performance, long-term viability and enterprise value — assessing risks and opportunities arising from sustainability issues.
How the company’s activities affect the external environment, including society and the planet. This includes impacts on biodiversity, climate, public health, social cohesion and more.
By adopting this approach, the CSRD provides a comprehensive and balanced view:
• how sustainability risks and opportunities affect the company, and
• how the company affects the world around it.
This enables investors, regulators and other stakeholders to make better-informed decisions.
At TEIMAS, we aim to help companies understand their new obligations in response to the so-called "regulatory tsunami" from the EU. That's why we've organised a series of workshops to explain key regulations on sustainability and the circular economy. Explore all the videos of the Surfing the Tsunami of Sustainability Compliance series here.
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