Last week the EU Commission caused a stir by releasing the first “EU Omnibus package”. The package proposes a rollback on EU climate regulation, including the EU Corporate Sustainability Directive.

The proposal aims to relieve SMEs of sustainability reporting, narrowing the focus to large enterprises that have the biggest impact on people and the environment. By removing red tape and giving companies more time to prepare, it “should” make EU markets more competitive.

However, it’s caused uproar amongst sustainability professionals. Investors worth $6.8trn have also pushed back. In theory, the proposal should free up resources to focus on strategy, transforming operations, and making deep decarbonisation cuts. However, the cost could be their seat in the boardroom, poor investment decisions, and a growing green skill gap.

It’s important to remember that the EU Omnibus is still just a proposal, it’s unclear what changes will be passed.

What could change for the CSRD?

The EU Omnibus proposes changes to four different pieces of legislation, including the CSRD, CSDDD, Taxonomy, and CBAM. Specifically for the EU CSRD, the EU Commission has proposed the following revisions:

Fewer companies in scope

• Would only apply to companies with >1,000 employees and either €50M turnover or €25M balance sheet total (previously 250+ employees).
• The number of companies covered would reduce from >50,000 to <7,000.

Looser reporting requirements

• Third-country companies could only be subject if turnover exceeds €450M (previously €150M).
• Potentially no mandatory data collection from non-CSRD suppliers.
• Limited assurance is still required, but no transition to reasonable assurance.
• Double materiality (financial + impact) reporting remains unchanged.

Delays to reporting deadlines

• Wave 2 and Wave 3 companies could get two extra years to report.

Sector-specific reporting scrapped

• Possibly no mandatory sector-specific ESRS standards.

Will the EU Omnibus derail the green transition?

No.

While the EU Omnibus could reduce the scope of companies required by law to reduce the impact of their operations, many companies are doing so voluntarily. Companies worth over 66% of global market capital already disclose their environmental impact.

The green transition continues to accelerate despite politics. New research shows that the proportion of businesses committed to achieving net zero by 2030 has nearly doubled since last year, rising from 28% to 47%.

Even in the US, where Trump is stamping out climate policy, momentum continues. Individual states are stepping up, with California inaugurating an offsetting bill. The Lune Logistics Team is currently at the biggest logistics conference in the US (TPM25 hosted by S&P Global) and they’ve reported an insatiable appetite for green logistics. So far we’ve had 110 responses from logistics professionals.

This is likely because the carrot far outweighs the stick. Companies cutting their scope 3 emissions have already saved $13.6 billion in costs. The EU is also ramping up its incentives for green development by flushing the market with a €100bn Clean Industrial Deal. Tasked with enhancing decarbonisation alongside competitiveness, sustainable business is the only trajectory for success.

Decarbonisation, and therefore emissions reporting, continues

The EU Omnibus is a proposal; we hope to know more later this year. Creating yet more uncertainty, ESG teams are being advised to continue business as usual. That means collecting emissions data for EU CSRD compliance ahead of current deadlines.

We’ve reached the green tipping point. Businesses are already reducing emissions — regardless of regulation. This means having actionable emission intelligence to guide your company smoothly through the green transition is more important than ever.

At Lune, we’ll be watching the proposal closely. To stay up-to-date with the latest updates regarding EU climate regulation, subscribe to our newsletter.