Omnibus proposal from the EU aims to reduce the reporting burden on businesses
On 26 February, the EU presented its so-called Omnibus proposal. The aim is to reduce the reporting burden on companies. The proposal is comprehensive and, if implemented, will mean that around 2,000 Danish companies will be exempt from statutory sustainability reporting. Although this will ease the pressure on many companies – both those with fewer than and more than 250 employees – it is still a good idea to maintain the level of ambition. One should also consider VSME, which is now becoming relevant to many more companies.
The EU Omnibus Proposal: What It Means for Companies
The EU’s Omnibus proposal is divided into two main parts:
- The deadlines are postponed. Companies that, under the current rules, were required to report for the first time in 2025 or 2026, will now only be required to report for financial years starting January 2027.
- Detailed changes to the CSRD, CSDDD, EU taxonomy and CBAM are proposed. This article focuses on the CSRD, but you can read about the other changes at Danish Industry here.
Fewer Companies Covered by CSRD
The most significant change in the CSRD is the increase in the size threshold. The requirements will now apply to companies with more than 1,000 employees and either a turnover of more than €50 million or a balance sheet total of more than €25 million. Previously, the requirements applied to companies with more than 250 employees. This means that the number of companies covered by the CSRD will be reduced by around 80% in the EU. The potential date of adoption of the proposal and the technical details can be found at Danish Industry here.
VSME Becomes Relevant for More Companies
The VSME standard, which ESG365 work with, will now be relevant for all companies with up to 1,000 employees. The European Commission proposes that companies that were previously covered by CSRD but are no longer covered can use VSME instead. At the same time, they will issue a regulation so that large companies and banks cannot request information from companies with fewer than 1,000 employees (unless the information is normally shared in the sector). In future, all companies with fewer than 1,000 employees will be able to use the VSME standard.
The new proposal removes significant pressure from many companies. Although the pace of the ESG train is slowing down slightly, it is still a good idea to get started with VSME. From a business perspective, it is advantageous to have control over VSME data points because companies subject to CSRD must comply with the VSME standard when requesting data. At ESG365, we recommend making a plan, starting with the basic module and later looking at the extended module.
At ESG365, we are delighted that our software and consulting services will now be relevant to many more companies, and that a large number of companies will be able to lighten their workload.
If you need help getting started with your ESG-report or the VSME-standard, ESG365 has the expertise to help you.
Article by Victoria Ørum, Communications Manager, ESG365.