CSRD — Corporate Sustainability Reporting Directive
EU corporate sustainability reporting requirements — significantly narrowed by the 2026 Omnibus package. Reporting against European Sustainability Reporting Standards (ESRS).
Overview
The Corporate Sustainability Reporting Directive (CSRD) — Directive (EU) 2022/2464 — requires large companies to report on sustainability matters using the European Sustainability Reporting Standards (ESRS). The scope was dramatically narrowed by the Omnibus simplification package in February 2026.
Legal basis
- Proposed: 21 April 2021
- Adopted: 16 December 2022
- Entered into force: 5 January 2023
- Significantly amended: Omnibus Directive (EU) 2026/470 (published OJ 26 February 2026; in force 18 March 2026)
- Transposition deadline for the Omnibus CSRD amendments: 19 March 2027 (Directive (EU) 2026/470, Art. 5(1))
Post-Omnibus scope
The Omnibus package removed approximately 80% of originally in-scope companies:
New thresholds:
- EU companies: >1,000 employees AND >450 million net turnover
- Non-EU companies: >450M net turnover generated in EU
- Listed SMEs: removed from mandatory scope entirely
Reporting standards (ESRS)
Companies report against European Sustainability Reporting Standards:
- ESRS 1: General requirements
- ESRS 2: General disclosures
- ESRS E1-E5: Environmental (climate, pollution, water, biodiversity, resource use/circular economy)
- ESRS S1-S4: Social (workforce, value chain workers, communities, consumers)
- ESRS G1: Governance
ESRS E5 (Resource use and circular economy) has direct relevance to DPP product data.
Simplified ESRS (Delegated Regulation (EU) 2026/1563)
The Commission's simplified ESRS were adopted on 3 July 2026 as Delegated Regulation (EU) 2026/1563 and published in the Official Journal on 21 September 2026. The amendments reduce the number of datapoints and prioritise quantitative datapoints over narrative text.
- Entry into force: 10 November 2026
- Application: financial years beginning on or after 1 January 2027
- FY 2026 choice: for financial years beginning in 2026, undertakings may apply either the previous ESRS (Delegated Regulation (EU) 2023/2772 as last amended by 2025/1416) or the simplified standards, and must state in their sustainability statement which version they apply
Value-chain cap (Delegated Regulation (EU) 2026/1560)
Delegated Regulation (EU) 2026/1560, published in the Official Journal on the same day, establishes sustainability reporting standards for voluntary use. It also defines the value-chain cap: the upper limit of sustainability information that in-scope companies may require from undertakings in their value chain with an average of no more than 1,000 employees. It entered into force on 24 September 2026, and the cap applies from financial years beginning on or after 1 January 2027.
Timeline
| Date | Event |
|---|---|
| FY 2024 | Wave 1 reports (formerly NFRD companies >500 employees) |
| April 2025 | "Stop-the-clock" Directive (EU) 2025/794 — 2-year extension for Waves 2 & 3 (Wave 2 to FY 2027, Wave 3 to FY 2028) |
| 26 February 2026 | Omnibus Directive (EU) 2026/470 published — scope substantially narrowed |
| 21 September 2026 | Simplified ESRS (2026/1563) and value-chain-cap standard (2026/1560) published in the OJ |
| 10 November 2026 | Simplified ESRS enter into force |
| 19 March 2027 | Transposition deadline for the Omnibus CSRD amendments |
| FY 2027 | Remaining in-scope companies (>1,000 employees, >450M) report; simplified ESRS and value-chain cap apply |
Who is affected
- Wave 1 (already reporting for FY 2024): Companies formerly subject to the Non-Financial Reporting Directive (NFRD) — approximately 11,700 large listed companies, banks, and insurers with more than 500 employees
- Wave 2 (from FY 2027): EU companies with more than 1,000 employees AND more than €450 million net turnover; Non-EU companies generating more than €450 million net turnover in the EU
- Listed SMEs: Removed from mandatory scope entirely by the Omnibus package (February 2026)
- Value chain SMEs: Companies with up to 1,000 employees may receive information requests from in-scope companies, but from FY 2027 those requests are limited by the value-chain cap set in Delegated Regulation (EU) 2026/1560
Penalties and enforcement
The CSRD does not itself set a fine level. Member States set the penalties for breaches of their national rules transposing the reporting requirements, and those penalties must be effective, proportionate and dissuasive (Directive 2013/34/EU, Art. 51) (EUR-Lex). The type and level of penalty therefore vary by Member State.
In this area, the Omnibus Directive (EU) 2026/470 changed assurance but left the penalty rule unchanged:
- Sustainability reporting is assured on a limited assurance basis. The Commission must adopt limited assurance standards by 1 July 2027, and the requirement to adopt reasonable assurance standards was removed (Directive 2006/43/EC, Art. 26a(3) as replaced, and recitals 4 and 5 of Directive (EU) 2026/470) (EUR-Lex)
The 3% of net worldwide turnover cap on fines and the civil liability changes in the Omnibus apply to the CSDDD (Directive (EU) 2024/1760, Arts. 27 and 29), not to CSRD reporting.
Double materiality
CSRD requires companies to assess sustainability matters using double materiality — evaluating both:
- Impact materiality: How the company's activities affect people and the environment
- Financial materiality: How sustainability risks and opportunities affect the company's financial position
This dual assessment determines which ESRS standards and data points must be disclosed. ESRS E5 (Resource use and circular economy), including DPP-adjacent metrics on recyclability, recycled content, and material flows, is subject to double materiality assessment.
Relevance to DPP
CSRD and DPP are designed as complementary data systems:
- ESRS E5 demands disclosure on material resource flows, recyclability, recycled content
- Companies must disclose circular economy policies at product level
- CSRD disclosures can leverage DPP data for automated reporting
- Product-level DPP data aggregates into corporate-level CSRD reporting
Key articles
- Article 19a (as amended): Content of sustainability reporting
- Article 29b: European Sustainability Reporting Standards (ESRS)
- ESRS E5: Resource use and circular economy — most relevant to DPP product data