EU Omnibus I Directive: What Changes for CSRD Reporting and CSDDD Due Diligence

Directive (EU) 2026/470, published on 26 February 2026 and in force since 18 March, substantially simplifies the EU's sustainability reporting framework (CSRD) and due diligence framework (CSDDD). It is the core piece of the Omnibus I package: it raises thresholds, cuts obligations, and delays timelines to reduce companies' administrative burden.

What changes under the CSRD

• New scope threshold: only companies with more than €450 million in net turnover and more than 1,000 employees must report. Both criteria have to be met at once.
• Value chain protection: companies with fewer than 1,000 employees cannot be asked for more information than the voluntary standard contains, and that limit cannot be overridden by contract.
• Voluntary standard: the Commission adopted the delegated act with the voluntary sustainability standard for SMEs on 3 July 2026, the same day as the revised ESRS. It builds on Recommendation (EU) 2025/1710 of 30 July 2025, which published the VSME standard.
• Third-country companies: the threshold rises to €450 million in EU turnover, with a subsidiary or branch above €200 million.
• Lighter assurance requirement: the planned future move to reasonable assurance is dropped. The level stays at limited assurance, and the corresponding standard has to be adopted before 1 July 2027.
• Timeline: the new thresholds apply to financial years starting on or after 1 January 2027. Watch out for a common misreading: wave 1 companies that fall below the threshold still report FY2025 and FY2026 unless their Member State exempts them when transposing.

What changes under the CSDDD

• Much higher thresholds: from 1,000 to 5,000 employees and from €450 million to €1.5 billion in global turnover. Third-country companies face the same €1.5 billion EU turnover threshold.
• Simplified due diligence process: companies first run an exploratory exercise using reasonably available information, then a deeper assessment only in the highest-risk areas.
• Less pressure on smaller suppliers: business partners with fewer than 5,000 employees can only be asked for information when it cannot reasonably be obtained another way.
• The obligation to adopt and implement a climate transition plan is removed. The final directive deletes that requirement entirely.
• Less frequent monitoring: periodic assessments move from annual to once every five years, unless there is a significant change or a new risk.
• The EU-wide civil liability regime is dropped (former Article 29 of the CSDDD), though the right to full compensation under national law remains, together with a review clause that leaves the door open to revisiting it.
• A uniform penalty cap: the maximum penalty is capped at 3 % of global net turnover, replacing the 5 % that the original CSDDD set as the floor for that maximum.
• Unified timeline: transposition by 26 July 2028, and a single application date of 26 July 2029 for all companies in scope, replacing the original staggered rollout.

What this means for your company

If your company was preparing its first CSRD report and now falls outside the new thresholds, the legal obligation disappears, but market pressure does not: investors, banks, and large corporate clients will keep asking for sustainability data, often leaning on the same voluntary standard the Commission adopted in July 2026.

And if your company does meet the new thresholds, or will soon through growth, the delayed timeline is a window, not an excuse: it buys time to build a solid data system instead of scrambling at the last minute.

Manglai helps companies keep their carbon, water, and waste footprint data organised and audit-ready, whether that means reporting under the CSRD or responding to information requests from clients and business partners who are still in scope. You can see how it works in Manglai's carbon footprint software.