CSRD Requirements After Omnibus I: Who Reports and What
The Corporate Sustainability Reporting Directive (CSRD) now applies only to very large companies. Under the Omnibus I simplification, EU companies must employ more than 1,000 people on average and have net annual turnover above €450 million. Those in scope publish a sustainability statement in their annual report, prepared under the European Sustainability Reporting Standards (ESRS). UK companies are not covered directly, but some are caught through EU subsidiaries or EU turnover.
Much of what ranks on Google still describes the older, broader rules, so check any guide for its date. This one reflects the position in October 2026.
Key takeaways
The CSRD scope is now above 1,000 employees and above €450 million net annual turnover. Many companies that expected to report are out of scope.
Non-EU groups are caught when they generate more than €450 million net turnover in the EU. Being in the UK does not exempt you on its own.
In-scope companies report under the ESRS, built on double materiality: the company’s impact on people and the environment, and sustainability risks to the company.
Sector-specific reporting is voluntary, and the reports are meant to be more quantitative.
UK reporting is a separate regime: the UK Sustainability Reporting Standards are available for voluntary use, and private companies are not yet required to report against them.
What the CSRD is
The CSRD is EU Directive 2022/2464. It replaced the earlier non-financial reporting rules with a more detailed regime. As the European Commission explains, the rules require large and listed companies to publish regular reports on the social and environmental risks they face, and on how their activities affect people and the environment.
Three features set it apart from voluntary ESG reporting:
A fixed standard. Reports follow the ESRS rather than a framework the company picks.
Placement in the management report. The sustainability statement sits beside the financial information. It is not a separate glossy brochure.
Assurance. The information is subject to independent assurance, with the level of rigour increasing over time.
If you want the longer background, our guide to CSRD reporting: who must report, what to include and how to start covers it in more depth.
Who must comply: the current thresholds
The original directive reached far more companies, including those with more than 250 employees. Omnibus I narrowed this sharply. The Council’s final sign-off in February 2026 raised the thresholds, and the European Parliament’s legislative tracker confirms the same test.
Type of company | Test under the simplified CSRD |
EU company | More than 1,000 employees on average and net annual turnover above €450 million |
Non-EU company | Net turnover above €450 million generated within the EU |
Note the word “and” for EU companies. A business with 3,000 staff but €300 million of turnover is outside the scope. So is a €600 million business with 800 employees.
Timing and the wave-one exemption
Companies that were already reporting from the 2024 financial year (wave one) are treated separately. Under the Council’s final text, wave-one companies that fall below the new thresholds can benefit from an exemption for the 2025 and 2026 financial years. For companies newly in scope, one UK-based explainer puts the first reporting year at the 2027 financial year. Confirm your own date against the Directive text or with your auditor, because transposition details differ by member state.
Why small companies still get asked for data
The narrower scope reduces the pressure on suppliers. Smaller companies are now shielded from reporting beyond voluntary standards, which should ease the flow of detailed data requests that many expected. Still, large customers, banks and investors may ask for similar information on their own terms. A supplier with tidy emissions and workforce data will answer those requests faster, whatever the law says.
What in-scope companies must report
The ESRS
Reports for in-scope entities must be prepared in line with the ESRS. The standards cover environment, social and governance topics, plus cross-cutting requirements that apply to every company. Topics include climate change, pollution, water, biodiversity, circular economy, your own workforce, workers in the value chain, affected communities, consumers and business conduct.
Omnibus I changed two things in practice:
Reports are intended to be more quantitative, with less narrative description.
Sector-specific standards are now voluntary rather than mandatory.
The policy aim, according to the Parliament’s legislative tracker, is to ease reporting fatigue and keep reports useful for decisions. For the background to the standards themselves, see our piece on the path towards ESRS adoption.
Double materiality
The ESRS do not ask you to report everything. You report what is material, and “material” is judged in two directions:
Impact materiality: how your operations and value chain affect people and the environment.
Financial materiality: how sustainability issues create risks or opportunities for your finances.
A topic is reportable if it passes either test. Training practitioners consistently warn that teams underestimate the effort a double materiality assessment takes, and it remains the step that decides everything downstream, even under the simplified rules. Our practical guide to double materiality assessment walks through the method, and this overview of the concept is a gentler starting point.
Format and assurance
The statement must be human-readable and machine-readable. That means digital tagging, so your data needs to be structured from the start rather than copied out of a document at the last minute. Assurance means an independent party will test your figures, so each number needs an owner, a source and a calculation you can reproduce.
Does the CSRD apply to UK companies?
There is no UK version of the CSRD. UK sustainability reporting runs on a separate track. According to the government’s consultation response on the UK Sustainability Reporting Standards, UK SRS S1 and S2 are based on ISSB standards and are available for voluntary use. Private companies are not yet required to report against them, as the government plans to consult on a modernised corporate reporting framework.
The CSRD can still reach a UK business in a few ways:
You own an EU subsidiary that is itself above the thresholds, or an EU sub-group that is.
Your securities are listed on an EU regulated market and you meet the same size test.
Your EU turnover is above €450 million. For non-EU companies, this is the test that matters.
A UK parent whose EU activity is modest will generally find itself outside the CSRD. Run the numbers on EU net turnover before you assume either way, and ask your legal adviser to confirm the position for each EU entity.
A practical way to prepare
Whether you are in scope or preparing voluntarily, the order of work is roughly the same.
Confirm scope. Check employees and turnover at entity and group level, and EU turnover if you are headquartered outside the EU.
Map your value chain and stakeholders. Decide who is affected by you, and who you depend on.
Run the double materiality assessment. Document the method, thresholds and sign-off. Auditors will ask for the evidence.
Find your data gaps. Compare what the material ESRS datapoints require with what you can actually evidence today.
Assign owners. Finance, HR, operations and procurement each hold part of the data.
Build the controls. Treat sustainability data like financial data, with review steps and an audit trail.
Run a dry-run report before the first real one, ideally with your assurance provider involved.
Even a company outside the scope can use steps 1 to 4. They show where the real risks and efficiencies sit.
Treat it as more than compliance
Experts advise against seeing the CSRD purely as a box-ticking exercise. Organisations that fold sustainability data into their financial controlling systems satisfy assurance requirements and gain insight into resource efficiency and risk. That same discipline shapes how investors read you. Sustainability-minded companies increasingly present themselves to funders through investor-facing profiles such as this one, and credible, well-controlled data supports that story.
Common mistakes
Using out-of-date guidance. Many pages still cite the 250-employee test or the old timetable.
Leaving materiality to the sustainability team alone. Finance and operations need to be in the room, since the financial-materiality half is about money.
Starting data collection before scoping the topics. You gather far too much and still miss what matters.
Ignoring value-chain data. Some ESRS topics reach beyond your own operations.
Underestimating assurance. Weak documentation shows up only when an auditor asks for it.
Training for your team
The CSRD touches finance, legal, HR and operations, so one person cannot carry it. At Exereco we run ESG training courses alongside our reporting software, advisory support and news coverage of Europe and Africa. If your team needs a grounding in responsibility and reporting practice, start with our Corporate Social Responsibilities course, or get in touch through our homepage to discuss advisory support or reporting software.
If you are comparing training options, look for these features, whoever delivers the course:
Hands-on double materiality work, not only slides.
Coverage of the ESRS as revised, not the original 2023 text.
Practical exercises on data collection and assurance readiness.
Content updated for Omnibus I.
Our earlier explainer on the EU’s FAQs on CSRD compliance is also useful for interpretation questions.
FAQ
What is the CSRD?
The CSRD is an EU directive requiring large companies to publish audited sustainability information in their annual reports. It covers environmental, social and governance topics, reported under the ESRS. The Commission’s overview describes the aim as giving a clearer picture of risks and impacts.
What are the CSRD thresholds now?
For EU companies, the thresholds are more than 1,000 employees on average and net annual turnover above €450 million. Non-EU companies are caught if they generate more than €450 million net turnover in the EU. Both figures come from the Council’s February 2026 decision.
Is ESG reporting mandatory in the UK?
Not under the CSRD, and the UK Sustainability Reporting Standards are currently voluntary. Private companies are not yet required to report against them. Listed companies and large firms may have other disclosure duties, so ask your legal or audit adviser about your own position.
Do I still need a double materiality assessment if I am out of scope?
Not as a legal duty under the CSRD. It is still the most useful way to see which sustainability issues affect your business and which of your impacts matter. Many companies run one voluntarily to answer customer, lender and investor questions.
Is sector-specific reporting still required?
No. Under the updated rules, sector-specific standards are voluntary. In-scope companies focus on the core ESRS disclosures that their materiality assessment identifies.
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