Context: recalibrating European sustainability
Today, the European Commission finally approved the first Omnibus Package, which aims to simplify and reduce the administrative burden on EU companies, thus ensuring their competitiveness without compromising their sustainability obligations.
Since the great consensus of 2015, sustainability regulation has grown rapidly in Europe as part of the Green Pact, responding to the need for urgency, accelerating the response of companies and governments and raising the discourse and commitment of boards of directors. But, on the other hand, and as the Draghi report pointed out, the increased pressure on companies has also generated some undesired effects such as excessive bureaucracy, legal uncertainty, risk of non-compliance and doubts about its impact on competitiveness.
Dado este contexto, en este segundo segundo mandato de Von Der Leyen, la nueva Comisión Europea busca recalibrar su estrategia potenciando la seguridad, calidad de vida y crecimiento sostenible, fortaleciendo su competitividad frente a EE.UU. y China ante los desafíos tecnológicos, climáticos y económicos. Siguiendo esta estrategia, a principios de 2025 presentó la Brújula para la Competitividad, un instrumento clave para guiar su acción y adelantar algunas de las principales medidas, que han sido publicadas hoy.
Clean Industrial Pact and Action Plan on Affordable Energy
The general objective of the European Commission's Clean Industrial Deal communication is to promote a competitive and decarbonized industry, in which this reduction of emissions is profitable and achievable. To this end, it proposes, among other measures, the following:
- Encourage demand for decarbonized products, creating lead markets for European clean technologies and products. Along these lines, the Industrial Decarbonisation Accelerator Act will be published by the end of 2025.
- Relying on the circular economy, reducing dependence on unreliable suppliers and creating the Circular Economy Act that, from 2026, will facilitate the market for circular products and secondary materials.
- Develop sector transition plans to facilitate informed investment decisions, with a special focus on SMEs.
- Update the Public Procurement Directive to give more weight to sustainability criteria.
- Supporting a just transition, with measures such as the creation of the EU Talent Pool, the Union of Skills - to facilitate skills development - or the Quality Jobs Roadmap - to support employees.
- Lowering the cost of electricity. To this end, the Affordable Energy Action Plan has also been published, which proposes short-term measures, such as energy efficiency or improving gas markets, and medium- and long-term structural reforms, such as the creation of an Energy Union.
In Search of Simplification: First Omnibus Package
The first Omnibus package has been presented today in the form of several proposals for Directives and Regulations aimed at simplifying various regulations, affecting the Reporting Directives (CSRDD), Due Diligence (CSDDDD), the European Taxonomy, the Border Carbon Adjustment Mechanism (CBAM) and the InvestEU Program.
The main changes are presented below:
| Sustainability Due Diligence Directive (CSDDD) | First Omnibus Simplification Package | |
|---|---|---|
| Companies affected | Scope of business is maintained | |
| Entry into force | Application to the first companies begins in 2027. | The implementation of the Directive for the affected companies is postponed by one year; the first phase will now start in 2028. |
| Scope of the value chain | The entire value chain is covered, both direct suppliers and indirect subcontractors. | Only direct suppliers (Tier 1) and duty to carry out due diligence on other links when there is "plausible information". |
| Stakeholder engagement | A broader concept that also included representatives of workers, unions, consumers, affected persons, civil society organizations, among others. | It comes down to workers, their representatives, direct communities and affected people. |
| End of business relationship | Possibility of terminating the business relationship as a last resort after unsuccessful attempts to eliminate or minimize actual impacts | This section is withdrawn |
| Liability | A company can be held civilly liable for non-compliance if certain requirements are met | This section is withdrawn |
| Legal standing | Possibility for the injured party to authorize a trade union, NGO or national human rights institution to file a lawsuit to enforce his or her rights. | This section is withdrawn |
| Due diligence system review periods | On an annual basis | The due diligence update period is extended to every 5 years or when there are reasonable grounds to believe that the measures are no longer adequate or effective. |
| Sanctions | Financial penalties (determined by each state) shall not be less than 5% of net worldwide turnover. | The maximum rate is removed and not linked to turnover. The Commission will issue guidance to assist states in determining penalties. |
| Financial entities | It envisaged the possibility of establishing additional due diligence requirements for financial services and investment activities. | This section is withdrawn |
| Transition plans | Need to adopt and implement a transition plan | Requirements on the adoption of transition plans for climate change mitigation are harmonized with the CSRD. |
| Transposition into national legislation | The deadline for transposition of the Directive is July 26, 2026. | Posponer un año el límite para transponer la Directiva a 2027. Restringir a los Estados miembros la introducción de normas más estrictas para hacer frente a los impactos en derechos humanos por parte de las empresas |
| Sustainability Reporting Directive (CSRD) | First Omnibus Simplification Package | |
|---|---|---|
| Companies affected | 1) Large companies/large group parent companies that are public interest entities +500 employees) 2) Large companies/large group parent companies other than the above 3) Listed SMEs (except microenterprises) | Large companies with +1000 employees and: a turnover of +50 million euros, or a balance sheet of +25 million euros. |
| SMEs | Listed SMEs report in 2027 | Withdraw mandatory |
| ESRS | The CSRD is accompanied by the ESRS: two cross-cutting standards and 10 thematic standards (environmental, social and good governance). | Review of ESRS to reduce, clarify content and improve consistency. |
| ESRS Sectorial | In process for 9 sectors | There will be no sectorial ESRS |
| Application calendar | Mandatory as of January 1, 2024 | Defer reporting requirements for obligated companies by two years, with reporting to start in 2026 or 2027 |
| Verification | Limited verification and reasonable verification by 2028 | Remove the possibility of changing from limited to reasonable verification |
| Taxonomy Delegated Acts | First Omnibus Simplification Package | |
|---|---|---|
| Companies covered | 1) Large companies/large group parent companies that are public interest entities +500 employees) 2) Large companies/large group parent companies other than the above 3) Listed SMEs (except microenterprises) | Voluntariedad para grandes empresas de +1000 empleados, con un volumen de negocio neto de hasta 450 millones de euros. Empresas que cubran algunos criterios pueden reportar voluntariamente su alineamiento. |
| Delegated Act on Taxonomy, Climate and Environment | Proposed delegated act whereby companies would be exempted from the eligibility and alignment assessment of their economic activities that are not financially significant (10% of their turnover). In addition, it opens the possibility to exclude from the denominator of the RAG exposures related to companies outside the scope of the future CSRD. Views are sought on alternative options in the simplification of the DNSH. | |
| Carbon Border Adjustment Mechanism (CBAM) | First Omnibus Simplification Package | |
|---|---|---|
| Companies covered | All importers of carbon-intensive products covered by the CBAM | Companies importing more than 50 tons ofCO2 per year (90% of the companies and only 1% of the emissions are reduced). |
| Procedure | Complex procedure for emissions calculation and reporting | It is proposed to simplify authorizations, while strengthening the mechanism to prevent evasion. |
| Future | An analysis report will be made in the second half of 2025, and in early 2026 there will be a legislative proposal to extend the scope to more sectors. | |
The future of sustainability
In the Forética 2024 Report we anticipated that regulatory disinflation and relaxation would be the roadmap on the agenda of the new European Commission. The evolution of the political and economic context confirms that companies must prepare for a scenario where sustainability will continue to be a strategic axis, but with a possible recalibration in the intensity of regulatory requirements and in a context of consumer skepticism towards greenwashing.
In addition, exposure to physical risks from climate change highlights the urgency of strengthening business resilience, especially in the supply chain and in integrating ESG criteria into risk management. Companies must strike a balance between cost efficiency, risk management, positive societal impact and regulatory compliance, while maintaining their license to operate and strengthening their attractiveness to investors.
Sustainable transformation in Europe offers companies the opportunity to lead change through transparency, innovation and adaptation to new market demands, consolidating their role in a more sustainable and resilient economy.
What's next? Next steps
The content of the documents published today are not definitive, but are proposals from the Commission. These proposals, both for Directives and Regulations, reopen a legislative process, with a series of subsequent steps until a definitive text can be reached.
The proposals prepared by the Commission will pass in first reading to the Parliament (it can approve it or present amendments) and to the Council (it can accept the Parliament's position or not) and a series of trialogues will take place between the three institutions. Depending on the degree of agreement between the bodies, the procedure will take more or less time and thus the final text will be obtained.
At Forética we will closely follow the legislative developments in sustainability in the different business initiatives.
Links to the measures presented
📘 Descarga aquí el documento elaborado por Forética con toda la información.
