CSRD Changes: What Manufacturers Need to Know
The European Parliament’s Legal Affairs Committee (JURI) has approved draft changes to simplify sustainability reporting for industrial companies.
The EU Omnibus recalibrates directives like the Corporate Sustainability Reporting Directive (CSRD), easing the administrative burden on manufacturers.
It narrows the range of companies that must comply with mandatory reporting, raising the threshold to companies with more than 1,000 employees and a net annual turnover exceeding €450m.
This revised scope will also apply to European Union taxonomy regulations. For firms outside these limits, reporting would become voluntary.
Rapporteur Jörgen Warborn, a Swedish MEP, said the vote supports simplification.
He stated that the revisions would “cuts costs, strengthens competitiveness, and keeps Europe’s green transition on track".
Redefined scope for CSRD and CSDDD
A key provision in the draft aims to protect smaller suppliers. It states that large companies cannot demand sustainability information from smaller partners beyond what voluntary standards require.
This prevents the compliance burden from being passed down the value chain. Sector-specific reporting standards would also become voluntary under the new rules.
On due diligence, the committee wants to restrict the Corporate Sustainability Due Diligence Directive (CSDDD) to very large companies.
For EU firms, this means those with more than 5,000 employees and a net turnover above €1.5bn. The same turnover threshold applies to non-EU companies based on their EU turnover.
To support businesses the commission will launch a digital portal with free templates, guidelines, and information.
Expert reaction
The move at least offers clarity for business leaders. Stefan Premer, Director of Consulting at Sphera, says there will be a “sigh of relief” from many.
He notes that, while some hoped for a 500-employee threshold, the compromise of 1,000 employees excludes 90% of companies previously expected to report.
Andreas Rasche, a Professor at Copenhagen Business School, also welcomed the new predictability. He commented that the prior lack of certainty held back action and investments.
However, the reaction has not been universally positive. Some groups argue that the changes weaken the legislation.
Mariana Ferreira, of the WWF European Policy Office, says scrapping civil liability from the CSDDD was a major point of dissent.
She argues this will “severely gut the effectiveness of the law” by undermining access to justice and turning due diligence into a “toothless box-ticking exercise".
Strategic response beyond compliance
Experts advise that companies no longer in scope should still consider the strategic implications.
Jan Niewold, of EY, says the vote is not a retreat from sustainability but a “strategic recalibration” to boost competitiveness.
He suggests businesses evaluate their position and consider voluntary disclosure, explaining that strengthening governance integrating ESG and using technology are essential to reduce costs.
This view is shared by Andromeda Wood Workiva’s Vice President of Regulatory Strategy. She argues that regulatory uncertainty requires a robust internal approach.
Andromeda states that a “value-driven approach” is needed where sustainability data provides a clear view of a company’s “risks opportunities and impacts.”
She adds that integrating sustainability risk and financial data creates a single source of truth. This makes it easier to adapt to change and strengthens business decisions.
For manufacturers this integrated view could turn a regulatory burden into a competitive advantage and build long-term resilience.
