Omnibus explained: key changes to CSDDD

Accountancy Europe’s has issued three factual analysis of the European Commission’s (EC) recent Omnibus proposal focusing on the Corporate Sustainability Reporting Directive (CSRD), sustainability reporting standards, and Corporate Sustainability Due Diligence Directive (CSDDD). These papers aim to give stakeholders an initial overview of the key proposed changes expected to reshape sustainability reporting and due diligence practices across Europe. Read also our statement on the EC Omnibus sustainability proposal.

This paper will focus on the proposed changes for CSDDD

For more information on CSDDD, check out our factsheet Corporate Sustainability Due Diligence Directive – what the accountancy profession should know.

Omnibus background

The EC launched the Omnibus sustainability rules simplification package on 26 February 2025. This is the first step of an ambitious simplification agenda to enhance European economic competitiveness. It aims to reduce administrative and reporting burdens on companies and unlocking businesses’ investment potential.

The new simplification agenda set bold targets, including a 25% cut in reporting burdens for companies and 35% for SMEs. The EC expects this effort to boost European companies’ competitiveness while maintaining climate and decarbonisation goals of the Green Deal. The Omnibus package proposes amendments to several sustainability laws. These include the CSRD, the CSDDD, the EU Taxonomy for sustainable activities, and the Carbon Border Adjustment Mechanism (CBAM).

Key CSDDD changes

The Omnibus Directive proposes the following changes:

• A narrowed ‘stakeholder’ definition
• Member States are restricted from introducing more stringent rules to tackle human rights and environmental abuse
• Value chain due diligence is limited to direct suppliers
• Companies are required to consider SME support measures
• Companies are no longer obligated to terminate the business relationship
• Monitoring frequency reduced from every year to once every five years
• The obligation to “put into effect” a transition plan has been removed
• Approach to pecuniary penalties has been revised
• EU wide civil liability regime is deleted, leaving this to the discretion of Member States
• Requirement for a report on financial undertakings is removed
• Application deadline is postponed whilst deadline for guidelines is brought forward

Way forward

It is important to note that the EC proposals are not final. The EC will submit the proposal to the two co-legislators – the European Parliament (EP) and the Council of the European Union – for their review, input and adoption. These institutions hold the power to amend the currently proposed Omnibus sustainability package.