Insights · Due diligence
CSDDD and CSRD after the Omnibus: who is in scope, from when – and what remains?
What this is about
As part of the Omnibus I package, the EU has amended two key pieces of sustainability legislation: the Directive on corporate sustainability due diligence (CSDDD, Directive (EU) 2024/1760) and the Directive as regards corporate sustainability reporting (CSRD, Directive (EU) 2022/2464). The amendments are contained in Directive (EU) 2026/470, published in the Official Journal on 26 February 2026 and in force since 18 March 2026 (EUR-Lex, Directive (EU) 2026/4701).
CSDDD: much narrower scope, later application
The CSDDD will now cover only companies with more than 5,000 employees and a net worldwide turnover of more than EUR 1.5 billion; for non-EU companies, a net turnover of more than EUR 1.5 billion generated in the EU is decisive. The original thresholds were 1,000 employees and EUR 450 million turnover.
The timeline has also moved: Member States must transpose the Directive by 26 July 2028, and obligations apply uniformly from 26 July 2029 instead of the original staggered start from 2027. Reporting under Article 16 CSDDD is to apply to financial years starting on or after 1 January 2030.
The basic model remains: the CSDDD requires risk-based due diligence on human rights and environmental impacts in a company's own operations, its subsidiaries and its chain of activities. How far individual elements – such as the depth of risk identification in the supply chain or civil liability – have changed in detail should be traced in the wording of the amending Directive.
CSRD: fewer companies reporting
The CSRD will apply to undertakings with more than 1,000 employees and net turnover above EUR 450 million. For non-EU groups, it applies where the parent generates more than EUR 450 million turnover in the EU and an EU subsidiary or branch exceeds EUR 200 million. The transposition deadline for these changes is 19 March 2027.
Revised ESRS and voluntary standard
In parallel, on 3 July 2026 the Commission adopted revised European Sustainability Reporting Standards (ESRS) (European Commission, 3 July 20262). According to the Commission, mandatory datapoints fall by more than 60% and total datapoints by more than 70%. The Commission took EFRAG's technical advice into account and made its own adjustments.
It also adopted a voluntary reporting standard for smaller companies outside the CSRD. This includes a "value chain cap": companies subject to the CSRD should not be able to require more information from companies in their value chain than the voluntary standard covers (European Commission, 3 July 20263).
After the scrutiny period of Parliament and Council, both acts were published in the Official Journal as Delegated Regulations (EU) 2026/1563 (ESRS) and (EU) 2026/1560 (voluntary standard); the revised ESRS apply from financial year 2027 and may optionally be used for 2026 (EUR-Lex, Delegated Regulation (EU) 2026/15634).
What remains: the LkSG in Germany
In Germany, the German Supply Chain Due Diligence Act (LkSG) continues to apply until the CSDDD is transposed. A government bill (BT-Drs. 21/24745) would abolish the reporting obligation and limit sanctions to serious breaches, while the due diligence obligations themselves would remain. The Bundestag held a first reading on 16 January 2026 and referred the bill to committee (German Bundestag6); it has not been adopted so far. The Federal Office for Economic Affairs and Export Control (BAFA) has stopped reviewing LkSG reports, and reports can no longer be submitted (BAFA7).
What companies typically examine
- Scope: Which thresholds does the company or group meet under the new rules – separately for CSDDD, CSRD and LkSG?
- Indirect exposure: What information do customers request, and how do these requests relate to the voluntary standard?
- Existing processes: Which parts of LkSG risk management (risk analysis, grievance mechanism, preventive measures) remain necessary and can be carried over to the CSDDD?
- Timeline: Which milestones follow up to 2027 (CSRD/ESRS) and 2029 (CSDDD)?
Open points
Open points include national transposition of both directives in Germany, the outcome of the LkSG amendment procedure, and the Commission's announced guidelines on the CSDDD.
This post provides a general overview and does not replace legal advice on individual cases.