Due diligence: EU proposes cutback on obligations

EU Commission proposes reducing scope of CSRD and CSDDD, affecting fewer companies and data points. Changes await approval from Council and Parliament. We have written a briefing note on the changes to the CSRD, it is also available as a PDF.

Key points: EU Commission proposes reducing scope of CSRD and CSDDD. CSRD to apply only to companies with 1,000+ employees and €45m+ annual turnover. Number of required data points for reporting to be reduced

Why this matters: These changes could significantly reduce compliance burdens and costs for many businesses, particularly smaller and medium-sized enterprises. 

It must be emphasised that these are proposals from the Commission. They still must be considered and jointly agreed by the Council, representing Member States, and the European Parliament before the law can be changed. For now, both the CSRD and the CSDDD remain in force and need to be complied with

What might happen next: The proposals will be considered by the Council and European Parliament before any changes are implemented.

Commission documents on the proposed changes can be found here.