The European Commission has issued a legislative proposal aimed at simplifying the implementation of the Corporate Sustainability Reporting Directive (CSRD) and making it more accessible, with a view to promoting competitiveness.
At this stage, the Commission has made the following recommendations:
- The deadline for transposition by Member States would be postponed by one year to July 26, 2027, and its application to large companies (more than 5,000 employees and $1.5 billion in revenue) to July 2028.
- The obligation to assess the negative impacts of the business would be limited, with some exceptions, to direct partners.
- The obligation to terminate commercial relations in the event of negative impacts would be removed. Companies would be encouraged to opt for temporary suspension instead.
- The frequency of the required assessments would be reduced from once a year to once every five years.
- A cap would be introduced on the information that a large group can require from its SME or mid-cap partners (fewer than 500 employees), in line with the CSRD’s “value chain cap.”
- The provisions on a harmonized civil liability regime would be removed.
These proposed amendments would make the CSRD more flexible by easing obligations in the area of sustainability reporting.
