The Corporate Sustainability Reporting Directive (CSRD) is the EU law that turns sustainability disclosure from a voluntary exercise into a regulated reporting obligation for thousands of companies. It replaces the old Non-Financial Reporting Directive (NFRD) with clearer rules, mandatory European Sustainability Reporting Standards (ESRS), and digital reporting requirements.
If you operate in Europe, sell to CSRD reporters, or raise capital from ESG-focused investors, CSRD shapes what data you need, how you collect it, and when you must publish it. This guide explains what changed after Omnibus I, who is still in scope, and how to prepare without rebuilding your data every year.
What is the CSRD and why does it matter?
The CSRD requires companies to publish structured sustainability information alongside financial statements. Reports must cover environmental, social and governance topics based on a double materiality assessment: how the company affects people and the planet, and how sustainability issues affect the business.
The directive aims to:
- Give investors, banks and customers comparable, audited data
- Help companies manage climate and social risks before they hit the balance sheet
- Align EU reporting with global expectations on transparency and accountability
CSRD does not replace other frameworks overnight. It sets the legal floor in the EU. Companies still use GHG Protocol for emissions, may reference GRI in methodology notes, and must map disclosures to ESRS when in scope.
For a deeper look at materiality, see our double materiality guide.
Not sure if CSRD applies to your group after Omnibus I? We can walk through your thresholds in a short demo.
Talk to our teamWho needs to comply after Omnibus I?
Important update: Omnibus I (Directive (EU) 2026/470) entered into force on 18 March 2026. It sharply reduced CSRD scope. The old figure of ~49,000 companies no longer applies.
Under the revised rules, a company is generally in scope only if it meets both:
- More than 1,000 employees, and
- Net annual turnover above €450 million
That dual threshold cuts the estimated reporting population to roughly 5,000 companies across the EU. The previous criteria (250+ employees and €50 million turnover) are outdated for mandatory CSRD reporting.
Other entities to watch
- Listed SMEs that were in wave 3 under the original calendar are largely out of mandatory CSRD scope under Omnibus I, but may still face market pressure to report.
- Non-EU groups with significant EU presence may still need to report if the parent exceeds €450 million EU net turnover (with subsidiary/branch turnover thresholds also applying).
- Wave 1 companies that already reported for FY2024 but now fall below the new thresholds may qualify for a transition exemption in 2025 and 2026, depending on how each Member State transposes the directive.
Tip: Check both thresholds, not just headcount. A company with 1,200 employees and €400 million turnover was in scope under the old rules but is out of scope under Omnibus I because turnover is below €450 million.
Out of scope does not mean out of pressure
Even if CSRD no longer binds you legally, banks, investors and large customers will keep asking for ESG data. The voluntary VSME standard is becoming the practical reference for SMEs in supply chains. Building a lightweight data process now avoids scrambling when the next client sends a questionnaire.
How CSRD reporting works in practice
Compliance is not a single PDF at year-end. It is a year-round data process tied to ESRS disclosures, assurance and digital submission.
1. Run a double materiality assessment
Identify which ESRS topics are material (climate, own workforce, pollution, biodiversity, business conduct, etc.). Document stakeholder input, scoring and board approval. This step defines what you must report, not everything under the sun.
2. Build your ESRS datapoint inventory
Map each material topic to required datapoints. After Omnibus I, mandatory ESRS datapoints drop from 1,073 to 320, but the remaining set still demands traceable evidence, especially on climate (E1) and social topics where material.
3. Collect data with clear ownership
Operational teams, HR, procurement and finance all hold pieces of the picture. Assign owners, validation rules and collection cadence. Spreadsheets alone rarely survive assurance.
4. Prepare for limited assurance
CSRD requires limited assurance on sustainability statements. Reasonable assurance was dropped under Omnibus I. Auditors will test methodology, boundaries and evidence links, not just final numbers.
5. Publish in digital format
Reports must be tagged for European Single Electronic Format (ESEF) interoperability. Plan for structured export early, not the week before filing.
Tip: Start with one material topic and one complete evidence chain (source → calculation → ESRS disclosure). If that path works in a pilot, scaling to the full statement is far easier than fixing gaps under audit pressure.
Key dates after Omnibus I
| Milestone | When |
|---|---|
| Omnibus I entry into force | 18 March 2026 |
| Simplified ESRS delegated act (expected) | June 2026 |
| New CSRD scope applies (FY starting on or after 1 Jan 2027) | From 2027 |
| Member State transposition deadline | 19 March 2027 |
Companies that remain in scope should use 2026 to recalibrate materiality and data collection against the reduced ESRS set. Those newly out of scope should decide whether to maintain reporting for stakeholders or adopt VSME for supply chain requests.
Explore timelines and obligations in our CSRD resource hub.
What CSRD means for investors, customers and suppliers
Investors get standardized, assured sustainability data in annual reports, improving comparability across portfolios.
Customers and consumers can see whether claims on climate, workforce or governance are backed by disclosed metrics, not marketing alone.
Suppliers face more structured data requests from in-scope clients, especially on Scope 3 and social indicators. Omnibus I adds supplier protection rules: smaller firms may decline requests beyond VSME unless larger clients have exhausted other options.
The regulatory burden may have shrunk for many companies, but stakeholder expectations have not. Treat CSRD as one driver of a broader ESG data strategy, not the only reason to measure impact.
How to comply without rebuilding every cycle
The hardest part is not writing the report. It is keeping data current, traceable and reusable across CSRD, carbon footprint, taxonomies and customer questionnaires.
A practical approach:
- Centralize ESG inputs in one governed dataset (sites, energy, travel, procurement, HR metrics).
- Document methodology once (boundaries, emission factors, estimation rules) and version changes.
- Link evidence to each indicator so assurance and internal review are repeatable.
- Reuse the same base for related outputs instead of parallel Excel chains.
Dcycle is built for that model: collect once, map to ESRS and other frameworks, and maintain audit trails without treating each deadline as a new project.
See how Dcycle connects CSRD datapoints to the evidence your auditors expect.
See the demoDcycle: your partner for CSRD readiness
Dcycle is an ESG data platform, not an audit firm. We help companies:
- Centralize environmental, social and governance data from ERP, operations and suppliers
- Map material topics to ESRS and related frameworks from one source
- Automate collection workflows and keep methodology documentation versioned
- Export structured reporting outputs ready for review and assurance
Whether you remain in CSRD scope after Omnibus I or need to respond to clients who do, the goal is the same: credible data, less manual rework, faster cycles.
Ready to prepare CSRD reporting with traceable data from day one?
Request a demoFrequently Asked Questions (FAQs)
What is the difference between CSRD and ESRS?
CSRD is the EU law that requires sustainability reporting. ESRS are the standards that define what to disclose and how to structure the statement. You comply with CSRD by reporting against the ESRS topics that are material to your business.
Does CSRD still apply to companies with 250 employees?
Not under Omnibus I. Mandatory CSRD scope now generally requires more than 1,000 employees and more than €450 million turnover. Smaller companies may still report voluntarily or because customers request VSME-aligned data.
When do the new CSRD rules apply?
Omnibus I entered into force on 18 March 2026. The revised scope applies to financial years starting on or after 1 January 2027, with Member States transposing by 19 March 2027. Companies that reported under wave 1 but fall out of scope may have transitional relief in 2025 and 2026, depending on national implementation.
Is CSRD assurance still required?
Yes. Limited assurance on the sustainability statement remains mandatory for companies in scope. The move to reasonable assurance was removed under Omnibus I, but auditors will still test data quality and evidence.
What should we do if we are no longer in CSRD scope?
Confirm both thresholds, monitor your Member State’s transposition, and decide whether to maintain reporting for investors and clients. Many companies use the VSME standard for lighter disclosure. Avoid deleting data infrastructure; regulatory scope has expanded before and stakeholder requests continue regardless of legal obligation.