On Wednesday, 4 June, EU Member States will discuss a third draft compromise proposed by the Polish Presidency of the Council of the EU on the ‘omnibus’ text that simplifies the CSDDD and the CSRD—directives on corporate sustainability reporting and due diligence. The EU27 were asked to provide precise policy guidelines on this text some time in May. However, several key elements of the directive remain undecided.
In its latest compromise—a copy of which Agence Europe received—the Polish Presidency proposes adjusting the scope of the CSRD: it suggests there be a certain amount of flexibility in ‘reporting’ for companies whose turnover is between €50 million and €450 million.
As for the CSDDD, the exact due diligence framework for companies has not yet been decided. The Polish Presidency presents two options with regard to monitoring obligations in the value chain. The first consists of maintaining the risk-based approach. Companies are expected to map risks across their entire value chain but will then be able to focus on business relationships where adverse impacts on the environment or human rights are likely to occur. The second option submitted to member countries also introduces risk mapping, but this is limited to direct business partners.
A single solution is proposed for the transition plan that companies are required to develop under both the CSDDD and the CSRD. The Polish Presidency introduces the concepts of “due diligence obligations” and “best efforts” for the implementation of these plans. Furthermore, a transition plan established for one of the directives must apply to the other, according to the Polish Presidency’s compromise.
Finally, the question of civil liability at the European level or only at the national level has not yet been decided—this part of the text is still in square brackets.
See the 29 May compromise: https://aeur.eu/f/h5g (Original version in French by Léa Marchal)