In the rapid legislative process relating to the ‘Omnibus’ simplification text on the ‘corporate sustainability reporting’ (CSRD) and ‘corporate sustainability due diligence’ (CSDDD) directives, the various amendments proposed by the EU Council and the European Parliament give rise to concerns that the scope of the initial texts will be weakened. The European Parliament’s rapporteur on the ‘Omnibus’, Jörgen Warborn (EPP, Swedish), presented his first draft report to the members of the Committee on Legal Affairs (JURI) on Tuesday 24 June. The reception was mixed.
The rapporteur proposes to go further than the Commission in terms of simplification (see EUROPE 13659/16). “We have a lot of rules that come from good intentions, but it is not the same as good results”, he said. He stressed the need to reduce the costs for companies of complying with the CSRD and CSDDD directives.
These arguments are not at all to the taste of Lara Wolters (S&D, Dutch), who was rapporteur on the CSDDD directive. In her view, the rapporteur removes the possibility of taking serious action against non-compliance with the law. “I only hear the voice of multinationals that have everything to gain from these changes”, she criticised.
Her colleague Pascal Canfin (Renew Europe, French), who was closely involved in the negotiations on the ‘Omnibus’ legislative package, also regretted certain changes. For him, weakening the CSRD directive risks undermining its effectiveness in terms of the investment needed for the transition. “If we want to get serious about the Capital Markets Union, we need the data from the CSRD directive. Without this, there will be no increase in savings mobilisation”, he declared.
The Greens/EFA and The Left groups also regretted the large number of amendments proposed.
However, the rapporteur received the support of the PfE and ECR groups. This is “courageous and necessary work for competitiveness”, said Mario Mantovani (ECR, Italian).
Position adopted by the EU Council. The day before, on Monday 23 June, the EU Council adopted its negotiating mandate on the same text. Here too, simplification measures have been reinforced by the Member States (see EUROPE 13665/25).
On the CSRD directive, for example, the amendments remove 85% of companies from the scope of application. Only companies with an annual turnover in excess of €450 million should be affected, according to the EU Council, whereas the Commission had set the bar at €50 million (see EUROPE 13588/4). Several Member States have hailed this as a “good balance”.
As for the CSDDD directive, its content was further weakened in the home stretch. In addition to the restricted scope (see EUROPE 13665/25), the content of action plans to combat climate change is no longer subject to any constraints.
The EU Council also wants to make the obligations in terms of due diligence more flexible in the value chain, in addition to limiting them to direct commercial partners: the companies concerned should be able to concentrate on the sectors at risk, and thus no longer carry out a complete mapping, but rather a more general delimitation exercise.
In addition, the efforts made to fulfil the obligations must be based on the information available “in a reasonable manner” which may excuse cases where the information is difficult to access.
To see the EU Council’s position: https://aeur.eu/f/HJM (Original version in French by Léa Marchal with Isalia Stieffatre)