CSRD
Corporate Sustainability Reporting Directive
The CSRD is the EU’s mandatory sustainability reporting law, under which in-scope companies report against the European Sustainability Reporting Standards (ESRS) on a double-materiality basis. Its scope was significantly narrowed by the 2025–2026 EU "Omnibus" simplification: from financial years beginning on or after 1 January 2027, mandatory reporting applies mainly to companies with more than 1,000 employees and over €450 million net turnover.
| Publisher | EU / EFRAG (ESRS) |
|---|---|
| Basis | Double materiality |
| Status | Mandatory; scope narrowed by Omnibus (2026) |
| Main threshold | >1,000 employees & >€450m turnover |
| Applies from | FY starting on/after 1 Jan 2027 |
Who reports under it
After the Omnibus reforms, mainly large EU companies (and large non-EU groups with significant EU activity) above roughly 1,000 employees and €450 million turnover. Most SMEs — including listed SMEs, which the Omnibus removed from mandatory scope — are no longer directly required to report, but still feel the CSRD indirectly through data requests from in-scope customers, which is exactly what VSME is designed to answer.
Who reports after the Omnibus
Large companies previously covered by the NFRD that still meet the new size thresholds continue reporting against the ESRS.
Companies above ~1,000 employees and €450m turnover are phased in for financial years beginning on or after 1 January 2027.
The Omnibus removed listed SMEs from mandatory scope; SMEs respond to value-chain requests via the voluntary VSME standard instead.
CSRD and SMEs: the value-chain effect
Even though most SMEs are now out of direct scope, CSRD still reaches them through customers. In-scope companies report on their value chain, so they ask suppliers for emissions and ESG data. The Omnibus also introduced a "value-chain cap" limiting what large companies can demand from smaller suppliers to roughly the VSME data points — making VSME the practical standard for answering these requests.
What the Omnibus changed
The EU’s Omnibus I package — agreed in December 2025 and adopted in early 2026 — raised the size thresholds, delayed later reporting waves ("stop the clock"), removed listed SMEs from mandatory scope, and triggered a simplification of the ESRS by EFRAG. Implementation is still settling, so always check the current rules.
Frequently asked questions
Does the CSRD apply to SMEs?
After the 2025–2026 Omnibus reforms, most SMEs are not in mandatory scope — listed SMEs were removed and the main threshold rose to about 1,000 employees and €450m turnover. SMEs typically respond to CSRD-driven value-chain requests using the voluntary VSME standard.
What is double materiality?
Double materiality means reporting both how sustainability issues affect your business (financial materiality) and how your business affects people and the environment (impact materiality).
When does the CSRD apply after the Omnibus?
The narrowed scope applies for financial years beginning on or after 1 January 2027, while companies already reporting under the former NFRD continue in the meantime. Timelines may still be refined, so verify the current dates.
How Clidapt helps
Clidapt supports CSRD reporting: Scope 1, 2 and 3 accounting on the GHG Protocol, AI-assisted disclosures, completeness tracking, and audit-ready PDF/CSV export.