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MEPs back delays to sustainability rules

The European Parliament has backed a proposal from the European Commission to postpone the application dates for new laws on due diligence and sustainability-reporting requirements.

MEPs voted 531 to 69 in favour of the plans, which were announced in February as part of a wider ‘omnibus’ package of changes to the EU’s sustainability rules that it said were aimed at simplifying EU rules and boosting competitiveness.

The postponements apply to two directives: the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD).

Due-diligence measures

Member states will have an extra year – until 26 July 2027 – to transpose the CSDDD rules into national legislation.

The one-year extension will also apply to the first wave of businesses to be affected – EU companies with over 5,000 employees and net turnover higher than €1.5 billion, and non-EU companies with a turnover above this threshold in the EU. These companies will only have to apply the rules from 2028.

The CSRD will also be delayed by two years for the second and third waves of companies covered by the legislation.

Large companies with more than 250 employees will be required to report on their social and environmental measures for the first time in 2028 for the previous financial year, while listed small and medium-sized enterprises will have to provide this information one year later.

Irish legislation

MEPs had agreed to deal with the measures under the parliament’s urgent procedure to speed up their adoption. The draft law must now be formally approved by the EU Council.

Earlier this week, Peter Burke (Minister for Enterprise, Trade and Employment) said that he would be amending the existing Irish legislation governing the CSRD “shortly” to further clarify and reduce the scope of companies covered.

He added that he was also focused on quickly implementing the package of changes proposed by the commission, once they were adopted at EU level.