December 18, 2025

Sustainability reporting in the EU

US companies could be impacted by sustainability reporting and due diligence requirements in the EU – notably the Corporate Sustainability Reporting Directive (CSRD) and Corporate Sustainability Due Diligence Directive (CSDDD).

The EU has agreed changes to the CSRD and CSDDD, reshaping sustainability reporting and due diligence obligations. These changes reflect the EU’s broader effort to streamline and simplify sustainability requirements through an Omnibus package introduced in February 2025.

For a foundational overview of the amended CSRD and CSDDD, read our Hot Topics linked below.

For an overview of the latest developments on all the other moving parts of EU sustainability reporting, including Omnibus, continue scrolling – and regularly check the timelines below for key updates.

US companies – here’s what matters most

The EU has reached an agreement on amendments to the CSRD and CSDDD providing certainty on whether and how companies will need to comply with these requirements. This, along with EFRAG’s submission of its simplified ESRS to the EC has given greater clarity on whether companies will be in scope of the CSRD and, if so, what needs to be reported. US companies should start moving forward again by assessing how these amended scoping thresholds and reporting standards will impact their sustainability reporting strategy.

The EU has reached agreement on substantial amendments to both the CSRD and CSDDD. Most notably, the agreement increases the scoping thresholds for both directives, significantly reducing the number of companies in scope. Once published in the Official Journal of the EU, Member States will have 12 months to transpose the amendments into national law, likely until March 2027. The table below compares key elements of the CSRD and CSDDD.

EFRAG, the EU’s corporate reporting advisory board, has proposed simplified European Sustainability Reporting Standards (ESRS) and submitted them to the European Commission (EC). The EC is now proceeding with its own due process to see if more changes are needed. Our guide will help you understand the changes EFRAG has proposed and what they would mean in practice.

Here you’ll find key information to help you navigate the evolving EU sustainability reporting landscape. Use the jump links below to quickly access specific topics.

Click on the links to understand more about EU sustainability reporting.

CSRD

The CSRD, amended the Accounting Directive (2013/34/EU) – which applies to non-EU companies that meet certain employee, turnover (revenue) and/or asset thresholds – and to non-EU groups with substantial activity and a presence in the EU. In-scope companies are required to prepare sustainability reporting in accordance with the ESRS. The Accounting Directive and CSRD have been further amended by the Stop-the-clock Directive (2025/794) and Content Directive. A ‘Quick fix’ Delegated Act (2025/1416) introduced as part of the Omnibus package also impacts CSRD reporting requirements.

CSDDD

The CSDDD, (2024/1760) applies to non-EU companies that met certain revenue and/or royalty thresholds. In-scope companies are required to comply with certain due diligence obligations (including reporting and transition plan adoption) related to actual and potential adverse human rights and environmental impacts. The CSDDD has been further amended by the Stop-the-clock Directive (2025/794) and Content Directive, introduced as part of the Omnibus package.

Download our Hot Topics:

Our Hot Topics, tailored to US companies, provide information on the relevant scoping and reporting requirements, as amended by the Omnibus package.

Global implications of the Corporate Sustainability Reporting Directive

Omnibus amendments have significantly reduced the scope of the CSRD and its applicability beyond the EU.

Global implications of the Corporate Sustainability Due Diligence Directive

Omnibus amendments have significantly reduced the scope and streamlined due diligence obligations to ease burden on companies.

The Omnibus package of proposals was introduced in February 2025 to simplify and streamline certain EU legislation (including the CSRD and the CSDDD). While the amendments to the CSRD and the CSDDD have been agreed upon, there are other simplification measures which are being introduced in waves, with different parts progressing at varying speeds.

To help you stay informed, we’ve created five separate timelines – each tracking a specific piece of the Omnibus package. This approach will give you a clearer view of the distinct regulatory pieces and their unique paths forward.

Click each of the boxes below to view a timeline of what’s happened so far and what’s expected next. As legislative discussions evolve, future dates may shift, so check back regularly for the latest updates.

Hover over each of the following boxes to read the latest.

CSRD, as originally adopted: Transposition

The CSRD, as originally adopted, entered into force in January 2023. Despite the deadline of July 6, 2024 to transpose it into national law, a handful of Member States have not yet transposed.

For Wave 1 companies, these delayed transpositions continue to cause legal uncertainties relating to, for example, continued application of the sustainability reporting regime under the Non-Financial Reporting Directive (NFRD).

The CSRD, as originally adopted, entered into force in January 2023. Despite the deadline of July 6, 2024 to transpose it into national law, a handful of Member States have not yet transposed.

CSRD: Non-EU standards

Non-EU groups in scope of the CSRD are required to report in accordance with the forthcoming non-EU group standards (NESRS). The EC’s adoption deadline for the NESRS is June 30, 2026. However, a de-prioritization process proposed by the EC would further delay this timeline until at least October 2027. Certain non-EU groups would still be required to comply with the CSRD, and this delay would leave little time for them to prepare for reporting in FY2029 (based on FY2028 data).

CSRD: Guidance

EFRAG has launched an ESRS Knowledge Hub, a new digital gateway designed to help companies and stakeholders navigate the ESRS, support consistent implementation and enhance the transparency and usability of ESRS. The platform includes key ESRS-related materials, including standards, implementation guidance and supporting documents.

CSRD: VSME

The EC has adopted a recommendation on voluntary sustainability reporting for SMEs that includes a voluntary standard for SMEs (VSME). The EC is encouraging companies in scope of the CSRD to leverage this recommendation when making requests to SMEs, to the extent possible.

The EC plans to adopt a delegated act on a voluntary standard around mid-2026. Read our web article, VSME: A voluntary sustainability reporting option.

CSRD: Assurance

The CSRD requires the EC to adopt limited assurance standards by July 1, 2027.

CSDDD: Transposition

Member States have until July 26, 2028 to transpose the CSDDD into their respective national law. To avoid a fragmented regulatory landscape, a harmonization principle prohibits Member States from introducing provisions diverging from many of the due diligence obligations within the CSDDD.

CSDDD: Guidance

By March 31, 2029, the EC will establish the CSDDD report content and criteria, which are expected to align with similar reporting criteria in the CSRD.

The EC will issue guidelines to support companies in fulfilling due diligence obligations by July 26, 2027.

By March 31, 2029, the EC will establish the CSDDD report content and criteria, which are expected to align with similar reporting criteria in the CSRD.

The EC will issue guidelines to support companies in fulfilling due diligence obligations by July 26, 2027.

CSDDD: Assessments

By July 26, 2031, the EC will assess the effectiveness of certain implementation matters, including whether a scoping approach specific to high-risk sectors should be introduced and whether the value chain definition should be revised.

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ESRS Today

KPMG’s latest insights and guidance on European Sustainability Reporting Standards

Real-time ESRS

KPMG analyzed sustainability statements of 270 companies that reported under ESRS in the first half of 2025.

Bryce Ehrhardt

Managing Director, Dept. of Professional Practice, KPMG LLP

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Marissa Spencer

Director, Dept. of Professional Practice, KPMG US

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Bryce Ehrhardt

Managing Director, Dept. of Professional Practice, KPMG LLP

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Marissa Spencer

Director, Dept. of Professional Practice, KPMG US

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Sustainability reporting in the EU

EU agrees to Omnibus changes

Latest : EU agrees on Omnibus amendments and EFRAG releases simplified ESRS

Understand EU sustainability reporting

Overview of the CSRD and CSDDD

CSRD

CSDDD

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Key Omnibus milestones

Other developments

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