Legal development

On Board the ESG Omnibus I: Key Take-Aways for Businesses in 2026

By Sascha Arnold, Becky Clissmann, Maria-Laure Knapp and Claus Zimmermann

06 February 2026

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    The EU's Omnibus I package marks a significant milestone in efforts to consolidate and streamline the sustainability reporting and supply chain due diligence landscape, by increasing thresholds, reducing reporting obligations and adjusting due diligence requirements.

    Our Ashurst sustainability experts discussed these regulatory changes and what they mean for businesses in a webinar held on 27 January 2026. The full webinar recording is available below. And if you prefer to read through the upcoming changes, an earlier article summarizes all relevant points here.

    Below, we provide a summary of the key take-aways businesses should be considering when reassessing their exposure to the EU's sustainability regulations:

    1. CSRD

    • Assess applicability: Since reporting thresholds have increased and new exemptions have been introduced (financial holding companies, listed SME), reassess whether you still fall within the scope of CSRD.
    • Check for Member State deferral: Wave 1 companies (who have already been reporting since FY2024) will have to continue to report for FY2026 and FY2027, unless EU Member States make use of an exemption provided in the ESG Omnibus IContent Directive. Pay close attention to national implementation efforts.
    • Stay tuned: Companies remaining in-scope should continue to follow regulatory developments closely in order to be prepared for their first CSRD reporting period. Once work on the ESRS simplification has been finalized (expected within six months of the Content Directive entering into force), companies can assess opportunities to streamline their reporting systems.
    • Keep value chain cap in mind: Keep in mind that business partners may fall under the newly introduced value chain cap (limiting the amount of sustainability data they need to share) and assess how this impacts your own reporting efforts.

    2. CS3D

    • Assess applicability: Since CS3D-thresholds have increased, reassess whether you still fall within the scope of CS3D.
    • Stay tuned: Companies remaining in-scope should continue to follow regulatory developments closely and remain aware of deadlines. But the ESG Omnibus Content Directive has given everyone one more year to prepare. Use that time to familiarize yourself with the increasing focus on risk-based due diligence approach and adjust your due diligence processes accordingly.
    • Keep national legislation in mind: Companies should continue to ensure compliance with national supply chain due diligence requirements, such as the German Supply Chain Duty of Care Act, especially if those requirements go beyond the scope of CS3D.

    3. Transition Planning

    • Still relevant: Transition planning is no longer mandatory under CS3D. However, obligations related to transition planning may arise as a result of other regulation or in other contexts (e. g. public procurement rules or under finance agreements).
    • Keep national legislation in mind: Businesses should understand jurisdiction-specific obligations regarding transition plans that apply or are on the horizon.
    • Greenwashing risks: Assess the impact on greenwashing risks if transition planning is discontinued.

    4. Out of Scope Entities

    • Don´t relax (yet): Even if companies are no longer within the scope of CSRD and CS3D, businesses should assess whether they are part of a value chain where business partners require a certain standard of sustainability data to be shared and due diligence to be conducted. Notwithstanding the CSRD value chain cap, information requests may still be made by business partners.
    • Keep other reporting obligations in mind: Consider whether there are other sources for reporting and due diligence obligations outside of CSRD and CS3D which may still apply.
    • Voluntary actions: Consider whether voluntary sustainability disclosures add value to your business operations or might even be a required standard in your industry.
    • Risks don´t go away: Keep in mind that even though supply chain due diligence may no longer be required, this does not mean that violations of human rights and environmental standards no longer take place. Be conscious of these risks and the impact on your business.

    Please reach out to the contacts below if you want to discuss any of the above further.

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    This publication is a joint publication from Ashurst LLP and Ashurst Risk Advisory LLP, which are part of the Ashurst Group.

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