"Council and Parliament strike a deal to simplify sustainability reporting and due diligence requirements and boost EU competitiveness", 9 December 2025

Today, the Council’s presidency and European Parliament’s negotiators reached a provisional agreement to simplify sustainability reporting and due diligence requirements to boost EU competitiveness. The agreement simplifies the directives on corporate sustainability reporting (CSRD) and corporate sustainability due diligence (CS3D) by reducing the reporting burden and limiting the trickle-down effect of obligations on smaller companies.

On the CSRD, the Commission proposed to increase the employee threshold to 1000 employees and to remove listed SMEs from the scope of the directive. In the provisional agreement, the co-legislators added a net turnover threshold of over €450 million to further alleviate the reporting burden on undertakings.

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Finally, the provisional agreement introduces a review clause concerning a possible extension of the scope for both CSRD and CSDDD.

Finally, the provisional agreement postpones the CS3D’s transposition deadline by another year, to 26 July 2028. Companies will have to comply with the new measures by July 2029.

The provisional agreement must be now endorsed by the Council and the European Parliament. before it is formally adopted by the two institutions.