The European Commission proposed as part of an “omnibus” package in February 2025 to amend the CSRD to exclude businesses with fewer than 1,000 employees and a turnover below €50 million.

At present, the reporting requirements apply to large public interest entities with more than 500 employees, which are required to report this year in respect of the 2024 financial year.

Businesses with more than 250 employees or a turnover of more than €50 million were to be required to report in 2026 for the 2025 financial year.

Listed SMEs were to be required to report in 2027 for the 2026 financial year, and certain non-EU undertakings were to be required to report in 2029 for the 2028 financial year.

As well as excluding smaller companies from the CSRD, the Commission has also proposed a two-year postponement to the reporting requirements for companies which were required to report for the first time in 2026 or 2027.

The Commission has also proposed amendments to the Corporate Sustainability Due Diligence Directive (CSDDD), which was due to come into effect by July 2026, to postpone it by a year and significantly reduce the compliance requirements on effected businesses.

Ireland’s Department of Enterprise, Trade and Employment has said it will shortly amend the existing Irish legislation governing the CSRD and implement the changes as soon as they are adopted at EU level.

Minister Peter Burke said: “While the core principle of the EU’s original corporate sustainability reporting regime was well-founded in the context of the EU’s Green Deal, the level of administrative burden associated with the original CSRD was excessive, both for large companies and especially for small and medium companies.

“I strongly support the simplification and burden reduction agenda that is being led by President von der Leyen at European level, to maximise the competitiveness of businesses in the EU in the evolving global trading environment.

“These proposed changes will of course significantly help enterprise in Ireland, and most of all our SMEs.

“I will be supporting the Commission’s proposed changes at EU level, and I will be advocating for them to be agreed at the earliest opportunity, to give business the legal certainty that it needs, and so that I can prioritise implementing the changes as soon as possible in Ireland.”