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REPORT (COM(2025)0081 – C100037/2025 – 2025/0045(COD))

On the proposal for a directive of the European Parliament and of the Council amending Directives 2006/43/EC, 2013/34/EU, (EU) 2022/2464 and (EU) 2024/1760 as regards certain corporate sustainability reporting and due diligence requirements

A-10-2025-0197

Committee on Legal Affairs · Rapporteur: Jörgen Warborn

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Written by a language model from the full text only; every figure comes from the text. The paragraph links open the paragraph a statement rests on — check the text itself before relying on it.

Parliament's amended version of the proposal amends corporate sustainability reporting and due diligence rules. It raises employee and turnover thresholds for reporting obligations, exempts financial holding undertakings, and adjusts due diligence requirements. It limits information requests from value chain partners, introduces voluntary reporting standards, and clarifies that reporting does not require disclosing trade secrets. For due diligence, it changes the scope to companies with over 5000 employees and EUR 1.5 billion turnover, allows prioritisation of impacts, and sets a maximum penalty of 5% of net worldwide turnover. It also requires the Commission to adopt revised sustainability reporting standards within six months and to establish a digital reporting portal.

Committee position. The Committee on Legal Affairs proposes amendments to the Commission proposal, raising thresholds for reporting and due diligence, exempting financial holdings, and adjusting due diligence requirements.

Key points

  1. Sustainability reporting obligations apply to undertakings with over 1000 employees and a net turnover over EUR 450 million, replacing the previous large undertaking criteria.
  2. Financial holding undertakings are exempted from sustainability reporting obligations.
  3. Reporting undertakings must not seek information from value chain partners with up to 1000 employees and EUR 450 million turnover beyond voluntary standards, except commonly shared sector information.
  4. Reporting obligations do not require disclosure of trade secrets as defined in Directive (EU) 2016/943.
  5. The Commission must adopt voluntary sustainability reporting standards based on Recommendation 2025/4984 within four months.
  6. The Commission must revise the first set of ESRS within six months to remove less important datapoints, prioritise quantitative indicators, and improve consistency.
  7. Due diligence obligations apply to companies with over 5000 employees and net worldwide turnover over EUR 1.5 billion, and non-EU companies with over EUR 1.5 billion turnover in the Union.
  8. Companies may prioritise the most severe and likely adverse impacts and are not penalised for harm from less significant impacts not yet addressed.
  9. Maximum pecuniary penalties for due diligence failures are set at 5% of net worldwide turnover.
  10. The Commission must establish a digital reporting portal as a one-stop-shop for companies, free of charge.
  11. The deadline for general due diligence guidelines is advanced to 26 July 2026, and application for the first group of companies is deferred to 26 July 2028.

Who is affected

  • Large undertakings and parent groups with over 1000 employees and EUR 450 million turnover face reduced reporting obligations.
  • Financial holding undertakings are exempted from sustainability reporting.
  • Companies in value chains with up to 1000 employees and EUR 450 million turnover are protected from excessive information requests.
  • Companies subject to due diligence now need over 5000 employees and EUR 1.5 billion turnover, reducing the number in scope.
  • Supervisory authorities must supervise transition plan adoption and provide advice.

Figures and deadlines

  • 1000 employees and EUR 450 000 000 net turnover thresholds for sustainability reporting.
  • 5000 employees and EUR 1.5 billion net worldwide turnover for due diligence scope.
  • 5% of net worldwide turnover as maximum pecuniary penalty.
  • 26 July 2026 deadline for general due diligence guidelines.
  • 26 July 2028 application date for first group of companies.
  • Six months after entry into force for revised ESRS.
  • Four months after entry into force for voluntary reporting standards.
  • 24 months transition period for recent acquisitions.

Legal basis: Article 294(2) and Articles 50 and 114 of the Treaty on the Functioning of the European Union