EU sustainability reporting · the Directive
CSRD: the Corporate Sustainability Reporting Directive
The CSRD is the EU law that makes the largest companies publish an assured sustainability statement in their management report, under the European Sustainability Reporting Standards.
Omnibus I, Directive (EU) 2026/470, cut its scope to companies exceeding both 1,000 employees and €450 million of net turnover, from financial year 2027.
It is not UK law, but it reaches UK groups through EU subsidiaries, EU listings, Article 40a and the questionnaires of EU customers.
The basics
What the CSRD is, and where its rules live
The CSRD is Directive (EU) 2022/2464, adopted on 14 December 2022.
It is an amending directive: it rewrote the sustainability provisions that the old Non-Financial Reporting Directive had first inserted into the EU Accounting Directive, Directive 2013/34/EU.
So the rules a company follows today are read in the consolidated Accounting Directive, mainly Article 19a for an undertaking and Article 29a for a group.
The core duty is short.
An in-scope company includes in its management report the information needed to understand its impacts on sustainability matters, and how sustainability matters affect its development, performance and position.
That two-way test is double materiality, explained on our double materiality page.
The information is prepared under the ESRS, and an auditor or another permitted provider gives a limited assurance opinion on it.
A CSRD report is therefore not a separate glossy document: it is a sustainability statement inside the annual management report, published with the financial statements.
The Commission’s CSRD page describes the aim as helping investors, civil society and others evaluate companies’ sustainability performance.
The CSRD is not the same thing as ESG: it uses its own term, “sustainability matters”, which Article 2(17) of the Accounting Directive defines as environmental, social and human rights, and governance factors.
| The CSRD | |
|---|---|
| Full name | Corporate Sustainability Reporting Directive |
| Instrument | Directive (EU) 2022/2464, amending Directive 2013/34/EU |
| Amended by | Directive (EU) 2025/794 and Directive (EU) 2026/470 |
| Where the report goes | A dedicated section of the management report |
| Standard | European Sustainability Reporting Standards (ESRS) |
| Materiality | Double: impact and financial |
| Assurance | Limited assurance opinion |
UK angle
Does the CSRD apply in the UK? Four routes in
Not as UK law: the UK left the EU before the CSRD was adopted, so it was never transposed here.
What matters for a UK group is where its entities sit and where its securities trade.
The first route is an EU subsidiary, or an EU sub-group parent, that exceeds both thresholds on its own figures.
The second is securities admitted to an EU regulated market; Omnibus I recital 7 applies the same thresholds to issuers.
The third is Article 40a, the group-level report for a non-EU parent with large EU turnover, from financial year 2028.
The fourth is the value chain: EU reporters need data from suppliers, and send questionnaires.
The last route touches the most UK businesses, and from 2027 those requests are limited by the value-chain cap described below.
The checker beside this text asks which route you are standing in; our guide to CSRD reporting for UK companies works through each one, and CSRD in the UK set against UK SRS covers what each regime asks.
| Route | Test after Omnibus I | First financial year |
|---|---|---|
| EU subsidiary or EU sub-group | More than 1,000 employees and more than €450m net turnover, individually or consolidated | FY2027, unless already a wave one reporter |
| Securities on an EU regulated market | The same thresholds apply to issuers | FY2027, unless already a wave one reporter |
| Article 40a group report | More than €450m EU net turnover in each of the last two years, plus an EU subsidiary or branch above €200m | FY2028, published 2029 |
| Value-chain requests | No legal duty; a protected supplier may decline requests beyond the cap | Cap applies from FY2027 |
CSRD · which route are you in?
Pick the position that fits.
A UK group can stand in more than one: test each EU subsidiary on its own figures and the whole group under Article 40a.
Rules: Directive 2013/34/EU Arts 19a, 29a and 40a and Directive (EU) 2022/2464 Art 5, as amended by Directive (EU) 2026/470.
“Exceed” is strict and both limbs are needed.
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A provisional reading, not advice on your group perimeter.
Scope
Who the CSRD covers after Omnibus I
Article 19a(1) now applies to undertakings which “exceed a net turnover of EUR 450 000 000 and an average number of 1 000 employees during the financial year”.
The test is cumulative, and “exceed” is strict.
| Who | Reporting requirement from FY2027 |
|---|---|
| EU undertaking | Individual sustainability statement if it exceeds both 1,000 employees and €450m net turnover (Art 19a) |
| EU parent of a group | Consolidated sustainability statement if the group exceeds both thresholds (Art 29a) |
| EU-listed issuer | The same thresholds; listed SMEs are no longer in scope and the listed-SME standard (Art 29c) is deleted |
| Insurers and credit institutions | In scope regardless of legal form, but only above both thresholds |
| Financial holding undertakings | May leave the information out of the consolidated report where subsidiaries’ business models are independent (Art 29a(7a)) |
| Non-EU group (Art 40a) | Group-level report via the EU subsidiary or branch from FY2028 |
| Everyone else | Out of scope; may report voluntarily, for example under the voluntary standard |
The 6,753 counts only companies that remain in scope after the change, so it is not the pre-Omnibus population.
The test is an AND: a company with 3,000 employees and €300 million turnover is out, and so is one with €2 billion turnover and 800 employees.
Two reference periods sit side by side and are easy to mix up.
The scope test counts average employees “during the financial year” being reported on.
The value-chain cap, which protects smaller suppliers, counts average employees during the preceding financial year.
A company can therefore sit on different sides of the 1,000 line for the two purposes in the same year.
The balance sheet no longer counts for anything: the old size test that used it is shown in the next section.
What changed
Before and after Omnibus I
Most CSRD guidance published before March 2026 describes a scope that no longer applies.
The left column is history, kept so it can be recognised.
| Area | Before (no longer applies) | After Omnibus I |
|---|---|---|
| EU company test | Large: exceeding two of €25m balance sheet, €50m net turnover and 250 employees (Art 3(4)); plus listed SMEs | More than 1,000 employees AND more than €450m net turnover |
| Timing | Wave two from FY2025, moved to FY2027 by Stop-the-Clock; wave three to FY2028 | One test from FY2027; wave one limited to FY2024–FY2026 unless still above it |
| Non-EU groups (Art 40a) | More than €150m EU turnover, with a large or listed EU subsidiary or a branch above €40m | More than €450m EU turnover in each of the last two years, with an EU subsidiary or branch above €200m |
| Value-chain requests | No statutory limit | Cap for undertakings with 1,000 employees or fewer |
| Assurance | Limited, with a power to move to reasonable assurance | Limited only; the reasonable-assurance power is deleted |
| Sector-specific ESRS | Commission empowered to adopt them | Empowerment deleted |
The package began as a Commission proposal on 26 February 2025.
While it was negotiated, the Stop-the-Clock Directive (EU) 2025/794 of 14 April 2025 postponed waves two and three by two years.
Omnibus I was then adopted on 24 February 2026, published in the Official Journal on 26 February 2026 and in force from 18 March 2026.
The “1,750 employees” figure that circulated after the December 2025 political agreement is not in the adopted text.
Recital 7 states the policy in one sentence: individual reporting “should be limited to undertakings with a net turnover exceeding EUR 450 000 000 and an average of more than 1 000 employees during the financial year”.
Is the CSRD still applicable, then?
Yes: as Dechert’s September 2026 briefing puts it, reporting is now essentially limited to large EU undertakings and issuers and to large non-EU groups with significant EU activity.
The full change log, with the Member State options for 2025 and 2026, is on CSRD after Omnibus I.
UK groups
What a UK parent with an EU subsidiary actually files
A UK parent is not itself subject to Article 19a.
The duty falls on EU entities, so the question is which EU entity files, what, for which year, and whether a group report can stand in for it.
| Question | Answer in the consolidated Accounting Directive |
|---|---|
| Which entity | Each EU subsidiary exceeding both limbs on its own (Art 19a), and each EU parent of an EU sub-group exceeding them on a consolidated basis (Art 29a) |
| Which report | A sustainability statement in a dedicated section of that entity’s management report, under the ESRS, with a limited assurance opinion |
| Which year | Financial years beginning on or after 1 January 2027, reported in 2028, unless it is already a wave one reporter |
| Where it is published | With the management report under Article 30, in the Member State where the entity is incorporated |
| Group route | The Article 19a(9) exemption, where a consolidated report covers the subsidiary and the conditions are met |
| Separately, from FY2028 | The Article 40a group-level report, published through the EU subsidiary or branch |
The consolidated-report exemption
Article 19a(9) exempts a subsidiary from its own statement where it and its subsidiaries are included in a parent’s consolidated sustainability reporting.
For a parent outside the EU, that reporting must be prepared under the ESRS or in a manner the Commission has determined equivalent.
A UK parent that reports only under UK SRS can use the route only if such a determination covers UK SRS, so check before relying on it.
The exempt subsidiary names the parent in its own management report, links to the parent’s report and assurance opinion, states that it is exempt, and still carries its Taxonomy Article 8 disclosures, in its own report or the parent’s.
Article 48i adds a second route until 6 January 2030: Member States must let one EU subsidiary prepare consolidated sustainability reporting covering all the group’s EU subsidiaries that are in scope.
That subsidiary must be one of those with the greatest EU turnover in at least one of the preceding five financial years.
A worked example
Take an illustrative UK group with two EU subsidiaries in financial year 2027: a German company with 1,400 average employees and €620 million net turnover, and a French company with 300 employees and €90 million.
Group net turnover generated in the EU was €710 million in each of 2026 and 2027.
| Test | Figures | Result |
|---|---|---|
| German subsidiary, Art 19a(1) | 1,400 > 1,000 and €620m > €450m | In scope from FY2027; statement in its 2028 management report |
| French subsidiary, Art 19a(1) | 300 employees, €90m | Out of scope; a protected undertaking for its customers’ requests |
| Exemption for the German company | Needs a group report under the ESRS or an equivalent standard | Available only if the UK parent reports that way; otherwise it files its own |
| Group, Art 40a(1) | €710m > €450m in each of two years; German subsidiary above €200m | Group report through the German subsidiary from FY2028, published 2029 |
The two duties stack: from FY2027 the German company reports on itself, and from FY2028 it also publishes the Article 40a report on the whole group.
A group that wants one report rather than two should decide early whether to prepare consolidated ESRS reporting at the top.
The standards
ESRS: what the report contains
The CSRD sets the duty; the ESRS set the content.
The first set was Delegated Regulation (EU) 2023/2772.
The revised set, Delegated Regulation (EU) 2026/1563, was adopted on 3 July 2026, published in the Official Journal on 21 September 2026, enters into force on 10 November 2026 and applies to financial years beginning on or after 1 January 2027.
Entry into force is not application: nothing in the revised standards is mandatory before financial year 2027.
For financial year 2026 a company chooses between the 2023 standards as amended by Delegated Regulation (EU) 2025/1416, those standards with eight named reliefs, or the revised set in full, and its statement must say which.
The eight reliefs include the top-down materiality approach, a value-chain limitation and Taxonomy disclosures in a separate appendix, as Linklaters’ note on the Official Journal publication summarises.
The structure survives: two cross-cutting standards and ten topical ones, with E3 now titled simply “Water”.
The Commission says the revision cuts mandatory datapoints by over 60% and total datapoints by more than 70%; the 61% often quoted is EFRAG’s measure of its own draft.
No absolute datapoint count has a Commission source, so none is printed here.
Inside the standards, revised ESRS 1 paragraph 24 says a company “shall not” disclose information that is not material, and ESRS 2 adds GOV-4 on internal controls over sustainability reporting and BP-2 on phasing-in options.
The GHG boundary may follow either the financial control or the operational control approach.
The separate anticipated-financial-effects disclosures in E2 to E5 are gone; E1 keeps a reduced climate version, with time-limited reliefs that BSI’s note on E1 applicability and the transitional reliefs walks through.
No sector-specific ESRS are coming: Omnibus I deleted the power to adopt them.
Each standard is set out on our ESRS guide.
| Standard | Title in DR (EU) 2026/1563 |
|---|---|
| ESRS 1 | General Requirements |
| ESRS 2 | General Disclosures |
| ESRS E1 | Climate Change |
| ESRS E2 | Pollution |
| ESRS E3 | Water |
| ESRS E4 | Biodiversity and Ecosystems |
| ESRS E5 | Resource Use and Circular Economy |
| ESRS S1 | Own Workforce |
| ESRS S2 | Workers in the Value Chain |
| ESRS S3 | Affected Communities |
| ESRS S4 | Consumers and End-users |
| ESRS G1 | Business Conduct |
Inside the statement
What a CSRD sustainability statement contains
Every reporter applies ESRS 2, the general disclosures.
The topical standards apply only to the topics its materiality assessment finds material, and immaterial information “shall not” be disclosed.
| ESRS 2 disclosure | What it asks for |
|---|---|
| BP-1 | The basis for preparation: consolidated or individual, how far the value chain is covered, and any option or relief used |
| BP-2 | Phasing-in options used, where the company takes them |
| GOV-1 to GOV-3 | The governance bodies, how they are informed about sustainability matters, and any incentive schemes linked to them |
| GOV-4 | Risk management and internal controls over sustainability reporting — new in the revised set |
| SBM-1 to SBM-3 | Strategy, business model and value chain; the interests and views of stakeholders; the material impacts, risks and opportunities and their effects |
| IRO-1 | The process used to identify and assess impacts, risks and opportunities, and when the assessment was last updated |
| IRO-2 | The disclosure requirements complied with, and the basis for concluding that climate change is not material where E1 is omitted |
For each material topic the company then reports its policies, actions, metrics and targets against four minimum disclosure requirements, GDR-P, GDR-A, GDR-M and GDR-T.
Where it has no policy, action or target for a material topic, it says so.
Climate is treated differently: a company that omits E1 must explain why climate change is not material, and ESRS 2 forbids boilerplate in describing the process.
The E1 transition-plan disclosure follows the same pattern: describe the plan’s key features, or state that there is none and whether and when one is expected.
So the CSRD does not require a transition plan; it requires a company to say whether it has one.
Reliefs that shape the first reports
The revised ESRS phase some disclosures in.
Anticipated financial effects are the clearest case: a company may omit them for its early years, and the quantitative part for longer, except for a few E1 datapoints the standard keeps from the start.
Value-chain information has its own relief in the Directive itself.
For its first three years of reporting, a company that cannot get all the value-chain information it needs explains the efforts it made; after that it uses information from the value chain or estimates.
The value-chain cap also binds the Commission: Article 29b(4) forbids the standards from specifying disclosures that would require a company to obtain more from a protected undertaking than the voluntary standard sets.
For FY2026 alone, a company still on the 2023 standards may take eight named reliefs from the revised set: the top-down materiality approach, undue cost and effort and the value-chain limitation, acquisitions and disposals, metrics for non-significant activities, partial value-chain scope, joint operations, Taxonomy disclosures in a separate appendix, and an executive summary.
Which version it applied must be stated in the statement itself.
Digital tagging and publication
The statement is to be marked up in a machine-readable format under Article 29d once the mark-up rules are adopted in Delegated Regulation (EU) 2019/815; Omnibus I’s recital 24 says companies should not be required to mark up before then.
It is published with the management report and the assurance opinion, under the Member State’s ordinary rules for publishing annual reports.
Materiality
Double materiality under the CSRD
Double materiality is what most distinguishes CSRD reporting from the UK and ISSB standards.
A topic is material if it passes either test.
Impact materiality asks whether the company has material actual or potential impacts on people or the environment.
Financial materiality asks whether the topic triggers, or could reasonably be expected to trigger, material financial effects on the company.
The revised ESRS change how the assessment is run.
ESRS 1 paragraph 27 lets a company conclude on a topic top-down, from an analysis of its strategy and business model, without assessing each impact, risk and opportunity — and it must fall back to a specific assessment where the answer is not evident.
The bottom-up approach survives, and the two may be combined topic by topic.
Severity drives impact materiality: scale, scope and irremediable character, with severity taking precedence over likelihood for a potential human rights impact (ESRS 1 paragraph 40).
How to run the assessment is on the double materiality assessment.
Assurance and the value chain
Limited assurance, and a cap on what suppliers owe
CSRD assurance is limited assurance.
Omnibus I deleted the power to adopt reasonable assurance standards, and moved the Commission’s deadline for limited assurance standards to 1 July 2027.
The default provider is the statutory auditor; a Member State may also allow another auditor or an accredited independent assurance services provider.
See sustainability assurance for how that compares with the UK, where assurance of a UK SRS report is not required.
One limb protects suppliers: Article 34(2a) requires the opinion to be prepared in a manner that fully respects a protected supplier’s right to decline.
A protected undertaking is one with an average of 1,000 employees or fewer in the preceding financial year that sits in a reporter’s value chain.
From financial years beginning on or after 1 January 2027, a reporter may not require it to provide more than the datapoints in Annex II of the voluntary standard, Delegated Regulation (EU) 2026/1560.
The reporter may still ask, but must flag the excess and the right to decline; a contrary contract term is not binding; and the reporter may rely on the supplier’s self-declaration of size.
The Commission’s value-chain cap explanation is explicit that the cap applies only to CSRD reporting requests.
Due diligence requests under the CSDDD are outside it, and UK suppliers can work from the standard described on our VSME page.
| What the opinion covers | What the provider will look for |
|---|---|
| Compliance with the ESRS | The statement against the version applied; for FY2026, the sentence saying which |
| The materiality process | How the company identified what it reports, including any top-down conclusion |
| Taxonomy Article 8 | The Taxonomy disclosures, inside the same opinion |
| Digital mark-up | Tagging under Article 29d, once the mark-up rules are adopted |
| Value-chain information | How it was obtained or estimated; in the first three years, the efforts made where it was not available |
| Omissions | The case for anything left out as seriously prejudicial, which Article 19a(3) allows only in exceptional cases |
Non-EU groups
Article 40a: the CSRD for non-EU groups
Article 40a catches the global group, not just its EU entities.
A non-EU parent is in scope if its group generated more than €450 million of net turnover in the EU in each of the last two consecutive financial years, and it has an EU subsidiary or EU branch with net turnover above €200 million.
A branch reports only where there is no qualifying subsidiary, and the €200 million test reads the subsidiary’s or branch’s turnover in the preceding financial year.
The EU subsidiary or branch then publishes a sustainability report covering the group.
Reporting starts with financial years beginning on or after 1 January 2028, with reports in 2029.
Its standard is being drafted by EFRAG as ESRS-40a; the exposure draft’s basis for conclusions says technical advice will reach the Commission in January 2027, and the consultation closes on 31 October 2026.
The draft covers impacts only, without the financial-materiality limb.
Where the non-EU parent is a financial holding undertaking whose subsidiaries’ business models are independent of one another, Member States must let its EU subsidiaries and branches decide not to publish the Article 40a report.
The UK parent’s view of the test is on our ESRS-40a guide.
Article 40a · scope check · € millions
No answer without the EU-generated turnover figures
Limb 1 is the whole of the first question: net turnover generated in the Union, at group level, for each of the last two financial years.
Most consolidated accounts do not present that number, because "EMEA" or "Europe" is not the Union.
Producing it is the first piece of work.
Rule: Directive 2013/34/EU Art 40a(1), as amended by Directive (EU) 2026/470 Art 2(13).
“Exceeding” is strict: €450.0m is not over the line.
A provisional reading of published thresholds, not a determination for your group.
Comparison
CSRD and UK SRS
The UK has no directive like the CSRD.
Its nearest instrument is a pair of standards, now attached to the listing rules by the FCA.
| EU CSRD | UK SRS | |
|---|---|---|
| What it is | An EU directive, transposed into national law | Two standards published by DBT on 25 February 2026 |
| Who must use it | EU undertakings and issuers above 1,000 employees and €450m; Art 40a groups from FY2028 | Listed companies in UKLR 6, 14, 15, 16 and 22, on a comply-or-explain basis; voluntary for everyone else |
| From | Financial years beginning on or after 1 January 2027 for the new scope | Accounting periods beginning on or after 1 January 2027, first reports in 2028 |
| Standards | ESRS: two cross-cutting, ten topical | UK SRS S1 (general) and S2 (climate) |
| Materiality | Double: impact and financial | Single: what could influence primary users of general purpose financial reports |
| Assurance | Limited assurance required | Not required; where obtained, the provider, scope and standard are named |
The Department for Business and Trade published UK SRS S1 and S2 on 25 February 2026 for voluntary use.
The FCA’s final rules, PS26/19 of 30 September 2026, require listed companies in scope to report against UK SRS on a comply-or-explain basis for accounting periods beginning on or after 1 January 2027.
They finalise consultation CP26/5, which had proposed a mandatory S2; the final rules put all of UK SRS on comply or explain.
A group reporting under both will find the financial-materiality definitions aligned and the range of topics very different.
Our side-by-side of the two regimes is CSRD vs UK SRS, the reverse gap analysis is ESRS vs UK SRS from an ESRS statement, and the UK pair is set out on UK SRS S1 and S2.
Check your understanding
CSRD myths, checked against the text
Most CSRD errors come from three habits: reading guidance written before March 2026, treating an entry-into-force date as an application date, and assuming an EU law reaches a UK company directly.
Five mistakes recur in UK group plans.
Testing only the group: each EU subsidiary is tested on its own figures under Article 19a, as well as the group under Article 40a.
Reading two of three: the old large-undertaking test no longer sets scope.
Assuming a UK SRS report exempts the EU subsidiary: the Article 19a(9) route needs ESRS reporting or a standard determined equivalent.
Planning for reasonable assurance: the power was deleted, so plan for limited assurance and its evidence.
Treating every supplier request as capped: only CSRD reporting requests are capped, and only for suppliers with 1,000 employees or fewer.
CSRD: true or false?
The CSRD applies to all UK companies.
The revised ESRS are mandatory for financial years beginning in 2026.
A company with 3,000 employees and €300 million turnover is in scope after Omnibus I.
CSRD assurance moves to reasonable assurance in 2028.
The value-chain cap does not cover due diligence requests.
Omnibus I repealed the CSRD.
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What the CSRD means for your organisation
The same rules land differently depending on where you sit.
Each panel says what applies, what to do next and by when.
UK group with an EU subsidiary
What applies. Each EU subsidiary, or EU sub-group parent, is tested on its own figures: more than 1,000 employees and more than €450m net turnover.
The group is tested separately under Article 40a.
What to do. List every EU entity with its headcount and turnover, decide whether each reports itself or relies on a consolidated report under Article 19a(9), and check the transposing law where it is incorporated.
When. FY2027 for a subsidiary newly in scope, reported in 2028; FY2028 for an Article 40a report, published in 2029.
EU-listed issuer
What applies. The same two limbs.
Listed SMEs are no longer in scope, and the listed-SME standard was deleted.
What to do. Test the issuer on both limbs.
A wave-one reporter chooses its ESRS version for FY2026 and states the choice in the statement.
When. FY2026: version stated.
FY2027: revised ESRS mandatory.
A UK listing adds the FCA’s UK SRS statement — see ESRS vs UK SRS.
UK supplier or SME
What applies. No CSRD duty of its own.
With 1,000 employees or fewer in the preceding financial year it is a protected undertaking in a reporter’s value chain.
What to do. Ask why the customer wants the data, self-declare as protected, and sort each question into inside or outside the voluntary standard’s capped datapoints.
When. The cap applies to financial years beginning on or after 1 January 2027; Member States transpose it by 19 March 2027.
Timeline
From wave one to Article 40a
The original CSRD phased reporting in by wave.
Stop-the-Clock postponed waves two and three, and Omnibus I replaced the waves with one test from financial year 2027, limiting the wave-one rules to FY2024 to FY2026.
A wave-one company below the new thresholds falls out of mandatory scope from FY2027, and for FY2025 and FY2026 its Member State may exempt it — a national choice explained on CSRD after Omnibus I.
Transposition is at an early stage.
The EUR-Lex national transposition page for Omnibus I, read on 28 September 2026, lists measures from four Member States — Belgium, Croatia, Poland and Finland — and none from the other 23.
That is not lateness: the deadline is 19 March 2027.
National law decides the final position for any EU entity, so check the Member State where your subsidiary is incorporated; the Linklaters transposition tracker is a detailed public summary, to be confirmed against each Member State’s own gazette.
The delegated acts need no transposition: they are regulations, directly applicable.
If your group’s position turns on facts a checker cannot see, put it to the member agent after creating a free account, or book a free 15-minute call.
- 16 Dec 2022CSRD published
Directive (EU) 2022/2464 in the Official Journal.
- FY2024Wave one starts
Large public-interest entities with more than 500 employees; first reports in 2025.
- 16 Apr 2025Stop-the-Clock
Wave two moved to FY2027, wave three to FY2028.
- 18 Mar 2026Omnibus I in force
Scope narrowed to 1,000 employees and €450m.
- 21 Sep 2026Revised ESRS published
Delegated Regulations (EU) 2026/1563 and 2026/1560.
- 31 Oct 2026ESRS-40a consultation closes
EFRAG’s exposure draft for Article 40a.
- 10 Nov 2026Revised ESRS in force
Entry into force only; application from FY2027.
- FY2027New scope applies
Revised ESRS mandatory; value-chain cap applies; reports in 2028.
- 19 Mar 2027Transposition deadline
Omnibus I Articles 1 to 3 into national law.
- 1 Jul 2027Assurance standards
Deadline for the Commission’s limited assurance standards.
- FY2028Article 40a reports
Non-EU group reporting; first reports in 2029.
Terms
CSRD terms, defined at the provision
Art 19a(1)
Sustainability statement
The dedicated section of the management report that holds the CSRD disclosures.
Dir 2022/2464 Art 5(2)(a)
Wave one
Companies reporting since FY2024; limited to FY2024–FY2026 unless above both new thresholds.
Art 19a(3)
Protected undertaking
A value-chain undertaking with an average of 1,000 employees or fewer in the preceding financial year.
Art 19a(9)
Exempted subsidiary
An EU subsidiary relieved of its own statement because a parent’s consolidated report covers it, on conditions.
ESRS 1 ¶27
Top-down approach
A materiality conclusion on a topic drawn from strategy and business model, with a specific assessment where it is not evident.
Art 34(1)(aa)
Limited assurance
The level of assurance the CSRD opinion gives; the reasonable-assurance route was deleted.
Dir (EU) 2022/2464
CSRD
The Corporate Sustainability Reporting Directive, which rewrote the sustainability provisions of the Accounting Directive.
DR (EU) 2026/1563
ESRS
The European Sustainability Reporting Standards: two cross-cutting and ten topical standards.
Art 19a(1)
Double materiality
Reporting on the company’s impacts on people and the environment, and on how sustainability matters affect the company.
Dir (EU) 2026/470
Omnibus I
The 2026 directive that raised the CSRD thresholds, capped value-chain requests and deleted reasonable assurance.
Accounting Directive
Article 40a
The group-level report for a non-EU parent with large EU turnover, from financial year 2028.
Scope turns on facts a form cannot see: the group’s structure, which figures count, and what has changed since the last period.
Treat every answer on this page as a provisional position, to be confirmed against the transposing law.
Frequently asked
Questions people ask
What does CSRD stand for?
CSRD stands for the Corporate Sustainability Reporting Directive, Directive (EU) 2022/2464.
It is the EU law that requires the largest companies to publish a sustainability statement in their management report, prepared under the European Sustainability Reporting Standards (ESRS) and given a limited assurance opinion.
Does CSRD apply in the UK?
Not as UK law.
The CSRD is an EU directive and binds EU Member States.
It reaches UK groups four ways: through EU subsidiaries above the thresholds, through securities on an EU regulated market, through Article 40a from financial year 2028 for groups with more than €450 million of EU turnover in each of the last two years, and through data requests from EU customers that report.
What companies does the CSRD apply to after Omnibus I?
From financial years beginning on or after 1 January 2027, EU undertakings, EU parents of groups and EU-listed issuers that exceed both an average of 1,000 employees and €450 million of net turnover in the financial year.
Non-EU groups are caught by Article 40a from financial year 2028.
Is the CSRD still applicable?
Yes.
Omnibus I narrowed the CSRD and moved dates; it did not repeal it.
Companies above both new thresholds report, wave one companies keep reporting if they stay above them, and Member States must transpose the changes by 19 March 2027.
Is CSRD the same as ESG?
No. ESG is a general label.
The CSRD is a specific EU law that uses its own term, “sustainability matters”, defined in Article 2(17) of the Accounting Directive as environmental, social and human rights, and governance factors, and it sets who reports, where, to which standard and with what assurance.
What is the difference between the CSRD and the ESRS?
The CSRD is the directive that creates the duty to report.
The ESRS are the standards that set what the report contains.
The CSRD rules now sit in the Accounting Directive; the ESRS are a Commission delegated regulation, revised in 2026 as Delegated Regulation (EU) 2026/1563.
Does a UK company with an EU subsidiary have to report under the CSRD?
The UK parent does not report as such.
Its EU subsidiary reports if it exceeds 1,000 employees and €450 million net turnover, on its own or as parent of an EU sub-group, from FY2027.
It can be exempt where the group’s consolidated sustainability reporting covers it and is prepared under the ESRS or a standard the Commission has found equivalent.
What is the UK equivalent of the CSRD?
There is no UK directive equivalent.
The nearest standards are UK SRS S1 and S2, published by the Department for Business and Trade on 25 February 2026 on single (financial) materiality.
Under the FCA’s final rules, PS26/19 of 30 September 2026, listed companies in UKLR 6, 14, 15, 16 and 22 report against them on a comply-or-explain basis for periods beginning on or after 1 January 2027.
When does the CSRD apply to my company?
Wave one companies have reported since financial year 2024 and continue only if above both new thresholds.
Every other company above them starts with financial years beginning on or after 1 January 2027, reporting in 2028.
Article 40a group reports start with financial year 2028, published in 2029.
The transposing law of the relevant Member State confirms the final position.
Is CSRD assurance limited or reasonable?
Limited.
Omnibus I deleted the Commission’s power to adopt reasonable assurance standards, and moved the deadline for limited assurance standards to 1 July 2027.
The opinion covers compliance with the ESRS, the process used to identify the information reported, and the Taxonomy Article 8 disclosures.
Can a UK supplier refuse a CSRD data request?
A supplier with an average of 1,000 employees or fewer in the preceding financial year is a protected undertaking.
From financial years beginning on or after 1 January 2027 it may decline information beyond the voluntary standard’s capped datapoints, and the customer must flag the excess.
The cap covers CSRD reporting requests only, not due diligence or commercial ones.
Does the CSRD require a transition plan?
No. It requires disclosure.
Under ESRS E1 a company describes the key features of its climate transition plan or, if it has none, says so and indicates whether and when it expects to adopt one.
The duty to adopt a plan that sat in the CSDDD was deleted by Omnibus I.
Who can provide CSRD assurance?
By default the statutory auditor of the financial statements.
Each Member State may also allow a different statutory auditor or audit firm, and may allow an accredited independent assurance services provider on equivalent requirements, so the answer depends on the country where the report is filed.
What is the CSRD reporting deadline?
The sustainability statement is part of the management report, so it is published on the same timetable as the annual report under the Member State’s law.
For a company newly in scope, the first statement covers the financial year beginning on or after 1 January 2027 and is published in 2028.
How many companies remain in CSRD scope?
The Commission’s staff working document SWD(2026) 500 estimates 6,753 companies remain subject to CSRD reporting after Omnibus I: 1,535 that already report and 5,218 that will report for the first time. It puts the reduction in companies in scope at about 85%.
Sources
Primary sources
Every figure, date and status on this page traces to the instrument’s owner.
Secondary commentary is never the source for a number.
- EUR-LexDirective 2013/34/EU (Accounting Directive), consolidated 18.03.2026 — Arts 2(17), 3(4), 19a, 29a, 29ca, 34, 40a, 48i
The operative CSRD duties as amended: scope, the value-chain cap, assurance, Article 40a and the exemptions.
- EUR-LexDirective (EU) 2022/2464 (CSRD), as published
The amending directive itself, adopted 14 December 2022.
- EUR-LexDirective (EU) 2026/470 (Omnibus I) — Arts 2(4), 2(13), 3, 5(1), 6; recitals 7, 12, 31
The new thresholds, the Article 40a tests, wave one limited to FY2024–FY2026, transposition by 19 March 2027.
- EUR-LexDirective (EU) 2025/794 (Stop-the-Clock), Art 1
Wave two moved to FY2027, wave three to FY2028.
- EUR-LexDelegated Regulation (EU) 2026/1563 — the revised ESRS, Arts 1–3
Published 21 September 2026; in force 10 November 2026; applies to financial years beginning on or after 1 January 2027.
- EUR-LexDelegated Regulation (EU) 2023/2772 — the first set of ESRS
The 2023 standards, still one of the FY2026 options.
- Council of the EUC(2026) 5010 final, Annex I — revised ESRS 1 and 2
ESRS 1 ¶24 (“shall not” disclose immaterial information) and ¶27 (top-down approach).
- European CommissionSWD(2026) 500 final, §2.3
6,753 companies remain in scope; about 85% fewer than before.
- EUR-LexNational transposition measures for Directive (EU) 2026/470
Which Member States have notified national measures.
- European Commission (DG FISMA)Corporate sustainability reporting
The Commission’s CSRD page and policy timeline.
- European Commission (DG FISMA)Additional explanatory information regarding the value chain cap, 6 May 2026
The cap applies only to CSRD reporting requests.
- EFRAGESRS-40a Exposure Draft, Basis for Conclusions (July 2026)
Technical advice due January 2027; first Article 40a reports for FY2028, published 2029.
- Financial Conduct AuthorityPS26/19: Aligning listed issuers’ sustainability disclosures with international standards
Final rules, 30 September 2026: UK SRS on a comply-or-explain basis for listed companies from 2027.
- Department for Business and TradeUK Sustainability Reporting Standards (GOV.UK guidance)
UK SRS S1 and S2, published 25 February 2026 for voluntary use.