April 16, 2025 - The release of the EU Omnibus Proposal has introduced a wave of uncertainty across the sustainability landscape, leaving reporting companies wondering: adapt now or wait it out? Companies across industries have been scrambling to assess what the proposal might mean, if passed, and what the long-term impacts could be.

The European Parliament recently voted on April 3 to "stop the clock" on upcoming reporting requirements and due diligence regulations for many companies. This proposal delays reporting on the Corporate Sustainability Reporting Directive (CSRD) by two years for Wave 2 and 3 companies, and delays reporting on CSDDD Corporate Sustainability Due Diligence Directive (CSDDD) by one year – with an additional pending procedural step to formally adopt the postponement within the next few weeks.

However, the uncomfortable truth remains that no substantive changes have been voted on yet and we cannot know what the future may hold. The EU Parliament could still take months before substantive changes are negotiated on or voted in, with additional delays as EU member states translate them into law, further prolonging actionable impacts and potential decision making.

To Pause ESG Initiatives or to Press on?

While there's no one-size-fits-all solution or easy answer, we can take a moment to look beyond the compliance lens at the bigger picture: the strategic value of sustainability.

While standards, frameworks, and recent regulations have provided a helpful structure for many companies to understand their responsibilities, risks, and impacts, these structures have also set the stage for the transition to best practice sustainability governance. There is immense opportunity and insight to be had both financially and operationally by integrating sustainability throughout the business. Whether you’re at the beginning of the process or somewhere along the journey, companies, investors and stakeholders have long seen the value created from understanding their own operations. From workforce planning, supply chain sourcing, or assessing operational costs, the totality of the metrics being collected has proven to consistently create long-term value when used effectively.

Sustainability Starts with Strategic Decision Making

The global regulations being enacted have one consistent starting point in common: materiality. That begins with determining the sustainability related risks, opportunities, and impacts that matter to the company and their stakeholders. Regardless of where global compliance measures take us, understanding materiality is a critical foundational step. While there’s a financial and impact materiality lens, the trend continues to move toward double materiality as the global standard. If your company wants to increase its financial value through the insights of both financial and non-financial data, conducting these assessments will not only improve knowledge and cross-functional development internally, but has the side benefit of helping your company prepare for any regulations to which they may be subject.

Bottom Line: Sustainability is a Good Investment

Amid this uncertainty, some key facts remain clear. What we know:

• Wave 1 companies (larger EU-based entities) remain largely unaffected. If you’re already in scope and have made investments in reporting readiness, stay on track.
• Climate disclosures (ESRS E1) and other core quantitative data points aligned with frameworks like ISSB, GRI, and TNFD are predicted to remain in place. So, continuing to prepare for disclosing those metrics will set your teams up for success.
• Non-EU companies will still need to assess their consolidated employee counts and turnover for CSRD scope—thresholds apply at group level, not entity level.

Despite the temptation to wait for clarity, delaying action could come at a cost.

Why Pausing Could be Risky

In order to report anything related to sustainability, simply put, companies have to do the work to be reported on. This means setting teams up for success by ensuring that there’s internal expertise (alongside external support) and having strategies in place to plan ahead. The most important thing for companies to consider now is staying agile and being able to adjust to changing market conditions. This also includes data management preparation and implementing proper management tools and platforms to streamline workflows as more data is collected.

Tools like Workiva’s ESG and CSRD platforms can help streamline this process. Contact us to learn more about how we support both platform integration and strategic projects.

Even if this Omnibus package ultimately leads to reduced scope, investors, stakeholders, and regulators outside the EU are still demanding robust sustainability data. This trend will continue. Data from CSRD and CSDDD more or less satisfy global regulatory expectations, offering a strategic advantage in global compliance. Delaying preparation now risks losing momentum in integrating sustainability data into core business strategy and can lead to increased costs and rushed compliance later.

The Benefit of Time

Time is a valuable asset. A longer runway allows companies to:

• Spread out the cost of materiality assessments and supply chain due diligence.
• Improve internal processes and hire strategically.
• Strengthen risk management and supply chain resilience.
• Set informed long-term sustainability goals.

Better data leads to better business decisions. As companies continue to integrate climate data with both financial and operational data, we’ve also seen a shift in the accuracy of GHG emissions reporting by moving from estimated or spend-based emissions to actual emissions data. This is driving updated decarbonization action plans and emissions reduction goals that are beneficial for both business and the planet.

There’s also rising attention to nature-related risks and commodity sourcing, from the emergence of the TNFD framework to the EU deforestation regulation that is now in place. The delays around CSRD and CSDDD allow for increased focus on some of the other risks and reporting requirements companies are facing.

The moral of the story is:

1. Keep moving forward
2. Stay agile and ready to be ahead of the regulatory requirement game, and
3. Consider the strategic and financial value that can be created by leaning into what good sustainability governance has to offer.

If you have questions about sustainability reporting, CSRD compliance, carbon accounting, or any ESG topics, we can help. Contact Matthew Williams and Alissa Kirby today to get started.