The European Commission launched the first Omnibus Simplification package on sustainability, which proposes substantial reductions in ESG reporting requirements for companies and their business partners.

The MBB calls on the EU Council and European Parliament to adopt the Omnibus sustainability package swiftly and commit to Europe’s competitiveness without diluting or reversing the positive elements included in the proposals.

Main elements of interest to Maltese businesses include:

• Corporate Sustainability Reporting Directive (CSRD): Sustainability reporting to become applicable to companies employing 1000+ employees
• Corporate Sustainability Due Diligence Directive (CSDDD): Due diligence requirement will be limited to direct business partners and subject to information limitations for companies employing less than 500 employees
• Carbon Border Adjustment Mechanism (CBAM): Exempting small importers bringing in less than 50 metric tons per year of CBAM-covered goods from CBAM obligations.
• EU Taxonomy: Increase in threshold of companies subject to taxonomy reporting to the ones applicable to the CSDDD and simplifications to the most complex “Do no Significant harm” (DNSH) criteria for pollution prevention and control.

The Omnibus Simplification package marks a positive change in policy direction towards a more competitiveness focused agenda, by reducing administrative and regulatory burdens on SMEs and small midcaps, while applying regulatory requirements to larger companies that are better placed to comply with sustainability reporting and due diligence.