Sustainability Compliance

What regulatory changes mean for your business

Few things seem to age faster than sustainability frameworks. What once felt ambitious: ten-year targets, five-year reporting cycles, broad carbon accounting principles, now risks falling behind the pace of climate science, public scrutiny, and market expectations. Yet some frameworks, like the GHG Protocol, have stood the test of time, forming the foundation of corporate sustainability reporting for over a decade.

As the energy transition and carbon markets evolve, so too must the rules that govern them. In such a critical and still relatively young field, regular updates are not just expected, they are essential. Today’s changing rulebooks aim to match the complexity and urgency of the world they seek to guide. For companies with established strategies, navigating these shifts thoughtfully will be crucial to maintaining both compliance and credibility.

But with progress comes complexity. New acronyms, shifting thresholds, and conflicting interpretations have flooded the sustainability landscape, and it can feel like the ground is moving just as companies have found their footing.

In this article, we aim to break down some of the recent key changes across major sustainability frameworks, and what they mean for your business. Whether you’re navigating new disclosure rules, refining your EAC procurement strategy, or preparing for future audits, we’ll help you connect the dots.

1. CSRD

The Corporate Sustainability Reporting Directive (CSRD) intended to expand the scope of companies required to report non-financial data, starting from January 2025 with large companies, with a rolling implementation that would gradually include listed SMEs and non-EU companies with significant operations in the EU in subsequent years.

But following criticism over reporting complexity, the EU Commission introduced an Omnibus package with simplification proposals:

• A scope reduction in which the threshold for mandatory sustainability reporting is raised to companies with over 1,000 employees, aligning more closely with the CSDDD. This change is expected to reduce the number of companies in scope by approximately 80%.
• The recently approved “Stop-the-Clock” proposal which postpones by two years the application of certain CSRD disclosure requirements for large companies and listed SMEs
• Simplified reporting standards, whereby the European Sustainability Reporting Standards (ESRS) will undergo revisions to reduce mandatory data points, eliminate sector-specific standards, and focus on quantitative over narrative disclosures.
• Voluntary reporting for SMEs, meaning companies no longer in scope will have access to a proportionate voluntary reporting standard, developed by EFRAG, to maintain transparency, but without the full compliance burden.

While the Omnibus proposal offers temporary relief, the ambition behind CSRD remains intact. Companies that treat these delays as a chance to slow down risk falling behind in a market where transparency and accountability are fast becoming key differentiators. The momentum CSRD has created, both regulatory and market-driven, will not be easily reversed. Regulatory delays may ease short-term pressure, but they should not dictate the pace of your sustainability journey. The companies that continue to strengthen their strategies now will be best positioned to lead in a business environment that increasingly rewards impact over minimum compliance.

2. CSDDD

The Corporate Sustainability Due Diligence Directive (CSDDD) is another major development reshaping the regulatory landscape. Designed to strengthen corporate accountability for human rights and environmental impacts across value chains, CSDDD faced intense negotiation before reaching a final decision in 2024.

However, it too, has been impacted by the Omnibus proposal.

Key proposed changes to the CSDDD include:

• The delayed application with the transposition deadline for Member States is extended by one year to July 2027, and the first phase of application for large companies delayed to July 2028.
• Focused supply chain due diligence, with obligations being limited to direct (Tier 1) suppliers, reducing the complexity of supply chain assessments. Companies are required to assess indirect suppliers only when there is a substantiated concern.
• Reduced assessment frequency of due diligence assessments which are to be conducted every five years instead of annually, easing the operational burden on companies.
• The removal of EU-wide civil liability, leaving enforcement to national laws, thereby respecting the diversity of legal systems across Member States.

While the proposed changes may ease short-term compliance pressures, they do not diminish the overall direction towards stricter corporate accountability. Companies that view these delays as an opportunity to postpone action risk falling behind as regulatory expectations, stakeholder scrutiny, and reputational risks continue to mount. CSDDD marks the beginning of a new era in corporate responsibility, and those that fail to embed strong due diligence practices early may find themselves exposed in a rapidly evolving and increasingly unforgiving market environment.

3. EU Taxonomy

The EU Taxonomy continues to be a cornerstone for defining what is considered “sustainable” economic activity, especially in financial and investment reporting. Under the Omnibus simplification proposal, reporting requirements would be streamlined: companies could omit disclosures for activities representing less than 10% of turnover, capital expenditure, or operating expenses, and smaller companies would be allowed to opt into voluntary reporting rather than mandatory disclosures. While the technical framework remains intact, these changes aim to ease administrative burdens without diluting the Taxonomy’s central role in shaping market expectations around sustainability.

4. CBAM

The Carbon Border Adjustment Mechanism (CBAM) entered a crucial new phase in 2025. But just like the rest of the key sustainability directives introduced by the EU, it has fallen victim to the Omnibus proposal.

Key changes include:

• A mass-based threshold of 50 tonnes per importer, per product type, replacing the previous €150 shipment-based threshold. This exempts approximately 90% of importers but it is said to still cover 99% of emissions.
• Extended reporting and certificate surrender deadlines, moving from 31 May to 31 August.
• A reduced advance purchase requirement for CBAM certificates, from 80% to 50% of embedded emissions.
• Enhanced anti-abuse and anti-circumvention provisions.

The proposal also includes the “Stop the Clock” measure, in this case, acting as a temporary exemption for certain indirect emissions from CBAM’s scope, until sector-specific methodologies are refined.

5. SBTi

The Science Based Targets initiative (SBTi) is consulting on a major update to its Corporate Net-Zero Standard (Version 2.0), following widespread feedback about the practical challenges of implementation.

Key proposals include:

• A shift from ambition to accountability and progress, introducing a full validation model to assess not just targets, but delivery.
• New tailored requirements based on company size and geography, giving more flexibility to smaller players.
• Revised scope 3 guidance, moving away from fixed-percentage coverage toward prioritisation of material emissions sources and suppliers.
• Clearer pathways for indirect mitigation measures, such as book-and-claim certificates, with quality standards under development.
• Stronger recognition for beyond value chain mitigation (e.g. carbon finance) to accelerate impact.

While the final standard is still under consultation, the direction is clear: moving towards impact, traceability, and system transformation. Companies will need to demonstrate not just that they set targets, but that they are delivering on them, adjusting as necessary, and contributing meaningfully to sectoral decarbonisation.

6. GHG Protocol

And last, but most definitely not least, few frameworks have been as influential or as widely referenced as the Greenhouse Gas (GHG) Protocol. Now, for the first time in over a decade, it is undergoing a formal review. Updates under consultation address key areas such as scope 2 reporting, including the treatment of market instruments like EACs, scope 3 categorisation, and the principles underpinning credible emission reduction claims.

Draft recommendations hint at stricter standards for market-based claims and clearer rules on matching energy consumption with renewable attributes, including discussions around temporal granularity. The outcome is expected to clarify how certificates, including EACs, can be used credibly within a broader emissions reduction strategy, and with many companies relying on GHG Protocol guidance to justify climate claims, the upcoming revision will shape not only reporting but how companies structure procurement and decarbonisation strategies.

Keeping a close eye on the GHG Protocol updates is critical: they will likely influence every subsequent framework, from SBTi to national regulation like CSRD compliance to RE100 membership criteria.

Looking ahead

The evolution of sustainability frameworks reflects a wider truth: that businesses can no longer view compliance as a one-time achievement. Instead, compliance must be understood as an ongoing process, one that demands flexibility, vigilance, and a willingness to adapt as expectations shift.

While simplifications such as those proposed in the Omnibus package may ease short-term reporting burdens (while creating a level of distrust in certain institutions), it seems like it may have been a little bit too late. EU regulations have already created the momentum and market awareness needed for meaningful change, so even if “pauses” appear in the formal rules, smart businesses will use this time to get stronger, not slower. True leadership comes from raising ambition, not waiting for deadlines to force action.

Companies that treat regulatory evolution as an opportunity, not just a burden or an obligation, will be better equipped to lead in an economy where sustainability performance is increasingly inseparable from business performance.

At Nvalue, our teams are dedicated to helping you navigate this dynamic landscape. We monitor regulatory developments closely and ensure that our consultancy, procurement services, and strategic support are always fully aligned with the latest standards so you can move forward with confidence, credibility, and compliance.