ESG reporting requires a focus on outcomes and financial KPIs, not just outputs. Current standards, like SASB and CSRD, mostly emphasize activities without mandating targets, undermining sustainability goals. Recommendations include requiring performance-based targets and linking sustainability to business value for effective decision-making.
EU Parliament adopted Omnibus I, narrowing sustainability rules, limiting CSRD to companies with >1,750 employees and CSDDD with >5,000 employees. Critics warn of weakened corporate accountability; supporters claim it boosts competitiveness. Trilogue negotiations began for final text.
The EU Parliament has voted to scale back corporate sustainability laws by raising the thresholds for company compliance and delaying reporting deadlines until 2028. The new rules mean the CSRD only affects very large companies, and even larger thresholds apply for the CSDDD. Requirements like mandatory Paris Agreement transition plans were dropped, and accountability shifted from the EU to national governments. Environmentalists criticized the move as weakening climate action, and experts noted it now covers far fewer businesses. The changes await ratification and may still be subject to modification after negotiations with member states.
KPMG's ESG Assurance Maturity Index 2025 reports on ESG practices among 1,320 companies, highlighting regulatory shifts and the importance of proactive response to sustainability standards. The survey includes diverse regions and emphasizes that ESG assurance is a continuous journey requiring commitment.
https://kpmg.com/sg/en/insights/esg/esg-assurance-maturity-index-2025.html
TLDR; KPMG reports lessons learned from the first round of CSRD reporting, emphasizing timely preparation, strong processes, enhanced disclosure quality, senior leadership engagement, and focusing on impact rather than mere compliance. These insights aim to improve future reporting practices.
The European Parliament narrowly voted against a compromise to weaken sustainability reporting and due diligence rules, stalling efforts to simplify regulations. The rejected proposal would have exempted many companies by setting higher employee and revenue thresholds for compliance, but it failed due to internal political divisions. As a result, uncertainty persists for businesses subject to these rules, with further negotiations required ahead of the next parliamentary session. Lawmakers opposing the changes argue this protects the integrity of the EU’s sustainability agenda, while critics warn of continued compliance burdens and a lack of regulatory clarity.
Europe’s new sustainability reforms aim to simplify corporate reporting and due diligence, raise the company size thresholds, and remove EU-wide liability for sustainability harms. While supporters say this reduces compliance costs, critics argue it weakens accountability and Europe’s standing in global sustainable finance. Early evidence shows substantial progress from companies under the original rules, but concerns remain that deregulation could result in less reliable data, transparency gaps, and weaker market trust. The outcome is uncertain, as lawmakers have rejected the current reform proposal, and the final approach will shape both Europe’s market credibility and global influence in sustainability standards.
CSRD: EU directive mandating companies report on sustainability efforts, aiming for transparency, accountability, and alignment with climate goals. Enhances disclosure standards, promotes sustainable finance, and supports EU Green Deal.
