Update: 4.08.2025
Update: the law implementing the “stop-the-clock” directive was published on July 28, 2025, in the Journal of Laws.
On February 26, the European Commission presented the first simplification package for sustainability regulations, Omnibus I, which will affect rules on reporting, due diligence, and the CBAM mechanism. The package is currently in the negotiation phase, and we don’t yet know when or to what extent it will be implemented (though the European Parliament and Council are likely to prioritize it).
Many indications suggest that mandatory reporting will be postponed by up to two years. Larger changes remain an open question for the Parliament and the Council to decide. What does this mean for companies? Can smaller firms deprioritize emissions accounting and reporting? What significance does Omnibus hold for large companies, which are least affected by the proposed changes?
Years of working with the business sector and the scientific community, combined with close observation of climate trends, shape our rather unpopular, yet increasingly relevant, perspective on ESG reporting. For many years, we’ve consistently told our clients, journalists, and other opinion leaders: reporting alone will not protect the climate. Climate change is unfolding at an alarming pace before our eyes, affecting quality of life and business operations worldwide. It is one of the most serious challenges humanity has ever faced. Reporting won’t stop climate change, but…
But it does mobilise companies to understand their own impact, and later, to reduce it through decarbonisation efforts. This fosters greater awareness and shifts in consumer behavior. That’s why we firmly believe ESG reporting should not be seen solely as a matter of regulatory compliance. CSRD requirements increasingly align with the expectations of clients, business partners, financial institutions, and investors. This means companies that disregard climate issues may struggle to access financing or remain competitive.
It’s hard to declare continued decarbonisation of the continent while simultaneously reversing mechanisms that motivated companies to measure and report their emissions. How the Commission intends to decarbonise companies without having any information about their structures remains unclear to us – says Łukasz Broniewski, Management Board Member and co-founder of the Climate&Strategy Foundation. – Both our clients and other companies ask us, “What now?” At this stage, we advise staying calm and monitoring the European Parliament closely, as no decisions have been made yet. If we don’t receive clarity by July, we would recommend that companies who were expected to begin reporting in 2026, based on current regulations, return to data collection and analysis. Even if reporting ends up delayed, the information collected will be a valuable asset for companies, one that, regardless of EU decisions, will determine their competitiveness.
Consistency among industry leaders
Despite the current lack of clarity, the approach of large companies (with over 1,000 employees) demonstrates an understanding of the real need to reduce business-related climate impact. At the Foundation, we run many projects for such companies and observe their continued commitment to previously set targets, as well as consistent strategies for emissions reduction and reporting. For example, one large company we work with responded to the Omnibus proposal by saying:
“Our company has no plans to change its long-term commitment to reporting and carbon footprint reduction. We believe that a detailed assessment, based on the GHG Protocol, is key to understanding and managing our climate impact. As such, Omnibus will not affect our commitment or our approach to carbon accounting and reporting.”
Łukasz Dobrowolski, Director of Climate Strategy and Energy Market at the Climate&Strategy Foundation, summarises the current reality:
“In this time of regulatory uncertainty, we recommend consistency and prudence. The physical changes to our climate will not slow down in response to decisions made by the European Commission. Companies unsure how to act should understand that in the foreseeable future, they will be operating in the midst of an escalating climate crisis. This has two consequences. First, we can expect growing pressure, not necessarily on reporting per se, but on actual decarbonisation. It is therefore sensible to understand one’s carbon footprint and plan mid- and long-term decarbonisation actions and investments. These actions often have additional financial benefits and reduce dependence on geopolitically unstable energy markets. Second, in today’s chaotic reality, companies must increasingly look at climate adaptation – specifically, the physical risks to operations posed by extreme weather events”, says Dobrowolski.
Although the deregulation debate is stirring strong emotions, we still don’t know when or in what form the changes will take effect. We are convinced that companies that use this time to prepare, rather than treat it as an excuse to abandon climate actions, will gain a competitive edge in their relationships with investors, banks, and partners. That’s why we believe the time before the Omnibus enters into force is best used to:
“When business is responsible for over 70% of greenhouse gas emissions, and thus both directly and indirectly responsible for climate change, emissions reduction becomes a matter of real corporate responsibility. Consumers and business partners are increasingly aware of this and want to engage with brands that are truly making a difference. It is highly likely that companies that retreat from their previously publicised climate goals upon hearing about deregulation never took the issue seriously in the first place – and their “green” messaging was more posturing than practice. What we’re witnessing now is a litmus test for greenwashing” – says Dr. Agnieszka Liszka-Dobrowolska, Management Board Member and co-founder of the Climate&Strategy Foundation.
Our Foundation supports companies in this transformation by providing tools and education. We are convinced that the time before Omnibus takes effect, regardless of its final shape, should be used to strengthen business positioning and prepare for the changes ahead.
