ESG

CSRD and CSDDD: Omnibus I Simplification

Following adoption by the European Parliament and the Council, the Omnibus I Directive amending the Corporate Sustainability Reporting Directive (CSRD) and Corporate Sustainability Due Diligence Directive (CSDDD) is expected to enter force in early 2026 after publication in the Official Journal, with Member States then required to transpose the CSRD-related changes within 12 months.

The amendments narrow the scope of both regimes, meaning fewer entities will be in scope. Other changes include a “value chain cap” to limit CSRD information requests made of smaller value‑chain entities, removal of the mandatory climate transition plan from CSDDD, and deferring first CSDDD compliance to 26 July 2029.

These changes follow the “Stop‑the‑Clock” Directive, which was adopted and transposed into Irish law last year, deferring CSRD application for “wave two” and “wave three” entities by two years.

CSRD: ESRS Simplification

EFRAG delivered its final technical advice to the European Commission on simplification of the European Sustainability Reporting Standards (ESRS) in early December 2025. The European Commission is expected to adopt revised ESRS by delegated act in mid-2026.

CSRD: Wave One Reporting in 2026

"Wave one” reporters preparing their second CSRD reports in 2026 (on FY2025 data) benefit from the ESRS “Quick‑Fix” Delegated Act. This measure extends phase‑ins and defers additional data points so that wave one entities will not report more in respect of FY2025 and FY2026 than for FY2024 and extends most transitional reliefs previously limited to entities with fewer than 750 employees.

In addition, the Omnibus I amendments to CSRD permit Member States discretion to exempt existing wave one reporters that would fall out of scope under the revised thresholds from reporting in 2026 and 2027.

Empowering Consumers for the Green Transition

The Directive on empowering consumers for the green transition is to be transposed in Irish law by 27 March 2026. It amends the Unfair Commercial Practices Directive and the Consumer Rights Directive to target misleading environmental claims about products.

ESG Ratings Regulation

The ESG Ratings Regulation entered into force on 1 January 2025 and will apply from 2 July 2026. The ESG Ratings Regulation regulates ESG rating providers that operate within the EU.

By 2 April 2026, Member States are required to designate their competent authority for the purposes of the ESG Ratings Regulation. By 2 November 2026 (in the case of small ESG rating providers) or 2 August 2026 (in the case of all other ESG rating providers), ESG rating providers which operated in the EU at the date of entry into force of the ESG Ratings Regulation must notify ESMA if they wish to continue operating and, if so, apply for authorisation or recognition. For third-country ESG rating providers, a framework for (i) equivalence assessments (by the Commission), (ii) recognition (by ESMA) or (iii) authorisation (by ESMA) of an endorsement (by an authorised EU ESG rating provider), has been included in the Regulation.

EU Deforestation Regulation

The EU Deforestation Regulation (EUDR) aims to tackle deforestation and forest degradation by regulating the placement and export of certain products within the EU market. Obligations under the EUDR will apply from 30 December 2026 for large and medium operators and traders, and from 30 June 2027 for small and micro‑operators, following amendments to the EUDR which took effect in late December 2025. The amendments also introduce simplification measures, including limiting the obligation to submit due diligence statements to operators first placing the product on the EU market.

Irish legislation to give effect to the EUDR is anticipated during 2026.

EU Green Bond Regulation

The EU Green Bond Standard Regulation entered into force on 21 December 2024. The transitional period to facilitate the provision of services by external reviewers (ERs) expires on 2 June 2026, after which ESMA will become responsible for the registration and ongoing supervision of ERs in the EU. For third-country external reviewers, a framework for (i) equivalence assessments (by the Commission), (ii) recognition (by ESMA) or (iii) authorisation (by ESMA) of an endorsement (by a registered EU external reviewer), has been included in the Regulation and applies from 21 June 2026.

The Commission has also been mandated under the Regulation to publish a report, and legislative proposal if deemed necessary, on whether there is a need to regulate sustainability-linked bonds, by 21 December 2026.

For more information, read our insights here: Green Bonds: EU Green Bonds Regulation will apply from 21 December 2024 and EU Green Bond Regulation published in Official Journal: key points for issuers.

EU Taxonomy

Following publication in the Official Journal on 8 January 2026, the amendments to the existing Taxonomy delegated acts will enter force later this month and will apply from 1 January 2026. For reports published in 2026 (covering FY2025), reporting companies may, as a transitional option, apply either the amended reporting rules or the version that applied until 31 December 2025. The European Commission is adopting FAQ on the amendments. Further amendments to the technical screening criteria under the Taxonomy Climate and Environmental delegated acts are anticipated during 2026.