In a major regulatory shift, EU member states have approved a “Stop-the-Clock” proposal to delay key sustainability compliance rules, aiming to enhance competitiveness and reduce burdens on European businesses. The move affects the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD)—cornerstones of the EU’s ESG strategy and carbon neutral transition. 

Under the approved measure, large companies and listed SMEs that have not yet started reporting under the CSRD will have their compliance deadline postponed by two years. The CSDDD’s transposition and first-phase application—which targets the EU’s largest corporations—will also be delayed by one year. These changes are part of the broader “Omnibus I” legislative package, designed to streamline sustainability laws, clarify obligations, and support ESG alignment without overburdening businesses. 

Poland, which currently holds the EU Council presidency, led the charge for simplification. Adam Szłapka, Poland’s Minister for the European Union, emphasized the practical benefits: “Simplification is one of the priorities of the Polish presidency. Today’s agreement is a first step on our decisive path to cut red tape and make the EU more competitive.” 

By extending deadlines, EU lawmakers hope to provide companies with more time to adapt internal systems for ESG reporting and due diligence, and reduce the risk of rushed or non-compliant disclosures. Legal experts note this delay may also create space for refining the directives’ implementation and aligning them with evolving global standards on carbon neutral strategy and sustainability disclosures. 

The proposal will now proceed to negotiations with the European Parliament, which is expected to vote on it via an urgent procedure on April 1, 2025. A final agreement could lead to wider revisions of EU sustainability regulations, signaling a recalibrated approach to ESG compliance across the bloc. 

Fuentes: 

https://esgnews.com/eu-council-approves-stop-the-clock-plan-to-delay-sustainability-reporting-and-due-diligence-rules/ 

https://www.consilium.europa.eu/en/press/press-releases/2025/03/26/simplification-council-agrees-position-on-the-stop-the-clock-mechanism-to-enhance-eu-competitiveness/  

https://natlawreview.com/article/european-council-greenlights-first-step-omnibus-stop-clock-proposal#google_vignette