Background
After a long series of regulations linked to the EU’s Green Deal, it became clear that the regulatory burden could be a strain on many businesses, especially small and medium-sized enterprises. According to the Draghi report, The Future of European Competitiveness, presented in September 2024 by Mario Draghi, former Prime Minister of Italy and former President of the European Central Bank, this burden was undermining growth and competitiveness. Based on the report, the EU adopted a new five-year plan, A Competitiveness Compass for the EU.
ESRS — European Sustainability Reporting Standards — are the reporting standards that underpin CSRD (the EU’s Corporate Sustainability Reporting Directive). They specify exactly what companies must report on: greenhouse gas emissions, social matters, governance, biodiversity, and more. The first version was adopted by the European Commission in July 2023 and contains more than 1,100 data points.
What is the Omnibus package?
In February 2025, the European Commission launched what is known as the Sustainability Omnibus—a broad package of simplification measures affecting CSRD, the EU Taxonomy, and CSDDD. The background was political pressure to reduce administrative burdens, particularly for businesses.
For ESRS, this means three things: fewer companies in scope, more time to prepare, and simpler standards.
1. A dramatic reduction in who must report
The original CSRD would have applied to around 50,000 European companies. After Omnibus, the threshold was raised to companies with more than 1,000 employees combined with either revenue above EUR 50 million or a balance sheet total above EUR 25 million. This reduces the number of companies subject to reporting requirements by an estimated 80 percent.
2. A two-year delay — “Stop the Clock”
The EU adopted a temporary “stop the clock” measure that postpones the reporting obligation for wave 2 and 3 companies by two years. In practice, this means that companies that were due to report for the first time in 2026 or 2027 will now not be required to do so until 2028 and 2029, respectively. In Norway, this postponement has already entered into force.
3. Quick fix for wave 1
Companies already reporting (wave 1, the very largest companies) received a “quick fix” in July 2025: they do not need to add new data points for the 2025 and 2026 financial years compared with what they already reported for 2024. This applies in particular to wave 1 companies with fewer than 1,000 employees.
4. Revised ESRS with more than 60% fewer mandatory data points
In December 2025, EFRAG submitted its proposal for simplified ESRS to the European Commission. On 6 May 2026, the Commission opened a public consultation on the revised draft. Key changes include:
- More than a 60 percent reduction in mandatory data points
- A clearer distinction between what is always mandatory and what is subject to materiality
- Simplification of the materiality assessment process (double materiality)
- Prioritisation of quantitative data points over narrative requirements
- Shorter and clearer wording
The directive itself (Omnibus I) entered into force on 18 March 2026. Adoption of the revised ESRS standards as a delegated act is expected during 2026.
What does this mean for Norwegian companies?
You are still subject to the reporting requirement if you have more than 1,000 employees. The reporting obligation still applies, and the current ESRS standards from 2023 remain in use until the revised standards are adopted.
You have been postponed—not exempted. Wave 2 and 3 companies have been given more time, but work on data foundations, systems, and materiality assessments should not be left until the last minute. Companies that start early report better and more cost-effectively.
The value chain is not on hold. Large customers and banks will still request sustainability information. Even if your company falls outside the formal scope, it may still face demands from both below and above in the value chain.
Norway’s implementation follows the EU. Chapter 2a of the Norwegian Accounting Act is the Norwegian implementation. The Ministry of Finance is following the EU process closely and will update the ESRS regulation in step with decisions made in Brussels.
Even in a phase of simplification, the best investment is to understand what is actually material to your business. A strong materiality assessment is robust regardless of whether 1,100 or 400 data points need to be reported—and it provides strategic value far beyond compliance. Feel free to contact us for a no-obligation review of where your company currently stands.
---
Sources: EU Omnibus I — Directive (EU) 2026/470, in force from 18 March 2026. EFRAG revised ESRS exposure drafts, December 2025. European Commission consultation on revised ESRS, 6 May 2026. Quick-fix regulation adopted 11 July 2025, in force in Norway from 13 November 2025.