Stop the Clock – Vote on CSRD Omnibus postpones deadlines

|  April 4, 2025

🕓 Reading time 4 minutes

Table of contents

1. What does “Stop the Clock” mean?

2. What happens to the CSRD thresholds?

3. How should you prepare further?

1. What does “Stop the Clock” mean?

The “Stop the Clock” decision will suspend sustainability reporting obligations for the second wave (originally from 1 January 2025) and the third wave (originally from 1 January 2026) postponed by two years each. This means that companies have more time to prepare for legal requirements.

Definition: Second and Third Wave

The second wave includes “Large” companies according to HBG from 250 employees, which has a balance sheet total of at least 25 million euros or a Turnover of at least 50 million euros These companies were originally supposed to start Fiscal year 2025 be obliged to report on sustainability.

The third wave regards small and medium-sized enterprises (SMEs), the listed on the stock exchange For them, the obligation to report on sustainability was originally Fiscal year 2026 provided.

Originally, companies were supposed to be able to CSRD comprehensive sustainability reports according to ESRS standards which contain all essential ESG areas The postponement thus creates a breathing space until it is clear whether the thresholds for CSRD impact will actually change.

However, the postponement is also a response to criticism from the business community that the originally set deadlines were too ambitious. Many companies, especially medium-sized enterprises, had expressed concern about the administrative burden and the strain on resources. The "Stop the Clock" resolution is therefore a compromise.

2. What happens to the CSRD thresholds?

Although this postponement will ease the pressure on many companies in the short term, uncertainty remains. A key point of criticism: the proposal to Threshold entirely to companies with more than 1,000 employees and at least €50 million in annual sales or €25 million in total assets to raise, is not yet implemented. This means that it remains unclear to companies whether and when they are subject to reporting obligations.

Many companies are therefore wondering whether the preparations they have begun should be continued or frozen. From a legal perspective, the postponement does not offer a complete reprieve, but merely a temporary relief.

3. How to prepare further?

Despite the postponement, it is advisable to continue preparing basic sustainability reporting. Companies that have already taken measures should do not drive back, but continue, , preferably after the voluntary and compressed VSME standard. Because the requirements are not fundamentally deleted, but only postponed or simplified. ​

Another important aspect is the consideration of the sustainability requirements of Business partners and financial institutions:​

Requirements of business partners in the supply chain: Many large companies require their suppliers to demonstrate sustainable practices in order to meet their own sustainability goals and legal obligations. Many corporations have now defined sustainability goals for their supplier network, which include environmental and social standards, particularly respect for human rights. Companies that do not meet these standards risk losing contracts.

Requirements of banks and financial institutions: Financial institutions are increasingly integrating ESG (Environmental, Social, Governance) criteria into their lending processes. Companies that can demonstrate sustainable practices often benefit from more favorable financing conditions. For example, banks consider Lending considers a company’s ESG factors, to reduce the risk associated with lending. Companies that do not meet these criteria may face higher financing costs or limited access to capital.

Through proactive preparation of a VSMEBy publishing a compliant sustainability report, companies can not only meet regulatory requirements but also improve their competitiveness and financing options.