The EU’s Omnibus I Directive — Directive (EU) 2026/470, published in the Official Journal on February 26, 2026 and in force since March 2026 — rewrote the scope of the Corporate Sustainability Reporting Directive (CSRD). For many U.S. companies that spent 2024 and 2025 preparing for CSRD, the question is now simple: are we still in?
The new thresholds
| Who | In scope if… |
|---|---|
| EU companies and groups | More than 1,000 employees and more than €450 million net turnover |
| Non-EU (e.g., U.S.) parents | More than €450 million net turnover generated in the EU, plus an EU subsidiary or branch with more than €200 million in turnover |
| Listed SMEs | Removed from scope |
Most U.S. companies will meet these tests, if at all, through an EU subsidiary large enough to clear the EU-group threshold, or at the parent level under the non-EU rule, which applies to later financial years. Member states have until March 2027 to transpose the amendments, so watch for national variations where your EU entities sit.
What else changed
- Assurance: the move to reasonable assurance was dropped; limited assurance remains.
- Sector standards: the Commission will no longer adopt binding sector-specific standards.
- Simpler ESRS: the reporting standards are being slimmed down, with a focus on quantitative data points.
- Value chain cap: in-scope companies are limited in what they can demand from value chain partners with 1,000 or fewer employees, beyond a voluntary reporting standard.
Out of scope doesn’t mean out of reach
Even if your company falls below the thresholds, your largest customers may not. EU companies that still report under CSRD — and U.S. companies reporting under California’s SB 253 — need emissions and sustainability data from their suppliers. The value chain cap limits what they can formally require from smaller partners, but it does not stop commercial pressure. Expect sustainability questions in RFPs, supplier codes of conduct, and contract renewals.
What to do now
- Re-run your applicability analysis against the new thresholds, entity by entity.
- Decide what to keep. Work done on double materiality and emissions data is still valuable for SB 253, ISSB-aligned reporting, and customer requests.
- Review supplier and customer contracts for sustainability data obligations and representations.
- Brief the board. A scope change is a good moment to reset governance and reporting responsibilities.
Southshore Partners advises U.S. companies on CSRD applicability, multi-framework reporting, and supply chain contracts. Learn about our ESG practice or get in touch.
Jeff McCourt is the founder of Southshore Partners and a former CPG founder and CEO who led his company to B Corp certification.
This article is for general information only and is not legal advice. It reflects developments through early October 2026.