The EU’s Omnibus Package: Simpler Rules, Smarter Choices?

April 2025

In April 2025, the European Commission introduced the Omnibus package—a bold attempt to streamline EU legislation, cut administrative burden, and create a more supportive environment for innovation and investment. With a targeted 25% reduction in admin costs (35% for SMEs), the package covers key sustainability-related laws, including CSRD, CSDDD, the EU Taxonomy, and more.

On paper, this sounds like a long-overdue simplification. But it raises a familiar question: Are we truly reducing complexity—or just shifting it around?

So, what’s changing?

The Omnibus package includes some notable shifts:

• CSRD: A two-year delay for wave 2 companies, removal of sector standards, and the option for out-of-scope companies to report voluntarily.

• CSDDD: Focus limited to direct business partners, assessments every five years, and decoupling penalties from turnover.

• Taxonomy: Scope narrowed to companies with more than 1,000 employees.

• Overall: A clear move toward deregulation and targeting the largest players, with the promise of freeing up resources for innovation and growth.

The European Commission estimates this could save businesses €6.3 billion annually and unlock €50 billion in public and private investment.

For the tech sector: freedom or fragmentation?

For tech companies, especially start-ups and scale-ups, the message is mixed. Less red tape? Absolutely. But tech supply chains are global and tightly integrated. If you’re not in scope for CSRD, chances are your clients or investors still are—and they’ll be asking questions.

So while some companies may celebrate the removal of burdensome reporting requirements, market expectations aren’t going anywhere. If anything, transparency is becoming more business-critical—just less legally mandated.

What does it mean for SMEs?

For SMEs, the shift is significant. The promise of voluntary, simplified sustainability reporting may reduce compliance fatigue. And crucially, the Commission says these companies will still have access to sustainable finance frameworks—meaning green loans, ESG-linked funding, and investment incentives remain on the table.

However, flexibility comes with trade-offs. Without common standards, SMEs risk getting lost in a fragmented landscape of client questionnaires, investor demands, and voluntary initiatives. Will the administrative burden really drop—or just change shape?

Between simplification and ambition

The Omnibus package is clearly a pivot point for EU sustainability regulation. The direction is pragmatic: focus on the biggest players, free up SMEs, and let voluntary standards fill in the gaps. Whether this approach maintains ambition—or risks weakening transparency—will depend on how business, finance, and civil society respond.

Bottom line?

Even with lighter regulation, the pressure to deliver on sustainability isn’t going away. ESG due diligence is fast becoming standard business practice, whether mandated or not.

Simplified rules offer flexibility—but they’re not a free pass. Voluntary reporting still needs to be credible if companies want to attract partners, investors, or talent.

And let’s not forget: the EU’s long-term goals haven’t changed. The Green Deal, climate targets, and circular economy agenda are all still on the table. The question is how companies—especially SMEs—choose to align.

📄 Want the details? The Commission’s Q&A is available here:

https://ec.europa.eu/commission/presscorner/detail/lt/qanda_25_615

5 Sustainability Myths

As with anything that has a big impact on our lives myths tend to run rampant. This is not different when it comes to sustainability. Here are 5 persistent myths and an attempt to debunk them.

MYTH #1 Customers don't care about sustainability

When talking to business owners I hear this one a lot. With myths that involve a large group of people it comes in handy to look at some statistics. IBM published a report in 2020 studying consumer behaviour. It found that

• Nearly 6 in 10 consumers are willing to change their purchasing habits to help reduce negative impact to the environment.

• Of those who say that sustainability is important to them over 7 in 10 are willing to pay a premium for brands that are environmentally responsible.

Customers are becoming better informed and more aware of the environmental impact of consumer products. This is driving their purchasing habits and brand loyalty. Delivering on sustainability as a business will therefore not only help reduce environmental impact, it will also have a positive impact on the bottom line.

MYTH#2 Life Cycle Assessment is too complex

It is hard to deny that the calculation of the life cycle impacts of a product is often an intricate process. It requires a very specific skill and an enormous amount of data. Not to mention the fact that it is time-consuming and expensive.

However, under certain conditions it is possible to do a so-called 'fast-track' LCA. This method allows for a quick screening of the life cycle impact of a product. This is especially useful for a quick estimate of priority areas by looking at the the share (%) of inputs such as transport, raw materials and electricity use of the product carbon emissions.

Knowing where the impact comes from will help creating a strategy to reduce the carbon footprint of a product for a manufacturer. For example, in the case of raw materials this could be achieved by substituting with recycled materials or reused parts. Fast track LCA depends on publicly available emission factors and can be executed using nothing more than an excel table. This makes it far less complicated to figure out where the largest impact is coming from how to prioritise innovation.

MYTH #3 Corporate Social Responsibility Reporting is 'greenwash’

Sometimes it is.

A lot of effort has gone into publishing shiny CSR reports without translating corporate values into real action. There are, however, a lot of practical first steps that are worth taking to address social and environmental responsibility. To name a few

• Measuring environmental performance in order to design sustainable products and services, including public procurement in the process.

• Ensuring continuous improvement of impact reduction in a way that is quantified and which is communicated to stakeholders.

• Carrying out due diligence with respect to human rights protection across the supply chain.

In communicating CSR activities a common language is enormously helpful. The Global Reporting Initiative (GRI) has created a list of standards to support CSR reporting. Good CSR reporting shows how environmental and social impacts are addressed in a way that is transparent, accountable and responsible. It is therefore up to the individual businesses whether their CSR report is 'greenwash’ or not.

MYTH#4 A sustainability vision is good in itself

A vision of its own is like a New Year's resolution, if not put into action nothing happens.

According to an MIT Sloan study, 90% of executives see sustainability as important, but only 60% of companies have a sustainability strategy and only 25% have a clear business case for their sustainability efforts (according to a BCG/MIT report.

A vision leads to improved business performance if it is translated into measurable targets, addresses priority material issues and if it is implemented across the entire organisation. This is especially true for a topic such as sustainability, with its wide scope and complexity. Frameworks (such as ISO 14001, UN SDG) and tools (Life Cycle Assessment, GRI indicators) can help with prioritisation and implementation. These are effective methods to put a sustainability vision into action, most importantly if stakeholders are involved.

Let's leave the New Year's resolution style to reducing calories, not carbon emissions.

MYTH #5 circularity is always sustainable

Circularity may actually result in an increase in environmental impact, even if you had the best intentions. It is like planning to save money during Black Friday. It should reduce the money you would normally spend. Yet you end up with more stuff than you can comfortably imagine.

For example, buying a plastic or steel tin of coffee beans may seem a better environmental choice than an unrecyclable composite bag. However, looking at the energy use per 340 gr of product: plastic 5 MJ, steel 4 MJ, composite 1 MJ (source: WRI report) this may not be the best option.

Recycling of the plastic or steel requires resources. Looking at Lansink's ladder we could repurpose the tin (keep buttons in it?) and reuse it. For a commodity with a short life cycle (=a lot of tins!) this may not be the best option. I would prefer a bag that is recyclable, provided that the impact of recycling (e.g. energy use, transport) are less than the resources required for extraction and disposal.

The only way to ensure that circularity is sustainable is to analyse all the environmental (and social) impacts across a products' life cycle. Otherwise it may actually lead to resource depletion.

Ditching the sustainability framework…or not?

What is happening? Extinction Rebellion protests against ecological collapse, one small chocolate bar seems to result in a water scarcity footprint of 21 litres, and EU ministers are fudging the 2030 climate target lines…one can't help but wonder what is next. Can we rely on the current sustainability frameworks to gear our actions toward a more resource efficient and people-friendly planet?

Remember this: Elkington famously coined the Triple Bottom Line (TBL) in 1994. It was meant to create a system change by adding a social and environmental dimension to the way companies perform. Also known as People, Planet, Profit, or simply 3P. Some people even put it in their company name (did you spot it yet?).

But here it comes: John Elkington himself states in an HBR article that he wants to recall the Triple Bottom Line. He states that all the sustainability frameworks in the world are not going to save us as long as they are not accompanied by the radical intent to stay within our planetary boundaries. According to Elkington corporate leaders heavily prioritise their profit targets over the people and planet targets. The TBL concept ended up as a reporting tool rather than a means to genuinely manage the impact on our planet. In that sense the TBL concept has not produced the desired change in the single bottom line paradigm.

What about Circular Economy? True, it is currently the go-to for anything sustainable for policy makers and companies. As the Ellen MacArthur Foundation describes it: ‘an industrial economy that is restorative or regenerative by intention and design’. It is at the heart of value creation through activities such as remanufacturing. I always find it hugely impressive to watch an industry transform from a linear to a circular model and gladly support the process. For resource efficiency Circular Economy is key.

That should do it: Yes and no. As the name indicates, the circular economy focuses on product innovation and circular business strategies. Primarily benefiting both the environment and the businesses implementing a circular business model. However, the social aspect seems to be more fuzzy. For those intrigued by the difference between circular economy and sustainability (including TBL) check out this article from the Journal of Cleaner Production.

 What about Brundtland? Believe it or not, there are 300 definitions of sustainability. Brundtland’s definition of ‘meeting present needs without compromising the needs of future generations’ remains a classic. One of the hardest things I encountered starting out as a sustainability consultant was that everybody seems to have a different understanding of what sustainability actually is. For one client it was about employability, for another about recycling critical raw materials, yet for another it was about access to healthy eating. All of these make sense, they are all part of the holistic approach.

Back to the protests, ecological disasters and fudging ministers: Environmental responsibility is increasingly demanded by the general public, (most) policymakers and a younger workforce. So where do we go from here? Based on my own experience I find the following approach very handy: One, create a clear vision and strategy based on the three pillars of People, Planet and Profit. Two, apply circular thinking in product design and business models, involving all stakeholders in the process. Three, walk the talk: ensure that all sustainability communications are supported by data (LCA analysis is extremely helpful here). Whatever framework, or solution, the drive for change is here.